The Maryland Public Service Commission (PSC) on Monday rejected a massive smart-grid project proposed by Baltimore Gas & Electric Co., a unit of the Constellation Energy Group (NYSE: CEG).
The decision may represent an emerging trend among state commissions that could stand in the way of smart grid deployments nationwide.
BG&E had already received a $200 million committment for a DOE grant--one of the six largest smart grid grants.
The utility planned to install 1.36 million smart electric meters and 730,000 smart gas meters to allow advanced communication options between customers and the utility. The entire cost of the program was estimated at $835 million.
Maryland's PSC opposed the creation of a surcharge to help cover the cost of the program, stating that long-term ratepayer benefits did not seem to correspond with short-term rate hikes.
Demand response consultant Ahmad Faruqui told the New York Times the PSC decision refrelects a trend in which commissions are hesitant to support real-time pricing.
Real-time pricing is seen as one of the greatest benefits of smart metering in that it allows for higher rates to be charged during times of peak electricity usage and lower rates during off-peak times. The dynamic nature of the pricing would encourage consumers to shift non-essential energy use to off-peak hours, thereby reducing the need for additional power generation.
But consumer rights groups have been warning of increased power bills, and politically appointed commissioners appear to be listening.
Katherine Hamilton, president of the GridWise Alliance, said the Maryland decision highlights the need for greater outreach to "quantify the consumer benefits of the smart grid."
BG&E said the smart grid plan may be dead.
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