Maryland Staff Proposes Lower POR Discount Rate for BGE Versus Utility Proposal

Maryland PSC Staff have recommended a residential electric Purchase of Receivables discount rate that is lower than the rate sought by Baltimore Gas & Electric.

As previously reported, BGE has filed to remove late payment charge revenues as an offset to the POR calculation. As reported by Staff, this results in a residential electric POR discount rate of 0.9148%.

Staff has recommended retaining late payment charge revenues as a POR offset, specifically recommending a residential electric POR discount rate of 0.1342%.

The current BGE residential electric POR discount rate is 0%.

Staff's recommended electric POR discount for all of BGE's non-residential classes is 0%.

Staff opposes any changes to the POR discount rate calculation methodology at this time, such as removal of the late payment charge revenue offset, because the supplier coordination working group continues to evaluate the use of the POR discount to fund various retail market enhancements.

Moreover, Staff said that incorporation of late payment charge revenues into the POR rate is not contrary to sound rate making, because such revenue on supplier charges would not exist without POR.

Staff said that BGE has not proven a subsidy exists from rate payers to suppliers, and that, "BGE also neglects to mention that its corporate parent would also receive a windfall if BGE retained the annual $4.6 million in LPC revenue."