February 6, 2024
On January 25th, the Retail Energy Advancement League (REAL) presented concerns about Senate Bill 1 (SB 1) before the Maryland Senate’s Education, Energy, and the Environment Committee. SB 1 has sparked intense debate over its potential impact on the state’s energy landscape.
- REAL opposes SB 1 due to the bill’s lack of substantive consumer protections and educational measures.
- Opponents believe that SB 1 poses a threat to Maryland’s competitive energy market established in 1999, known for fostering innovation and providing consumers with diverse choices.
The competitive energy market has historically flourished, offering substantial benefits to consumers:
- As of Dec. 31, there were 273 retail supply options listed on the state-managed website mdelectricchoice.com, with 110 offering fixed-price plans lower than the default utility rate, resulting in immediate savings for Maryland consumers.
- 98 options provided 100% renewable energy, with 35 being both environmentally friendly and more affordable than the default utility rate.
- Potential savings for Maryland residents were estimated at $59,831,935 in December 2023 alone, highlighting the tangible benefits of the existing competitive market.
Supporters of SB 1 argue it addresses systemic challenges in Maryland’s energy sector:
- They emphasize consumer safeguards in the bill, including license renewals, addressing teaser rates, and enhanced penalties against predatory practices.
However, opponents, including REAL, NRG, IGS, CleanChoice, WGL, Legacy Solar Partners, RESA, and former PUC commissioner John Hanger, express concerns:
- They highlight the importance of a well-functioning competitive retail market with robust consumer protections.
- Concerns range from issues related to Renewable Energy Credits (RECs) to potential impacts on pricing of renewables and compliance.
REAL supports reporting complaints and identifying bad actors for consumer well-being:
- Existing avenues for addressing concerns have been effective, with complaint rates averaging less than 1 in 10,000 customers.
A critical concern raised by REAL is SB 1’s attempt to regulate pricing, a jurisdiction the Public Service Commission (PSC) currently does not possess:
- This could represent a fundamental shift with potential adverse consequences for the market and consumers, stifling innovation in the industry.
Maryland has already taken measures to address concerns:
- The PSC initiated a docket to identify and implement additional consumer protections, and REAL expresses a willingness to collaborate.
- Regulations are in place to safeguard consumers receiving energy assistance funds, ensuring they don’t pay more than the standard offer service (SOS) price.
REAL contends that SB 1, in its current form, poses a threat to the well-established and effective competitive energy market in Maryland. We remain committed to working collaboratively with the PSC to address legitimate concerns while preserving the principles that have driven Maryland’s energy success thus far.
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The Retail Energy Advancement League (REAL) is a national advocacy organization dedicated to the expansion and modernization of American retail energy markets. In many states, utility monopolies still control the electric market and customers can’t choose where they buy their electricity and gas.
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