Maryland Public Service Commission orders utilities to clarify costs in electric bills
Commission aims to help consumers make informed choice of supplier
Maryland's Public Service Commission has ordered electric utilities to include more information on customers' bills so consumers can more easily estimate costs as they decide whether to buy electricity from their utility company or a separate supplier.
The order, issued Thursday, requires the state's four investor-owned utilities to put the more detailed information for price comparison on bills by Aug. 1.
The commission found that the "price to compare" which it ordered utilities to post on customers' bills seven years ago so that consumers could examine supply costs does not provide enough useful pricing information to consumers and could mislead them.
The PSC ordered utilities to replace that single comparison point both on bills and their company websites with detailed prices for their standard-offer service, including their current charge per kilowatt-hour and the end date for that price; the charge per kilowatt-hour thereafter and its end date; and a notice that the price beyond that date has not been set. The end dates were required because prices change with contracts, which are bid twice annually, and typically are higher in the summer.
Utilities also were ordered to post a weighted average price for their standard offer service as well as the date through which that average applies.
When the commission required posting a "price to compare" in 2003, it did not define how it should be calculated.
Companies interpreted it in different ways. Some utilities include future costs in the calculation and some do not; some revise the comparison price more often than others. Pepco, for example, waits a full year to update its price to compare, the commission found.
The weighted average that will appear on bills by Aug. 1 will have to factor in current and future costs.
The commission also is requiring utilities to update the weighted average information as soon as possible after it makes new power purchases that affect price.
"We believe that this new price display will be less confusing and provide more accurate and useful information to consumers who are considering offers from electricity suppliers," People's Counsel Paula M. Carmody said in an e-mail, noting her office, which is charged with representing the public's interest before the commission, had recommended the changes.
Utilities have not objected to the PSC's order.
In an e-mailed statement, Pepco, with more customers than any other utility in Montgomery County, said it is "committed to providing our customers with adequate information to enable them to make informed choices about their energy use, including their choice of an energy supplier" and is "reviewing the Commission's decision to identify additional steps required to comply with the Commission's Order."
Meanwhile last week, the commission rejected BGE's request to require its customers to switch to advanced "smart" meters and pay time-of-use prices and much of the upfront costs for new technology, which is estimated at $835 million. The commission agreed with the people's counsel and the AARP that the complexities of the proposal would offer residential customers too little assurance of savings and that the technology could pose privacy and security risks.
Pepco has a smart grid proposal before the commission and expects a decision within two weeks, Pepco spokesman Clay Anderson said.