Baltimore Gas and Electric Co. is fighting to keep private an internal memo that details its deal with the city to continue using Baltimore’s underground conduit system.

The Office of the People’s Counsel, a state office that advocates for the state’s utility consumers, asked the Maryland Public Service Commission last month to make the memo public. According to its filing with the commission, the confidential memo explains how BGE potentially seeks to profit from the deal by having its customers pay for investments in infrastructure that the utility does not own.

BGE and the city agreed to the deal in February. That month, BGE asked state regulators to approve a rate increase for customers, which would go into effect Jan. 1 if approved.

The Office of the People’s Counsel also argued that the company’s customers deserve to understand why they are paying for costs related to investments in infrastructure not owned by the company.

People’s Counsel David Lapp said that BGE may be “taking a cost for which the utility does not” receive a return under state law “and trying to transform it into one that does.”

Under state law, utilities like BGE are entitled to receive a return on investment for the costs of operating and serving all customers.“We are very concerned that BGE is expanding the sorts of costs that it wants to earn a profit on,” Lapp said.

In the Oct. 26 filing obtained by The Baltimore Sun, the people’s counsel argued that unnecessary confidentiality “makes the regulatory process opaque and harms the public interest.”

“We think that this is an important issue that extends beyond this particular document,” Lapp said. “It touches on the public utility’s role as a public service company and providing services of incredible public importance, both in terms of the services provided and the cost charged to customers, and the arrangement with Baltimore City is a great illustration of how important transparency is.”

BGE says the document should remain confidential and is protected by “accountant/client privilege.”

BGE’s proposed deal with the city would require the company to pay an occupancy fee and spend $120 million for capital improvements to the 700-mile conduit system by the end of 2026. It would allow for a three-year extension requiring BGE to spend an additional $92 million by the end of 2029.

The city owns the underground utility system and pays to maintain it and rents out the space. As the system’s biggest user, BGE occupies 76% of it.

Earlier this year, the Office of the People’s Counsel warned that the proposed plan could cost BGE customers hundreds of millions of dollars over 50 years.

Lapp said Thursday that there is a “big blank box” regarding the cost of the lease payments for the conduit system after the current agreement expires.

In a Nov. 7 response to the Office of the People’s Counsel’s filing, BGE argued that the internal document in question is privileged. Under Maryland law, communications between an accountant and their client are not to be disclosed without the express permission of the client.

BGE spokesman Nicholas Alexopulos told The Sun in an email that the confidential document “provides analysis conducted by and conclusions reached by BGE’s accountants” for the expenditures under the conduit agreement with the city.

“Even though the memo supports our position and would benefit us if released publicly, it should remain confidential because it is statutorily protected by accountant/client privilege (much like attorney/client privilege),” Alexopulos wrote.

Lapp said his agency does not believe that BGE has made a substantive case as to why the document should not be made public “beyond sort of a sweeping claim that, because it involves accounting, it should be privileged.”

Alexopulos said that BGE “negotiated in the best interest of our customers,” and that conduit costs will be collected from customers over time “as opposed to immediate dollar-for-dollar maintenance fee recovery, reducing the impact on customer bills.”

“Our investments in the conduit system are absolutely vital to our work to further improve the safety and reliability of our electric system for customers in Baltimore City,” he said.