Democrat power in Maryland screws power co's and consumers
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JoeUser Forums
JoeUser Forums
In another not quite so bright and shining example (the costs for the power to make it bright and shining are too great currently) of how badly things can go when a state legislature has been under Democratic control for too long, the state legislature in Maryland has royally screwed up and screwed over the power companies and the customers of those companies.
Seriously, the news reporting on the situation and the actual activities invovled in the situation have been reminiscent of old keystone cops/looney tunes type situations. The legislature, and the former governor (one not so bright Parris Glendening) set things up to begin with by using a California style power deregulation scheme to promise the customers in the state that in the future they'd benefit from lower power prices from increased competition. Sadly, they paid no attention to the situation in California during their energy crisis of a few years back and they ignored the looming problems that they hadn't dealt with in their own flawed bill that had become law.
Rather than monitoring the competitive situation and requiring at least a certain level of real, measurable, competition before completely lifting the burdens of regulations, the lawmakers ignored things completely and pretended that there were no problems with the plan as it progressed.
Flash forward a few years and the price of energy has skyrocketed (though the power companies still seem to be bringing in more revenue than they have been spending, but that is a different argument) and the power companies are watching the price caps that were in place being lifted. As the caps come off, they lobby the PSC (Public Services Commission or whatever the official name is) to get price increases in place to cover their costs and allow for a reasonable profit.
Now, assuming that the power companies are right, and the power prices have increased, then they don't really have a choice. They have to get those costs somewhere or be driven out of business. They have stockholders and employees that they are responsible to and they have to be meeting those obligations. They also have costs besides just salaries and costs of fuel to worry about -- including borrowing costs when they need funds over short or long term. As they try to manage their cash flows, they are directly impacted by their bond ratings.
This is where things currently get messy and Democrats in Maryland should be taking the heat entirely. As the article referenced here: Miller blamed for downgrade details the Democratic energy rate reduction plan that was recently passed, and worse their plan to fire the PSC members and replace them with their own stooges sent bad signals to Wall Street and Wall Street in turn has lowered the bond ratings for the electric companies in Maryland, raising their costs even more and squeezing them all the more.
As that article notes, eventually the consumer will suffer and will be forced to pay the costs. Eventually the electric utilities will have to get back the money that the higher fuel costs them and they'll have to get back the higher borrowing costs as well.
All of this may never have happened if Maryland wasn't a staunchly "blue" state that is overwhelmingly controlled by Democrats in the Legislature. If there was at least some balance and not just some token Republican minority there to help make sure that the laws that are passed include real checks and balances then things might not have gone so horribly wrong. Sadly though Maryland has been in this situation for some time and the voters in the state seem slow to realize that they are ultimately the idiots that have voted for the morons that are passing the laws that are screwing them over. As always, it always seems to be the other guy's representatives that need to be booted, not my own. I continue to say that is B.S. and all of the incumbents in the legislature should be tossed. Turn them all out and lets start with new politicians that aren't beholden to anyone, or at least aren't carrying the old baggage and old debts and favor chits around.
Seriously, the news reporting on the situation and the actual activities invovled in the situation have been reminiscent of old keystone cops/looney tunes type situations. The legislature, and the former governor (one not so bright Parris Glendening) set things up to begin with by using a California style power deregulation scheme to promise the customers in the state that in the future they'd benefit from lower power prices from increased competition. Sadly, they paid no attention to the situation in California during their energy crisis of a few years back and they ignored the looming problems that they hadn't dealt with in their own flawed bill that had become law.
Rather than monitoring the competitive situation and requiring at least a certain level of real, measurable, competition before completely lifting the burdens of regulations, the lawmakers ignored things completely and pretended that there were no problems with the plan as it progressed.
Flash forward a few years and the price of energy has skyrocketed (though the power companies still seem to be bringing in more revenue than they have been spending, but that is a different argument) and the power companies are watching the price caps that were in place being lifted. As the caps come off, they lobby the PSC (Public Services Commission or whatever the official name is) to get price increases in place to cover their costs and allow for a reasonable profit.
Now, assuming that the power companies are right, and the power prices have increased, then they don't really have a choice. They have to get those costs somewhere or be driven out of business. They have stockholders and employees that they are responsible to and they have to be meeting those obligations. They also have costs besides just salaries and costs of fuel to worry about -- including borrowing costs when they need funds over short or long term. As they try to manage their cash flows, they are directly impacted by their bond ratings.
This is where things currently get messy and Democrats in Maryland should be taking the heat entirely. As the article referenced here: Miller blamed for downgrade details the Democratic energy rate reduction plan that was recently passed, and worse their plan to fire the PSC members and replace them with their own stooges sent bad signals to Wall Street and Wall Street in turn has lowered the bond ratings for the electric companies in Maryland, raising their costs even more and squeezing them all the more.
As that article notes, eventually the consumer will suffer and will be forced to pay the costs. Eventually the electric utilities will have to get back the money that the higher fuel costs them and they'll have to get back the higher borrowing costs as well.
All of this may never have happened if Maryland wasn't a staunchly "blue" state that is overwhelmingly controlled by Democrats in the Legislature. If there was at least some balance and not just some token Republican minority there to help make sure that the laws that are passed include real checks and balances then things might not have gone so horribly wrong. Sadly though Maryland has been in this situation for some time and the voters in the state seem slow to realize that they are ultimately the idiots that have voted for the morons that are passing the laws that are screwing them over. As always, it always seems to be the other guy's representatives that need to be booted, not my own. I continue to say that is B.S. and all of the incumbents in the legislature should be tossed. Turn them all out and lets start with new politicians that aren't beholden to anyone, or at least aren't carrying the old baggage and old debts and favor chits around.
