Baltimore Gas and Electric will move forward with its amended smart grid plan after all.

The Maryland Public Service Commission approved an amended, and hotly contested, smart grid plan late last week. The project will be funded in part by $200 million grant from the Department of Energy, which the utility was in danger of losing, and by rate increases. The rate increases were the touchy part. Consumers have also complained about a lack of benefits and fears about electromagnetic radiation.

BGE says the current installation will save its customers $2.6 billion over 15 years.

"The benefits include at least $2.5 billion worth of savings for BGE customers over the life of the project, as well as major new enhancements in customer service and reliability. In addition, BGE will be able to take advantage of $200 million that the U.S. Department of Energy awarded BGE for its innovative program, reducing the cost of the project for BGE's residential customers by 80 percent," said Kenneth DeFontes, BGE CEO, in a prepared statement.

The move will also buoy Accenture, Oracle and others who have signed contracts with BGE.

BGE resubmitted its amended proposal in July after the state PSC rejected its initial smart grid plan in June. The DOE extended the deadline for approval until July 30 and then August 16. If BGE didn't make the deadline, the grant would vanish.

Here are some of the details from earlier stories by Katie Tweed:

The plan still calls for some increases (about 30 cents per user per month according to the filing), but BGE claims that will be offset by an average customer savings of about $100 per year.

The Maryland PSC suggested the utility pay for this proposal as a regulatory asset, but BGE argues that smart grid upgrades are not classic utility infrastructure improvements and require a hybrid approach where it can recover 25 percent of costs while the project is being implemented and the rest through future base rate cases.

BGE claims that a tracker, which will allow for gradually phasing in the cost to customers, is not a guaranteed cost recovery mechanism, and that it provides opportunity for review. The proposal suggests semi-annual reviews of the tracker to ensure that customers aren't being swindled. 

BGE also scrapped mandatory TOU pricing and instead made it optional for customers to pay lower rates during off-peak, while also enrolling everyone in a rebate plan for those who conserve energy during peak demand, similar to a plan that Washington D.C. is considering.

The utility also moved up its schedule for unveiling an energy management portal for its customers to October 2011, which will be much closer to the initial deployment of meters. In the first proposal, the portal was not proposed until nearly one year after meters were to start being installed. Many experts feel as though long delays in web portals have hurt some smart meter rollouts. However, BGE did not seem to take lessons learned from other utilities' smart meter deployments (other than making the case for recouping costs using a tracker), as lack of consumer engagement has been been a constant criticism of past smart grid projects.

Tags: accenture, bge, complaints, demand response, energy efficiency, itron, oracle, smart grid, smart meter, time of use pricing