Del. Impallaria: Energy - Deregulate or Regulate?
January 1, 2009
Annapolis Update - Energy - Deregulate or Reregulate? - Dec. 16, 2008
The final report to the Public Service Commission, “State Analysis and Survey on Restructuring and Reregulation (Task 2) and Analysis of Options for Maryland’s Energy Future (Task 3)” has been made. My committee, Economic Matters, has just received a briefing on it.
After listening to two hours of testimony by the Public Service Commission, I am still in full support of reregulation of the Maryland utility industry. The report showed that reregulation would be a good thing, starting three years after reregulation. This is supported by all the charts and statistics that were presented to us. In spite of this, unfortunately, the Commission feels that there are risks in reregulating.
One thing for sure, there has definitely been extreme risk in deregulation. The most recent risk is the devaluing of BGE and Constellation stock, which is proposed to be bought out by Warren Buffet at a fire sale price of $26 per share. Present stockholders would not be able to hold onto their stock until the value goes back up, which will happen immediately after the Buffet deal goes through. I feel it is in the best interests of BGE stockholders to reject the Buffet deal, if it is their intention to stick with a long-proven stock that will come back in value in the near future.
Under regulation, the management of Constellation Energy would not have been allowed to gamble with company assets in the commodities market, which caused the downfall in the stock values. Constellation’s value has not fallen due to a lack of customer base or an inability to produce a product. It has fallen strictly through the mismanagement of a deregulated management team — at the helm, Mayo Shattuck.
During the briefing, I asked three questions. First, if nuclear energy had been shown on the charts (which only showed gas, oil, and coal-fired energy), how would that change the outlook for energy reliability at a reasonable cost to Maryland consumers? The answer was, “Dramatically, it would increase the reliability of our future energy supply and provide a stable and predictable cost per kilowatt-hour, meaning lower cost.”
Second question: if the companies were reregulated, would the stockholders be forced to sell their stock? The answer to that was “No”, unlike the present deal which Warren Buffet is offering. Under regulation, a stockholder would be guaranteed a reasonable and fair return on their investment with little risk of losses.
Third, would jobs be more secure under a regulated or deregulated market, and which market would provide more jobs? I am waiting for an answer to that question from the Public Service Commission. It is obvious to me that BGE employees had more job security when the company was regulated than they have had since 1999, when deregulation took place.
On renewable energies such as wind and solar, the Commission did determine that wind offshore was not a productive means of energy and that wind on land is a break-even investment at best, while providing a very minor portion, less than 1% (one percent), of our energy needs. Solar costs more than it produces - in other words, it costs more to produce energy from solar than a company could charge for its product to make the business viable.
This study cost $3 million, and that cost will be passed on to the ratepayers in the State of Maryland. Having sat on the Economic Matters Committee and having been a member of the Public Utilities Subcommittee for six years, I can honestly tell you that I could have come up with the same conclusions for the cost of a notebook and a pen (and since my spelling is bad, an eraser) for a grand total of less tha $5.00.
There has been a major change in the ability to reregulate. As the cost of energy and the economy continue to plummet, so have the values of the power plants. A year ago the risk of purchasing these plants would have been like stepping off a cliff and hoping for a good result. Now at the devalued prices, the risk is more like stepping off a curb. If there was ever a time to take back control of these power companies and return them to the safe and valued companies they once were, now is the time. Taking control of these companies would protect the stockholders’ investment and prevent the irresponsible gambling with company funds that we have seen over the past nine years. Those funds could have beenused for better service, reinvestment in infrastructure and building new facilities with the goal of making Maryland an energy exporter rather than what we have become, an energy importer. That would be the best result for everyone involved, except for the few high-powered CEO’s
who have destroyed these once-great companies.
Delegate Rick Impallaria
Buy Low, Sell High: How Low Can The Dow Go?
October 12, 2008
The adage is to buy low and sell high. Americans, and world denizens, have been buying high from the stock market for more than a decade. The stock market was driven up to historic highs, and generally peaked at a Dow Jones 14,903 on October 12, 2007, a year ago today (Sunday).
Over the past year the price of gold has hit historic highs, although it is down to $849 per ounce today. Investors have been selling diminishing stock values for increasing gold values. Continue reading Buy Low, Sell High: How Low Can The Dow Go?
