Baltimore, Maryland (October 1, 2024) — Today, the Retail Energy Advancement League (REAL) filed a lawsuit challenging the recently enacted Senate Bill 1 (SB1), which restrains retail energy companies from truthfully marketing their clean energy products to residential customers in Maryland, in violation of the First Amendment to the U.S. Constitution and Maryland state law. 

For decades, Maryland residents have enjoyed the right to access a variety of offers in the competitive energy market, shop for the supply portion of their electric bill, and choose a plan from a retail energy supplier instead of the default utility supply service. Many Marylanders choose to exercise this freedom by selecting green power alternatives offered by retail energy companies.   

SB1, sponsored by Senator Augustine (D-Prince George’s County) and Delegate Crosby (D-St. Mary’s County), was signed into law in May despite more than 3,000 Maryland residents advocating against the legislation. Disguised as a consumer protection bill, the actual impact of SB1 is to prohibit retail energy companies from truthfully representing that certain voluntary renewable energy credits (“RECs”) they offer consumers are “green.”  That severely restricts the ability of retail energy suppliers to compete against the utility and continue offering existing popular products and plans. 

In Maryland, more than 300,000 residential customers exercised their right to choose a supplier and many of those customers chose a 100% renewable energy product instead of default service. Under SB1, many, if not all, of those customers could have their current contracts canceled on January 1, 2025.  

“This is a great program, so for the people who are not diligent or maybe who are not as informed, it would be great if the government, instead of concentrating on trying to regulate what the companies are doing, would advocate for the program and educate more consumers on their options,” said John Walther, a Baltimore City resident.

“If this law is allowed to take effect, it will drive renewable energy providers out of the Maryland market, leaving hundreds of thousands of consumers without access to clean energy and forcing them back into outdated, fossil fuel-dominated supply,” said Chris Ercoli, President and CEO of REAL. “Our organization remains committed to protecting consumer choice and defending Maryland’s clean energy market. We must preserve the principles of competition and innovation in Maryland’s energy sector and urge lawmakers to revisit this harmful legislation,” said Ercoli.  

Maryland’s current Renewable Portfolio Standard (RPS) requires both utilities and suppliers to source 36% of the electricity sold in the state with premium RECs from specific types of energy resources and geographic areas.  

Prior to SB1, retail energy suppliers could market plans as “100% renewable” by obtaining an additional 64% of voluntary RECs, typically from sources within the U.S.  After SB1, retail energy suppliers are prohibited from calling these offerings “100% renewable.”  To use those words, SB1 requires retail energy suppliers to obtain at least 51% of their RECs from the Maryland RPS-compliant premium RECs and only 49% from other sources—even though it is indisputable that the offering is in fact “100% renewable” even if the RECs do not meet the criteria created by the Maryland RPS.   

Expanding, instead of restricting access to the voluntary REC market, is critical to achieving GHG emission reduction targets. According to the Environmental Protection Agency, “Consumers can play a significant role in transforming the power sector by creating demand for renewable electricity. This not only increases the proportion of total electricity being generated from clean, renewable resources but also helps to scale the market for these technologies and products, helping to bring per-unit costs down for future renewable projects.” 

The legislation also directs the Maryland Public Service Commission to set an annual price cap for all RECs marketed as green energy by retail energy suppliers. 

REAL’s lawsuit explains that the marketing restrictions on renewable energy plans in SB1 are unconstitutional, as REAL’s members use the terms prohibited by statute consistently with the guidance set forth by the EPA and Federal Trade Commission to highlight to consumers the environmental benefits provided by voluntary RECs. SB1 prohibits retail energy suppliers from using words such as “renewable,” “green,” and “clean” to market and communicate truthful information to customers about how plans with voluntary RECs can help reduce carbon emissions and combat climate change, among other benefits. 

“For more than a decade, Maryland residents have supported clean energy through 100% renewable energy plans for their homes,” says Christy Nagle, Head of Retail at CleanChoice Energy. “It’s one of the easiest ways people can make the biggest impact on the environment. CleanChoice Energy customers have replenished more than 10 billion kilowatt hours of clean energy onto the electric grid, and we are proud to enable their energy choice.”

“Our customers know the impact that choosing renewable sources of energy can have on the environment,” said Mike Rombach, vice president of Green Mountain Energy. “By eliminating our ability to market our products to Maryland residents seeking to contribute to a cleaner, greener energy future for America, we are not only limiting consumer choice but also hindering progress toward environmental sustainability and continued investment in renewable energy sources.”

