The Baltimore Sun

.............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

OP-ED
Unnecessary Gas Investments Set to Raise Rates; Maryland Regulator Must Intervene | Guest Commentary
By David S. Lapp
For The Baltimore Sun
Feb 10, 2023

"Unnecessary Gas Investments Set to Raise Rates; Maryland Regulator Must Intervene." - The Baltimore Sun (February 10th, 2023)

It’s time for a reality check in Maryland. The state’s gas utilities are making massive long-term investments in their gas delivery systems, even though gas use must decline rapidly to meet Maryland's aggressive climate goals and electric technologies are outperforming fossil fuels. Ultimately, customers could be on the hook for these investments.

Yet the Public Service Commission, which regulates the utilities, has taken no action to steer these companies in a different direction. The reality is that action is needed immediately to protect gas utility customers from looming massive rate increases and to meet Maryland’s climate goals.

The gas companies are pursuing their economic interests, aggressively, for the benefit of their investors. They are spending large amounts on their systems, because they make money by recovering their capital investments — along with a return for investors that more than triples the total costs for customers — through utility bills. Exelon, the Chicago-based parent company of Maryland’s largest gas utility, Baltimore Gas & Electric, recently told its investors that BGE would increase its gas distribution capital spending from $475 million annually in 2022 and 2023, to $500 million in 2024 and another $500 million in 2025.

BGE's gas distribution delivery rates already have doubled since 2010. The ongoing massive gas utility spending is increasing rates further and will lead to even larger system costs in the future — more than double what customers are paying today by 2035.

At the same time, gas utilities are losing market share to highly efficient, cost-effective electric technologies for space heating, hot water heating and cooking — a trend that will accelerate with government policies supporting electrification. While the gas industry is pushing back hard, the broad consensus is that electrifying our buildings is cost effective and necessary to meet state climate goals.

Customer departures to electricity means fewer gas customers and fewer gas sales. Huge, anticipated increases in gas utility fixed costs will then be divided among fewer sales, requiring rate increases. As the difference between gas and electricity rates widens, more and more customers will leave the gas system, threatening what industry insiders call the “death spiral.”

In the spiral scenario, customers who are unable or can’t afford to electrify — low- and moderate-income customers and renters — will be stuck with increasingly unaffordable rates. My office, the statutory representative of residential utility customers, has documented the potential rate increases in two recent reports, one of which shows that by 2050 BGE rates could increase by as much as eight times from 2021 levels.

The Public Service Commission has already approved most of the utilities’ pre-2023 spending, and under utility law, the utilities have legal arguments that they are entitled to recover those costs, even if the pipes are hardly — or never — used in the future. Thus, under the law, until someone tells the gas utilities to slow or stop that spending, which would weaken their legal arguments substantially, gas utilities are incentivized to spend as much as they can as fast as they can.

That someone is the Public Service Commission. State law directs the commission to “supervise and regulate” the gas utilities to make sure they operate in the public interest and that customer rates are “just and reasonable.” It further requires the commission to consider the state’s climate commitments. Yet, unlike other states with aggressive climate policies, the commission has not begun to gather information on the impacts of the changing landscape and supervise the necessary transformation of gas utility operations.

To encourage the commission to act, our office filed a petition Thursday asking the commission to undertake immediate priority actions and long-term planning. The double-barreled approach aims to reconcile current gas practices and future planning with market trends and the reduction and eventual elimination of fossil gas use in Maryland, as necessary to meet state climate goals.

What the state desperately needs from the commission — which will soon have new blood appointed by the governor — is proactive leadership. Rather than deferring to or only addressing what the shareholder-focused utilities propose, the commission should set the agenda for the clean energy transition and guide a transition process that is robust, transparent, and inclusive of all.

David S. Lapp (davids.lapp@maryland.gov) is the Maryland People’s Counsel.

"Unnecessary Gas Investments Set to Raise Rates; Maryland Regulator Must Intervene." - The Baltimore Sun (February 10th, 2023)

BUSINESS
"Former Residents of Black Neighborhood Want Feds to Investigate Displacement in Baltimore"
By Giacomo Bologna
The Baltimore Sun
Feb 13, 2023

Angela Banks remembers it was a brief phone call. Her landlord told her she needed to leave as soon as possible. He was selling the three-story rowhome in Poppleton — her home for decades — to the city of Baltimore to make way for a new development.