Burning Down the House: What Caused Our Economic Crisis?
October 8, 2008
The government has now approved a record $700 billion plan to try to stabilize US–and world–financial markets. The plan is not a total bailout as the media describes it; it is more of a government purchase of the stock of failing companies. The government is expecting a return on it’s investment, and, who knows, perhaps Uncle Sam will actually make money on this “deal.”
Of course, the government is doing the negotiating, so instead of using leverage to buy anything worthwhile, such as the senior preferred stock that Warren Buffet gets when he takes over a company (senior preferred stock gets paid first when dividends are awarded) the feds are getting non-voting stock. There is also no mandate that the stock be bought back, which means that a portion of the $700 billion will go to lobbyists maneuvering to have the stock perpetually “floating” so that it’s never actually repaid. Continue reading Burning Down the House: What Caused Our Economic Crisis?
NYC Is Just A Hop, Skip And Train Ride Away From Aberdeen Along the Rail Line
July 11, 2008
We get to the park and ride at 6:06 a.m. Wednesday, June 25. It costs nothing to park. Printing out tickets is a breeze - swipe your card, confirm, print. Departure is at 6:35 a.m. and it is ON TIME. Yay!
We sit in the café section of the Amtrak that has big open booths. My niece Paula sets up her iPod. I set up my laptop on the spacious table and plug it in - not wasting the battery. I’m on wireless so now I just have to get it working. When we begin to move, she looks around and takes it in, her eyes wide and that smile is just brewing. “This is amazing,” she says. I haven’t heard this 14-year old say much of anything with a 5 a.m. wake up call. We are in for a treat alright. Continue reading NYC Is Just A Hop, Skip And Train Ride Away From Aberdeen Along the Rail Line
For Sale: One Kidney, Used But Not Abused
April 30, 2008
Does anybody out there need a kidney? Sure, it’s not a question you hear everyday, but apparently Iran has a few we could order up if you answered “yes” . What do you say?
Iran is not usually a country we look to in order to draw ideas from, especially fiscally driven ones. But it seems that they have an incredibly successful organ vendor program.
Transplant nephrologist Benjamin E. Hippen out of North Carolina recently published a paper called “Organ Sales and Moral Travails: Lessons From the Living Kidney Vendor Program in Iran.”
If you are shaking your head at this point asking if I am serious, indeed I am. Here are some excerpts from Dr. Hippen’s paper… Continue reading For Sale: One Kidney, Used But Not Abused
Super Bowl Sunday: Music, Food, Celebrities and, yes, even a little Football
February 1, 2008
Not a fan of the Patriots? Not a fan of the New York football Giants? Maybe football is just not your thing? Surely you know by now that there are other reasons that people tune in to the ‘big game,’ which airs Sunday on Fox at precisely 6:17 pm. Here is a sampling of some of my faves:
- First and foremost, I have to tell you about one of the greatest days that my husband, Neil, and I shared together. We were fortunate enough to be at the dance when the Baltimore Ravens beat the New York Giants in Tampa at Super Bowl XXXV. Let me tell you something: watching the half-time show was impressive. The performances were good, yes, but what I am really referring to is the construction and deconstruction of the stage on the field and how quickly they got it done.
That year MTV was responsible. After the first half convened and the players went to their locker rooms, the mammoth stadium screens came on and Ben Stiller, Adam Sandler and Chris Rock did pre-recorded skits with some of the musicians featured in the show. This bought time for the stage to get set. The field was dark. We could see all kinds of goings-on (when we weren’t watching the skits). It was amazing because once the show started: lights, camera, action! It was a full-scale production going on. Those girls and guys who worked diligently behind the scenes deserve major props. Continue reading Super Bowl Sunday: Music, Food, Celebrities and, yes, even a little Football
Up in Smoke: A Cigarette-Lover Supports the Maryland Smoking Ban
February 1, 2008
We’re taught early in our school years that tobacco was first discovered upon European’s adventures to North American Indian territory. Cheek and jowl with its addictive quality, tobacco use quickly went ‘Internationale,’ pretentiously inhaled among the upper classes.
It wasn’t until the late 18th century that smoking was perceived as vulgar by, “the arbiter of high fashion in high society in London, Tunbridge Wells and Bath, George Brummell. Beau Brummell, succeeded in making it unacceptable for nearly 80 years. Then in the 1860’s smoking reemerged, influenced by royalty and the aristocracy.”
