BGE’s conduit financing memo should be made public, the PSC says
The document may shed light on an arrangement the Office of the People’s Counsel has called a “monopoly company’s gambit” to benefit its investors at the expense of city customers
Above: A new conduit line being installed on Greenmount Avenue in 2019. (Commercial Utilities LLC)
An internal memo related to the conduit deal that Baltimore Gas and Electric Co. (BGE) struck with Mayor Brandon Scott earlier this year must be made public, Maryland regulators have ruled.
The company had submitted the accounting memo as part of its ongoing rate case, the process used to set electric and gas rates for utility customers.
BGE’s lawyers cited “accountant/client privilege” in arguing that the memo should remain confidential.
But noting that its actions have “direct and material impacts on Maryland ratepayers,” the Maryland Public Service Commission (PSC) said “transparency is paramount.”
“The basis of a Commission decision, particularly a rate case, should not be evidence that is shielded from view by the public and that renders the decision a ‘black box,’” the PSC said in a decision announced yesterday.
“The Commission does not find any information contained therein to be commercially or financially sensitive, privileged or otherwise entitled to blanket confidentiality protection.”
“Having reviewed the document, the Commission does not find any information contained therein to be commercially or financially sensitive, privileged or otherwise entitled to blanket confidentiality protection,” it continued.
The ruling gives BGE 10 days to propose redactions to the memo before the public can access it.
Spiniello company workers overhaul a section of Baltimore’s underground conduit system. (Fern Shen)
Denounced as a Giveaway
The decision by the five-member board came in response to a motion made in September by the Maryland Office of the People’s Counsel, which called for the document to be made public.
People’s Counsel David S. Lapp has been sharply critical of the conduit deal, first disclosed last January by The Brew.
• EXCLUSIVE: BGE is quietly pushing to control Baltimore’s underground conduit system (1/26/23)
• EXCLUSIVE: Staff report says BGE conduit deal is not in city’s best interest (2/1/23)
Under the terms of the agreement, BGE would gain extensive control of the city’s 700-plus-mile, underground conduit system in return for promised capital investments.
The deal, which was eventually approved by the Board of Estimates, roiled City Hall for months.
The Scott administration argued that Baltimore’s aging infrastructure of electric and fiber-optic cables under city streets would benefit in the long run from the arrangement.
But it was widely criticized by many, including Lapp, as a giveaway to Maryland’s dominant utility provider.
Lapp has estimated the cost of the arrangement to Maryland ratepayers at $860 million over 50 years and denounced it as a “monopoly company’s gambit” to benefit its investors at the expense of its customers.
The internal memo, he said, will show the company’s arguments for why it should be able to earn a return on its investment in a conduit system it does not own.
In addition to housing cables for BGE, Verizon, Comcast and other private companies, the underground network is used by the city’s own phone, traffic light and internet services.