Lawmakers toss consumer electric bill refund into grab bag of energy bills

Yahoo

26-03-2025

Protesters, wearing shirts calling for "No New Gas," gathered Friday in Annapolis to protest the Next Generation Energy Act that was backed by House and Senate leadership. Senators heavily reworked the bill Tuesday. (Photo by Christine Condon/Maryland Matters)
Senators on Tuesday rolled a laundry list of energy bills together into one package aimed at reshaping Maryland's energy picture well into the future, and lowering costs in the process.
And they added one amendment designed to provide consumers more immediate relief.
In a two-hour session Tuesday, the Senate Education, Energy and the Environment Committee added bits and pieces of other energy bills to leadership legislation that had largely focused on expediting the construction of new power plants in the state.
But with Maryland residents face soaring electricity and gas rates, much of Tuesday's debate focused on the so-called 'Legislative Energy Hardship Credit' for residential customers.
'A lot of the things in this bill won't really take effect for a while,' said Sen. Mary Washington (D-Baltimore City and Baltimore County). 'We're probably planning in a way that maybe we should have done 10 years ago, 15 years ago. But this [consumer credit] … would go right into some pockets of Marylanders right away.'
Money for the rebates would come from the Strategic Energy Investment Fund, a state account utilities pay into as a penalty for not meeting certain renewable energy requirements. In fiscal 2024, the payments totaled $318 million, according to the Fund's most recent annual report, a considerable increase over prior years because it was often more economical to pay into the fund than buy credits from renewable-energy generators.
That fund has been used to pay for energy-efficiency projects, but it would be sent directly to consumers next year under the Senate proposal. The payments would come in two installments, applied to consumers' bills once in the summer peak energy season and once in the winter.
It's not clear how much ratepayers would receive, but the amendment says the rebates would be 'based on the customer's consumption of electricity supply that is subject to the Renewable Energy Portfolio Standard.'
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Sen. Cheryl C. Kagan (D-Montgomery) took issue with the fact that the refund would go to all residential ratepayers, regardless of income.
'I hate that someone who lives in a huge mansion is going to somehow be getting a hardship payment when they're not going to need it, notice it or appreciate it,' said Kagan, the vice chair of the committee.
The idea of a ratepayer rebate got the support of at least one Republican on the committee, Sen. Mary Beth Carozza (R-Lower Shore).
'Our constituents expect some type of immediate relief,' Carozza said.
While the rebates garnered plenty of the discussion, longer-term energy policy formed the larger part of the omnibus bill that senators cobbled together, with less than two weeks left in the legislative session.
The amended bill builds on a package endorsed by legislative leaders early in the session that would create a 'fast track' process to approve certain new power facilities in the state. But amendments set new limits on the process.
The bill would create procurement procedures for more nuclear power and energy storage technology, which could contribute stored power to the grid during peak times.
It also aims to rein in utility spending on natural gas infrastructure, by requiring companies looking to get rapid reimbursement from ratepayers to first show that new infrastructure is needed for safety reasons. It states that investor-owned utilities can't use ratepayer dollars on trade association memberships or private planes.
Environmental and consumer advocacy groups have long complained that a 2013 law meant to encourage updates to leaky gas pipes, called STRIDE, was actually causing utility companies to go overboard with upgrades, leaving ratepayers stuck with the tab, even as the state transitions from fossil fuel-burning.
'It [STRIDE] was passed to deal with aging infrastructure and there just weren't any sort of checks and balances as part of the original bill,' Washington said during Tuesday's work session.
The bill also takes aim at 'multiyear' rate plans, which — when approved by the Maryland Public Service Commission — let utilities raise rates annually over a period of several years, instead of coming to the PSC every time they wanted their next increase. Utilities would have to demonstrate a 'definite cost-savings to consumers' to be approved for multiyear rate increases under Tuesday's amendments.
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'If the legislature wants to address rising energy costs, the smartest thing they can do is stop relentless rate hikes from Exelon utilities by ending or reforming the STRIDE and multi-year ratemaking programs, and these proposals are a strong start,' said Emily Scarr, a senior adviser at the Maryland Public Interest Research Group, in a statement Tuesday.
The amended bill would also deny renewable energy subsidies to facilities that burn trash to generate energy. The development is likely to please environmental groups that had long fought against the subsidy, including in South Baltimore, which hosts one of the state's two incinerators.
Industrial facilities that use a large amount of energy (100 megawatts), such as data centers, were also targeted in the amended bill, which calls for utilities to develop a unique rate schedule for those customers, among other provisions.
'It is the intent of the General Assembly that residential retail electric customers in the state should not bear the financial risks associated with large loaf customers interconnecting to the electric system serving the state,' reads the amended bill.
Environmental groups pushed back against the energy pack originally proposed by House and Senate leaders, arguing that it was essentially encouraging construction of a new natural gas plants, flouting the state's climate goals.
At a recent Maryland League of Conservation Voters event in Annapolis, protestors donned T-shirts with the slogan: 'No New Gas! Don't Need It, Don't Want It.' Opponents have also questioned the notion that any new in-state power plants are needed at all.
'Maryland doesn't have a reliability problem. It has an affordability problem,' said Susan Miller, a senior attorney with Earthjustice, during the Annapolis conference.
The Maryland Office of People's Counsel, which represents ratepayers, has also cast doubt on the notion that the state's energy supply is perilous. Two coal-fired plants that were set to be retired, Brandon Shores and H.A. Wagner, will keep operating while new transmission lines are added to account for their loss, read a recent report from the OPC.
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'The relevant available data does not show that there is a near-term need for generation located in Maryland for reliable electric service,' the report said. 'The transmission system in place can import sufficient power into Maryland, and new transmission under development will increase that capability as power plants retire.'
The amended energy bill sets new guardrails on what types of energy generation can receive expedited approval.
For example, it says the combined total capacity of natural gas generators approved under the bill 'may not exceed the combined summer peak capacity profile of coal and oil energy generating stations in the state.' It also required four non-emissions emitting projects be approved for every one emissions-emitting project.
Sen. Jason C. Gallion (R-Cecil and Harford) took issue with the natural gas provisions during Tuesday's proceedings.
'We have an energy crisis in the state,' he said. 'I don't know why we would be capping natural gas.'
The amended bill requires that any natural gas plant approved through an expedited procedure at the PSC have the ability to convert to hydrogen or zero-emissions biofuel. After a new plant becomes operational, it would have to submit reports every five years regarding the feasibility of such a conversion.
Sen. Ronald L. Watson (D-Prince George's) worried about the 50-year time frame in the bill.
'A company goes in and submits their report, and then tomorrow, technology is available, and they get to burn unclean fuel for another five years before they have to do another report,' Watson said.