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PSC takes GAF Materials' interruption-penalty waiver request under advisement after lengthy hearing
Summary
The Public Service Commission took under advisement GAF Materials LLC’s request to waive or reduce a BGE interruption penalty after the company failed to fully curtail gas use during a scheduled interruption because a critical safety thermocouple was unavailable.
GAF Materials LLC asked the Public Service Commission to waive or reduce a penalty assessed by Baltimore Gas and Electric Co. (BGE) after GAF failed to cease gas usage during a scheduled interruption in January 2025. The commission took the matter under advisement after a detailed hearing in which staff recommended a 25% reduction and commissioners questioned whether GAF should remain on interruptible service.
What happened: GAF did not comply fully with an interruption that began Jan. 20, 2025, because its south furnace required a replacement thermocouple — a safety device that monitors overheating — and a replacement part could not be obtained quickly. GAF operates two furnaces at its Baltimore facility; the south furnace is the only one permitted to run on No. 2 fuel oil under the facility’s air permit. Staff said GAF reduced natural gas usage during the interruption but continued to use gas on the north furnace and used fuel oil where permitted.
Staff recommendation: Cameron Walton and the engineering division reviewed the technical record and recommended a 25% reduction in the assigned penalty because the equipment failure and supplier delay were unforeseen, GAF documented efforts to reduce usage, and the company took corrective actions after the event (installing a new thermocouple and securing a spare). Staff presented a reduced penalty amount of $517,093 after applying the 25% reduction.
Company position: Counsel Colin Wojcowski and GAF representatives said the company made a good‑faith effort to comply, prioritized worker safety (declining to run the south furnace without a safety thermocouple) and had a long history of participation in the interruptible program without prior compliance issues. GAF initially sought a full waiver but said it would accept the 25% reduction if the commission chose that remedy.
Commissioner concerns: Several commissioners (including Barbet, Sussman and Barbay in their remarks) questioned whether a high‑use industrial customer that cannot reliably curtail on interruption notices should remain on interruptible service. Commissioners raised the possibility that continued participation on interruptible rates by unreliable participants creates a moral‑hazard problem for the system and other customers. Commissioners also pressed whether GAF explored alternatives such as temporarily switching to an uninterruptible schedule or fully shutting down operations during the interruption; GAF said a full shutdown risked equipment damage and safety challenges due to cooling and solidification of asphalt within the system.
Office of People’s Counsel: Juliana Bell noted that residential ratepayers have an indirect interest because interruption penalties are redistributed to customers through BGE’s bill stabilization adjustment; OPC did not take a specific position on the exact penalty amount but urged caution in treating interruption notices as suggestions.
Commission action: After extended questioning, commissioners determined they needed additional time to consider penalty policy and the specifics of GAF’s circumstances and took the matter under advisement; the commission said it will issue a formal order in due course.
Ending: GAF installed a replacement thermocouple and secured a spare after the interruption; staff recommended a 25% penalty reduction but the commission deferred a final determination to allow further consideration of reliability and penalty-policy issues.
