PSC grants most interruptible‑service penalty waivers but denies one; commissioners urge review of who should be eligible for interruptible rates

The Public Service Commission on June 4 considered five requests for waivers or reductions of penalties assessed when interruptible customers continued to take gas during a system curtailment earlier this year. Kenneth Alberts and engineering staff presented five cases involving a mix of hospitals, a senior residential facility, a university and a dairy. Staff grouped the requests into three buckets: (1) events beyond the customer’s control, (2) partial customer fault, and (3) customer fault where backup equipment lacked sufficient capacity.

Staff explained the penalty framework in utility tariffs: an interruptible customer that consumes gas after an interruption directive is subject to a per‑therm penalty plus an additional charge tied to the highest actual purchase price the utility paid during the curtailment. For Washington Gas Light (WGL) the tariff describes a $3 per‑therm unauthorized consumption penalty plus an additional multiplier on the utility’s highest purchased gas price during the event.

Asbury Atlantic LLC (a senior living facility on WGL service) told commissioners it switched to oil but supplemented with roughly 1,000 therms of gas over a two‑day curtailment when temperatures and regulatory obligations for resident safety required additional heat. Washington Gas confirmed Asbury had long been an interruptible customer and that the company requires an annual winter‑preparedness packet and a certification of interruptible capability. The commission voted to reduce Asbury’s penalty by 50% with commissioners Linton, Sussman and Barbet voting aye. Staff and commissioners noted Asbury intends to move to firm service.

Sinai Hospital of Baltimore reported an unexpected mechanical failure in its oil backup system that caused eight hours of noncompliance during a 72‑hour curtailment. Engineering staff confirmed Sinai passed a physical interruption test in November 2024 and that hospital staff acted quickly to repair the oil system; staff recommended granting Sinai’s waiver request. The commission granted Sinai a full waiver (three commissioners voting aye).

Notre Dame of Maryland University said it had tested its boilers and prepared for the interruption but experienced boiler problems during the curtailment; staff recommended a partial waiver because not enough preventive work was completed prior to the interruption. The commission reduced Notre Dame’s penalty by 50% (three aye votes).

Cloverland Farms Dairy failed two required physical interruption tests in the 2024 testing season; under BGE’s tariff a waiver is only available for customers penalized for failing to stop gas during the interruption event, not for failing the precurtailment tests. Staff concluded the tariff contains no waiver mechanism for failed physical tests and recommended denial. The commission denied Cloverland’s waiver request (three aye votes to deny).

Perry Point VA Medical Center was noncompliant for 61 of 72 hours after a cascade of boiler malfunctions and, in staff’s view, some local maintenance staff lacked experience restarting boilers on oil after a steam‑pressure event. Staff recommended a substantial reduction rather than a full waiver; staff proposed a 75% reduction in the distribution penalty so the final assessed amount would roughly match the prior year’s savings the facility had enjoyed as an interruptible customer. Commissioners voted to grant a 75% reduction in the distribution penalty (three aye votes). Perry Point said it has a boiler replacement project under design and intends system upgrades.

Commissioners and staff repeatedly emphasized the system reliability rationale for the interruptible‑service rules: interruptible customers (large users offered lower rates in return for agreeing to stop taking gas on peak days) reduce overall demand on cold days. If interruptible customers fail to comply, firm residential customers can be at risk and the utility’s delivery capacity may be strained. Several commissioners questioned whether hospitals and residential care facilities should remain eligible for interruptible rates and asked staff to reexamine eligibility criteria for interruptible service.

Votes at a glance: Asbury Atlantic LLC — penalty reduced by 50% (aye: Linton, Sussman, Barbet). Sinai Hospital of Baltimore — waiver granted (aye: Linton, Sussman, Barbet). Notre Dame of Maryland University — interruption penalty reduced by 50% (aye: Linton, Sussman, Barbet). Cloverland Farms Dairy — waiver denied (aye to deny: Linton, Sussman, Barbet). Perry Point VA Medical Center — distribution penalty reduced by 75% (aye: Linton, Sussman, Barbet).

Why this matters: The rulings resolve individual hardship and compliance questions but also raised policy choices about who should be eligible for lower interruptible rates when those customers perform critical human‑services functions. Staff and commissioners signaled a desire to review eligibility and tariff language to reduce the chance of system reliability risk in future peak events.

Sources: PSC administrative meeting transcript, June 4, 2025; staff engineering summaries and parties’ filings.