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The Maryland Public Service Commission (PSC) on Friday approved Baltimore Gas & Electric’s smart grid plan with the condition that the utility could not assess a surcharge upfront to customers to help pay for it. The PSC’s decision came a few days before the U.S. Department of Energy’s deadline to decide whether to redirect the $200 million in stimulus funds it had awarded to BGE.

The PSC's decision puts the ball in BGE’s court. Whether or not to go forward is now BGE’s decision. With a surcharge off the table, BGE will have to come before the commission in the future and make a case for why it needs to raise rates to cover the costs of implementing the smart grid plan.

Smart grids use two-way communication between power suppliers and upgraded power meters at homes and businesses to reduce electricity demand during peak hours, when power is most expensive. The company had proposed a plan where it would collect 25 percent of the project’s cost through a surcharge and the rest would come later through rate increases that have to be approved by the PSC.