It was wintertime in 2018. Banks and her five children moved into her green Ford Explorer. At night, they rolled up the windows, put on two pairs of pants and piled clothes on themselves to keep warm. During the day she begged for gas money.

“I lost everything. Everything I worked hard for and everything that I had, I lost,” Banks said. “Didn’t take nothing except trash bags and clothes.”

On Monday, Banks, along with the nonprofit advocacy group, Economic Action Maryland, filed a complaint with the federal government to investigate the displacement of Black residents from Poppleton under the Fair Housing Act. They held a news conference on the steps of Allen A.M.E. Church, a block south of Banks’s old home, with current and former residents to announce the complaint against the city.

The complaint was filed with the U.S. Department of Housing and Urban Development and it alleges that when the city of Baltimore targeted Poppleton for redevelopment, it disproportionately displaced Black residents from their homes and perpetuated the city’s segregation.

'Baltimore has long been a tale of two cities. One a wealthy, predominantly white city with charming homes, tree-lined streets, and all kinds of amenities,' said Marceline White, executive director of Economic Action Maryland. 'While the other predominantly lower income, majority Black neighborhoods have seen little investment or improvement in their communities for decades.'

City leaders slated Poppleton, a predominantly Black neighborhood, for redevelopment as early as 1975, according to the complaint. Almost 20 years ago, the city promised to raze about 500 homes there to clear space for a massive complex of apartments and other buildings to be developed by La Cite, a New York-based firm. In 2015, the city approved up to $58 million in public financing for the project.

Neither the city nor La Cite responded Monday to requests for comment. As part of their deal, the city acquired rowhomes, paying homeowners to leave and knocking down entire blocks.

But the massive redevelopment plans limped along through the Great Recession, then the pandemic, and the project known as Centre\West is just now entering its second phase, an $80 million senior housing apartment building with 176 units located at the corner of Schroeder and Saratoga streets, the Baltimore Business Journal reported last week.

A former homeowner and neighbor of Banks, Parcha McFadden, spoke at Monday’s news conference, as well as Sonia Eaddy, who successfully saved her historic rowhome from demolition after a fight stretching back nearly 20 years. Eaddy said eminent domain and the threat of seizing properties have destroyed her neighborhood.

The complaint says that even if the redevelopment project had finished in 2015 as originally planned, most of Poppleton's original residents wouldn't have been able to afford the rent of the newly constructed apartments.

The complaint also lists a set of demands, including:

• Compensation for former Poppleton residents as well as a right of return for any new housing;
• Significantly curbing the city's ability to use eminent domain, and
• Creating a community oversight board to oversee any future use of eminent domain; A community land trust for the Poppleton neighborhood.

"I would like to ask the city, 'Where is our just compensation?'" Eaddy said. "It is a permanent erasure of a people of color, our history, our culture, our characteristics, our identity. There is nothing to show we ever existed; Black neighborhoods matter."

As for Banks, she said she spent about six months living in her car before finding a home in Morrell Park in Southwest Baltimore, though her rent is significantly higher. The home on the 1100 block of West Saratoga Street where she lived for decades is still standing. The city owns the property. It has sat vacant since her family was forced to leave in 2018.

Last year, Baltimore paid about $50,000 to compensate Banks for her family's displacement, she said, but much of the money went toward paying back debts accrued when she was living in her car and later struggling to find stability.

"The city, they broke me," Banks said. "They broke me to the point where I tried to commit suicide - I guess God had a different plan for me.'

Banks said the stories told Monday morning were just a few snapshots of hundreds of families who once called Poppleton home.

"The struggle was real," Banks said. "Just imagine how many other people that this happened to that never got to tell their story."

- "Former Residents of Black Neighborhood Want Feds to Investigate Displacement in Baltimore" - The Baltimore Sun (February 14th, 2023)

Mission Abound

Homes * Any Street * Baltimore * USA * 01234

Any Street * Anytown * Baltimore * USA * 01234

........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................