Southern Maryland Electric Cooperative

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Southern Maryland Electric Cooperative, Inc.
Cooperative
Industry Electric Utility
Founded 1937
Headquarters Hughesville, Maryland, USA
Key people
Joe Slater
Products Electricity
Revenue $370 million (2006)
Website smeco.coop

The Southern Maryland Electric Cooperative (SMECO) is an electric distribution cooperative which is headquartered in Hughesville, Maryland. SMECO serves approximately 144,000 customers in Calvert, Charles, Prince George's, and St. Mary's counties of southern Maryland. Under its rules as a nonprofit cooperative, SMECO passes on its costs to its customer-members without markup or profit.

SMECO owns a 77 MW combustion turbine located at the Chalk Point Generating Station which, by an agreement until 2015, is operated and maintained by Mirant.[1]

History[edit]

In 1937 two committees of citizens from three counties which were seeking aid to construct a local rural electric distribution system under the New Deal's Rural Electrictrification Administration formed the Southern Maryland Tri-County Electric Cooperative Association. This was reorganized as a cooperative under the SMECO name in 1942. Customers were allowed to select suppliers of electricity beginning in 2001 under the electric deregulation legislation enacted in 1999.[2] SMECO has won the J.D. Power and Associates Award for best customer service for the East region midsize utility for the past four years.[3]

FERC solar complaint[edit]

SMECO has filed a complaint with the Federal Energy Regulatory Commission (FERC), alleging that the Maryland Public Service Commission (PSC) coerced utilities into purchasing excess solar power generated by the state's community solar program at much higher retail rates rather than paying the amount it would have cost these utilities to create the power themselves, also known as the avoided cost. This would be in violation with the federal Public Utility Regulatory Policies Act (PURPA), which establishes that any payment given to such qualifying power plants equate the utility's avoided cost. In addition, PURPA mandates that these plants do not exceed 80 MW of power.[4]

Recently, the development of community solar programs has become increasingly prevalent in order to meet the ever-growing demand for new, viable energy sources; however, there has been much controversy regarding the surge in net metering consumers due to the resulting cost shifts which negatively affect the non-solar community now facing much higher payments to even out the increased benefits given to solar projects.[4]

Because of the continual reduction in the cost of power, FERC has become more concerned with the discrepancy between avoided costs and wholesale prices, which continue to prevail. This has placed more focus on PURPA's roles and responsibilities in the maintenance and balance of the current energy market.[4]

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