The prohibited and compelled speech provisions contained in SB1 violate the First Amendment to the U.S. Constitution and Article 40 of the Maryland Declaration of Rights. These and other restrictions imposed by SB1 will cause irreparable harm by stifling suppliers’ ability to market their products, thus leading to a loss of business and consumer choice in Maryland’s energy market. 

REAL filed the motion for a preliminary injunction in the United States District Court for the District of Maryland, asking the court to provide relief before the new law’s speech restrictions become effective on January 1, 2025.

The post Lawsuit Against State of Maryland Seeks to Protect Access to Clean Energy Options for Consumers first appeared on Retail Energy Advancement League.

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:

• Green Mountain Energy – All Nighter for EVs
  • Customers in the BGE market receive electricity generation that includes a 10% Solar Renewable Energy Credit (“REC”)-based plan (90% Wind) and lower electricity prices at night from 10 PM to 7 AM.
• Inspire Clean Energy – Power Local
  • Customers in Maryland can select a plan that purchases RECs from specific regional wind farms. Power Local provides greater transparency and gives customers the opportunity to support local clean energy development.
• Ambit Energy – Winter Break 12
  • Customers automatically receive a 50% discount off energy supply charges on bill cycles beginning November 1st through the end of February.
• CleanChoice Energy – Google Nest Thermostat or Google Nest Hub 2
  • Customers will receive a Google Nest Thermostat or Google Nest Hub 2 in the mail if they are enrolling in new CleanChoice Energy service.
• NRG – EV Power Charger Plan
  • After two months of service, customers in the BGE service territory will receive an Emporia EV L2 charger with TOU pricing and reduced electricity supply rates during off-peak hours.

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

The post SB1 Veto Letter to Governor Moore of Maryland first appeared on Retail Energy Advancement League.

ANNAPOLIS, March 13, 2024 – Maryland customers, companies and organizations have mobilized in opposition to Senate Bill 1, sponsored by Senator Malcolm Augustine, which would block retail energy suppliers from offering innovative energy products that compete with the utility basic service offering.

The passage of this bill bans long-term fixed contracts that shield customers from frequent utility rate hikes. The legislation also bans all products priced higher than the utility rate, even if there are additional value-added benefits, such as 100% renewable energy plans (the utility supply is only 37% renewable energy), free EV charging equipment and free nights and weekend charging and innovative time-of-use programs that incentivize customers to reduce usage during peak demand by offering free electric vehicle charging or special rates.

As suppliers are being banned from offering these products, electric utilities have received approval to fund these types of programs through customer rates, including the cost of research and development, advertising and deployment of these types of programs, even if the customer isn’t participating in the program.

“This legislation was developed in a vacuum with no input from market subject matter experts. As a result, the legislation does not accomplish the goal of improving consumer protections, but it does have the unintended impact of blocking a range of value-added products that customers have chosen, which play a crucial role in meeting state decarbonization goals,” said Christopher Ercoli, CEO of the Retail Energy Advancement League (‘REAL’). “This legislation will restrict retail suppliers to offering only basic supply like the utility. It is a market killer.”

At a February 15 Economic Matters Committee hearing, John Hanger, former Pennsylvania Utility Commission, Department of Environmental Protection Secretary and consumer advocate said, “This bill would kill long term contracts . . . The price cap would kill just about every green energy offer.”

In Maryland, almost 500,000 residential customers chose to enroll with an alternative energy supplier in 2023, and many of the products these customers chose will be banned if this legislation passes.

“I appreciate the option of choosing the least expensive source of energy,” said Robert Koch in Anne Arundel County.

In the last two weeks, more than 1,200 Maryland customers have contacted their legislator asking them to oppose the legislation.

“I like to compare options on the PSC website and lock in a rate for 1 to 3 years if rates are relatively low.  I appreciate the sponsors’ intention to reduce abuse and predatory pricing, but limiting future prices to the prior trailing price will preclude fixed price contracts when market conditions require a price that is above the prior price,” said Steve Shapiro in Montgomery County.

“Energy costs, like everything else, have gone through the roof. I want competition and to find the lowest price. Robbing me of this costs me and my family money,” said Aaron Hoge in Wicomico County.

