MD Governor Approves Bill, Restricts Energy Choice

Learn why Maryland's new law to protect low income utility customers could cut energy choice and raise everyone's electricity bills.

Reform Bill SB1 Signed Into Law

MD's governor signed a bill to protect low income consumers. But it drastically limits energy choice and could increase your electric bills.
Maryland’s new law will help protect low income consumers but it limits energy choice. Find out how it could increase everyone’s electricity bills.

Maryland Governor Wes Moore signed energy choice reform bill SB1 into law this week. While it preserves some parts of energy choice, it does enact some important changes. Of course, the big question is how will it change how you shop for cheaper electricity rates? Let’s talk about why Governor Wes Moore signed the bill and what it means for energy choice in Maryland.

Will Reform Bill SB1 Affect Energy Choice?

SB1 is intended to make the state’s retail energy market safer for customers. To do that, it places several limits on energy companies in order to protect consumers. These changes begin taking effect on January 1, 2025.

For example, energy suppliers can only hire “energy salespersons” licensed by the PSC. Also, energy suppliers cannot offer them commissions or sales incentives. This removes the motivation for high-pressure scam sales. It these sort of things that have harmed customers in the past.

Other provisions of SB1 include:

  • Plans may no longer exceed 12 months in length
  • Non-green plan prices cannot be above the 12-month SOS rate average.
  • Green plans may go above this rate with PSC approval
  • The bill also puts an end to purchase of receivables (POR) rule.

The POR rule is particularly important for customers. This rule makes local utilities buy the electricity supplier’s costs. Those include bad credit customers who fail to pay high bills. As a result, the POR rule let energy suppliers charge high rates. That left local utilities to absorb the cost of unpaid bills.

Energy Providers Respond To Save Customer Choice

As you can guess, SB1 did not pass without debate. Kevin Klages, of Constellation Energy, urged Governor Moore in the Baltimore Sun to veto SB1. Klages called SB1 a “blunt-force instrument that will eliminate consumer choices and savings”. He also argued SB1 could lead to legitimate businesses leaving Maryland.

In another Baltimore Sun opinion piece, Dave Arndt argued that Constellation is wrong about the legislation. Arndt counters that SB1 doesn’t stop energy suppliers from working in Maryland. It only requires companies to charge reasonable prices.

How SB1 Limits Energy Choice

MD energy choice has been around for about 25 years. To be sure, bad actors in the industry caused undeniable harm, especially to lower income families. That makes SB1 a huge win for energy justice advocates. And yes, Maryland energy customers could enjoy more protections when they shop for the best plans and promotions. Plus, by doing away with the POR rule, energy suppliers will need to face their own cost risks and charge better rates.

Still, SB1 robs consumers of the main idea behind energy deregulation in Maryland: choice. Consumers will be limited to plans lasting no more than 12 months. That’s significant because over the past 10 years, electricity prices have risen nearly 26%. And it’s very likely that trend will continue. So, SB1 takes away long term options that lock in low rates for 13 months or longer. These plans help shield Maryland consumers as utility rates rise.

It’s too early to tell whether or not SB1 will end Maryland’s retail energy market. Hopefully in the future, cooler heads will find a way to give consumers a broader range of choices while protecting everyone in Maryland’s energy market. And as that unfolds, you can keep finding the best information and electricity rates right here at

Leave a Reply

Your email address will not be published. Required fields are marked *