The Honorable Wes Moore
100 State Circle, 2nd Floor
Annapolis, MD 21401
Dear Governor Moore:
On behalf of the Retail Energy Advancement League, a coalition comprised of retail energy suppliers operating throughout Maryland and the United States, we are writing to urge you to veto Senate Bill 1 and instead ask the Maryland Public Service Commission to exercise its jurisdiction in furtherance of the legislation’s purported goal of consumer protection. SB 1 is detrimental to Maryland consumers, businesses, and environmental sustainability. We anticipate that if this legislation is enacted into law, it will drive businesses away from Maryland resulting in the loss of thousands of jobs, an increase in energy costs, and severely constrained consumer choices.
Senate Bill 1 poses a significant threat to Maryland for the following reasons:
It is a de facto ban on retail services for residential customers
This bill, taken as a whole, implements a price cap currently lower than the incumbent utility and implements provisions that make it more expensive to conduct business. These provisions include limits on the maximum contract length for all residential electric and gas retail products to twelve months, removal of the purchase of receivables, and prohibition on automatic renewals for renewable electricity offers. This will make Maryland too expensive for our members to participate in the residential retail market.
It restricts innovation and business investment and undermines the State’s efforts to attract innovation and business investment.
Our members and other retail suppliers cannot offer residential products under the unprecedented constraints in this SB 1, which do not exist in any other state. In addition, the consequences of SB 1 extend far beyond competitive energy suppliers, reaching deeply into the fabric of our local economy. Countless businesses that rely on partnerships and contracts with these suppliers face an uncertain future. The potential fallout includes downsizing operations, leading to the loss of Maryland jobs and vital tax revenue streams. The repercussions of such actions would reverberate throughout our communities, exerting undue strain on both employers and employees.
It is counter to what nearly a half million Maryland consumers have said they want.
This legislation will affect nearly half million Maryland consumers who have chosen their energy providers—some of whom will be returned to standard offer service immediately and others who will lose their choice to renew or enter a new contract.
Long-term fixed contracts have been critical to protect consumers from regular utility rate increases and to provide consumers with the comfort of knowing what to expect month-over-month and year-over-year. However, this legislation will bring an end to this option.
Many Maryland consumers have benefitted from 100% renewable energy (when utility supply comprises only 37% renewable energy, on average), free electric vehicle (“EV”) charging equipment, and innovative time-of-use (“TOU”) programs. If SB 1 is enacted, Maryland consumers will not be able to benefit from these products or value added benefits. This legislation forbids the sale of any products priced above the utility rate. Unable to price adequately, it is unrealistic to expect or assume that suppliers will offer these products at a loss.
It undermines Maryland’s ability to meet its ambitious 2050 climate goals.
A few of the products that will be blocked from the market include:
Lastly, there are existing and forthcoming Maryland Public Service Commission (“PSC”) regulations.
SB 1 is an unnecessary intrusion into the authority and existing work of the PSC. Regulations are already in place to protect consumers from misleading and deceptive practices, ensure that consumers are knowledgeable about the energy products they choose, and require adequate notice to energy customers when their contracts are nearing their end. The PSC is currently working to identify and implement additional consumer protections and examine the purchase of receivables program in consultation with a variety of stakeholders. In 2023, the PSC launched a “maximum enforcement” campaign with the goal of investigating and prosecuting retail suppliers. These efforts contributed to a steep and sustained decline in consumer complaints between the first and second halves of 2023. We anticipate this will continue downward. We believe any consumer protection concerns will be highlighted and addressed through the PSC.
SB 1 significantly disadvantages consumers and businesses in Maryland. Despite the impassioned efforts of thousands of Maryland residents and employees communicating their apprehensions to elected officials, their voices continue to be unheard. For these reasons, we urge you to veto this legislation. We continue our commitment to remain at the table for ongoing and meaningful conversations to identify and address any gaps in consumer protections.
Sincerely,
Christopher Ercoli
President and Chief Executive Officer
Retail Energy Advancement League