While Maryland customers have voiced their preference to retain their retail supplier, they have been overlooked. The bill passed the Senate on March 8 and has moved to the House for consideration. The proposed legislation would force Marylanders to switch back to utilities, contradicting their expressed desires.

“My money, my choice. I’m tired of politicians trying to make every discussion for me or telling me what’s right for me; they don’t have my best interests,” said Robert Death in Anne Arundel County.

Retail energy industry leaders expressed their concerns with the legislation in a letter to Maryland Governor Moore, emphasizing the urgent need for action to prevent the legislation from becoming law. These leaders made clear that reputable energy suppliers may view the Maryland consumer market as closed for business, driving companies out and the cost of energy up.

“The legislation would effectively end renewable energy choice in Maryland and move our state back towards utility monopoly control,” said Tom Matzzie, Founder and CEO of CleanChoice Energy, a retail energy supplier. “As a climate activist and a Maryland resident it would pain me greatly to be forced to buy the dirty energy mix sold to me by the monopoly utility. Maryland should not deprive customers like me of this choice.”

This legislation comes at a time when the Maryland Public Service Commission is reviewing the market and opportunity to improve consumer protections and market structures. REAL recommends these proposed reforms from the legislature be reviewed in the regulatory process so all associated impacts are assessed and stakeholders have an opportunity to participate in the process.

Senate Bill 1 significantly disadvantages both consumers and businesses alike. Opponents urge policymakers to reconsider the implications of this legislation and work towards solutions that uphold the principles of competition, consumer empowerment, and environmental sustainability.

Marylanders can take action by texting EnergyMaryland to 844-435-9600.

About Retail Energy Advancement League (‘REAL’)

REAL is a national advocacy organization dedicated to the expansion and modernization of American retail energy markets.

Established by a coalition of companies advocating for smart regulation and consumer protections, REAL engages with commissioners and regulators in 10 states, including Maryland, to promote competitive markets and strong consumer safeguards through discussions, forums, and proactive engagement.

For media inquiries, please contact

Max Lifton

lifton@retailenergychoice.org

The post Legislation to Block Energy Choice Elicits Public Outcry from Maryland Customers, Companies and Organizations first appeared on Retail Energy Advancement League.

Dear Governor Moore:

We are writing to express our deep concern with Senate Bill 1/House Bill 267. As currently drafted, and contrary to how it is being positioned, this bill is anti-consumer, anti-business, and anti-environment. If passed, it will drive business out of Maryland, drive up the cost of energy, and take choice away from Maryland consumers.

We urge you to prevent this legislation from becoming law. The legislation reflects a misapprehension of the energy industry, and well-established business practices of companies that have responsibly served Maryland consumers for many years. Above all it does not reflect your goals for Maryland. If you sign this bill, Fortune 500 companies, like NRG and Constellation, as well as many other reputable suppliers like the undersigned, will view the Maryland consumer market as essentially closed for business. Ironically, in an attempt to clean up the market, the legislation could simply leave it with only the worst actors.

This bill irreparably harms Maryland’s ability to meet legislatively mandated 2050 climate goals, and your agenda to attract more innovation and business investment to Maryland. It also sends a clear message to the almost 500,000 Maryland customers that currently shop that their preferences are irrelevant and that their energy supply service will be re-monopolized under orders from the state. They will know that their choices are of no consequence. What will Maryland choose for them next?

We are asking you to make an executive decision to move the energy market forward and not set it back 100 years. Encourage the Public Service Commission to ensure that Maryland consumers are protected and have the ability to choose the products and services that meet their own needs as was intended by the Electric Customer Choice and Competition Act of 1999.

We request an opportunity to meet with you and discuss our concerns and sincerely appreciate your efforts to keep Maryland open for business.

Sincerely,

Larry Coben, CEO – NRG Energy

Michael Stein, CEO – Genie Energy

Dan Verbanac, SVP – Constellation

Scott White, President and CEO – IGS Energy

James Bridgeforth, President – American Power & Gas

Scott Hudson, President – Vistra

Michael Carter, CEO – Just Energy

Robert Palmese, President and CEO – Indra Energy

Tom Matzzie, Founder and CEO – CleanChoice Energy

Paul Keene, CEO – Tomorrow Energy

The post Retail Energy Industry Letter to Maryland Governor Wes Moore first appeared on Retail Energy Advancement League.

• 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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