Now, nearly a century and a half later, smoking is once again under siege, for reasons unbeknownst to the earlier pretenders of fashion and spiritualistic tradition. Scientific advances, health research and taxations are culminating to produce mixed signals regarding the use of tobacco products. Continue reading Up in Smoke: A Cigarette-Lover Supports the Maryland Smoking Ban
Housing Market of Horrors: A 20-Something’s Guide to Buying a Home
January 30, 2008
Since the housing market began its dramatic landslide last year, I’ve been pushing my fiancé to buy a house under the impression that this may be the most affordable time for first-time buyers. There’s a lot of real estate out there for sale, most of which has been sitting stagnant for several months. The lenders and agents continue to harp that this is a buyer’s market. And they’re right—it’s the best time to be a buyer if you’re not trying to sell a house first and have 20 percent to put down.
Being 20-Something Today
I’ve learned a lot since I started looking at homes, and one of those lessons is that unless you can put 20 percent down on a house, you’re monthly mortgage is going to be painful. There isn’t a lot of incentive for young people just getting started to do anything other than rent, because renting is still much cheaper here in
More and more kids are attending college, and not all of those kids have rich parents to pay off the debt that builds while in school. I’m pretty lucky, but not lucky enough. I had a $10,000 scholarship, and the rest of my debt was split between my parents and me. I worked part-time between classes, and after I got a decent job with my B.A., I started making payments on the other half of my debt. Five years later and I’m still hurting enough that when I looked at the mortgage estimate the broker gave me, I cringed. Continue reading Housing Market of Horrors: A 20-Something’s Guide to Buying a Home
The Liberal Press: More myth than fact
January 7, 2008
The MoBseen: Observations as seen through the eyes of Mark
The Liberal Press. A moniker used to describe America’s media. Media of all sorts; radio, print media, and TV and the Internet. For years I’ve wondered how this term came to describe the media and reporting in the United States.
In my mind, it flew in the face of what I saw and heard and read on a daily basis. The likes of Rush Limbaugh, Anne Coulter, Imus, Bill O’Reilly, Sean Hannity, Martha Zoller, Pat Buchanan, Laura Ingraham, Glenn Beck and a laundry list of other talk show hosts are widely syndicated, very popular and all very conservative.
Many, such as Limbaugh, Imus and Coulter, to name a few, have become media icons. Very recognizable, syndicated in dozens of cities and consequently very rich. Many of these conservative talk show hosts also write columns in major market newspapers, are guests on TV news shows, are active in the world of blogging and all have their own web sites devoted to their point of view. They all have access to worldwide media that allows them to state their point of view. Continue reading The Liberal Press: More myth than fact
Horse Racing in Maryland, a $2 Billion Industry? Wanna bet?
December 10, 2007
The MoBseen: Life’s observations as seen through the eyes of Mark.
We, the voters of the Free State, will have the chance to vote on slots coming to Maryland.
Current polling by Gonzales Research & Marketing Strategies and the Washington Post Polling suggest that Maryland residents are in favor of Maryland slots and those favoring slots continue to outnumber those opposing slots. The question remains of course, where to put the parlors and who will be the beneficiary of the millions generated by this new gambling.
I should point out to those opposed to Maryland slots that we already have gambling in Maryland and on a very broad scale; We have The Lottery, Lotto, The Daily Pick 3, The Daily Pick 4, (twice a day!) Bonus Match 5, Mega Millions, Multi Match, Racetrax, Maryland Hold’em, Keno, Scratch-Offs, and of course horse racing. We also have Off Track Betting (OTB) and XpressBet.
The fact is, we have no shortage of vehicles to separate money from man and woman here in the Free State! These, of course, are all state-ordained gambling games. This in addition to all of the illegal numbers that are run everyday and the illegal slot machines in bars throughout the state, bingo nights at churches, VFWs and fire halls (these licensed by the State) and of course the office pools during March Madness.
The politicians, led by the both Governors Ehrlich and O’Malley, have and are supporting slots. This in itself is not what puzzles me, it’s the justification that is used to “sell” the slots to the constituents. Continue reading Horse Racing in Maryland, a $2 Billion Industry? Wanna bet?
