PSC plans to reopen energy rate hike case

Some are cheered, some unimpressed by effort to revisit last year’s decision

‘‘I have complete trust in Steve. I don’t think he’s doing it unless there’s reason to do it,” House Speaker Michael E. Busch (D-Dist. 30) of Annapolis said Thursday.

Larsen technically won’t lead the PSC, which oversees the state’s utilities, until next week at the soonest. He and fellow PSC appointee Susanne Brogan are scheduled to appear before the Senate Executive Nominations Committee on Monday. Traditionally, the full Senate confirms appointees within the week of their appearance before the committee.

Martin O’Malley, while Baltimore mayor and gubernatorial candidate, challenged the rate hike in court, and Baltimore city Circuit Court Judge Albert J. Matricciani Jr. ruled PSC Chairman Kenneth D. Schisler had failed to adhere to due process in approving the increase.

The PSC, in a statement, said the hearings would consider whether the increases are based on ‘‘verifiable, prudently incurred costs, plus a reasonable rate of return.” The hearings also will consider whether a rate mitigation plan would be appropriate for BGE ratepayers.

Sen. James N. Robey, whose Howard County district is served by BGE, said he was happy to see the hearings.

‘‘We need to hold hearings to see if they [BGE] can justify the 72 percent. They probably can, but before we hold hearings, how can we know,” said Robey (D-Dist. 13) of Elkridge.

Senate Minority Leader David R. Brinkley, however, was less impressed.

‘‘The fix was so urgent we had to ram it through last summer. Now, it’s not the Metamucil the situation needed,” said Brinkley (R-Dist. 4) of New Market.

‘‘We’ll have to see. The whole issue of energy is national and becoming global. We’ll see if the decisions of the PSC have any impact on the availability, affordability and generation.”

His cross-chamber counterpart, House Minority Leader Anthony J. O’Donnell (R-Dist. 29C) of Lusby, said: ‘‘If they’re going to reopen this process, I would hope it’s very transparent ... and open to the public’s view.”

The announcement comes on the heels of deep turnover on the five-member board. Schisler, a former delegate, resigned Feb. 2. Commissioner Charles Boutin’s resignation takes effect March 7. Both Schisler and Boutin were appointed by O’Malley’s predecessor, Robert L. Ehrlich Jr. (R).

Larsen was picked to replace Schisler. Brogan was selected to fill a vacancy on the commission. O’Malley (D) has not named a replacement yet for Boutin, a former delegate.

Larsen was the Maryland insurance commissioner until 2003. That year, his review of a potential merger between CareFirst BlueCross BlueShield and WellPoint Health Networks Inc. of California helped to nix the $1.3 billion deal. Lawmakers, uneasy about CareFirst’s conversion from a nonprofit into a for-profit enterprise, objected to payouts to the insurer’s executives.

O’Malley made the PSC’s failure on the BGE rate increase a major part of his gubernatorial campaign. He pledged to hire professionals for the commission to protect consumers.

‘‘I find it ironic to put Larsen in who has no utility experience,” Brinkley said.

Ehrlich argued O’Malley’s proposals would lead to uncertainty among regulated industries. Utilities, however, have had positive comments about the recent PSC moves.

Robert L. Gould, managing director for Constellation Energy, which owns BGE, said the utility welcomes ‘‘the certainty and balance” that Larsen and Brogan bring.

‘‘Larsen and Brogan are well-known and respected for a steady hand and professional approach, and both have a long track record of exercising good judgment when it comes [to] balancing multiple interests,” Gould said via e-mail.