Maryland Power Bills Rise Due to Increased Transmission Costs and Utility Profits

As Maryland residents face escalating power bills during a sweltering summer, the focus has turned to the reasons behind these increases. Contrary to the blame placed on the competitive energy market by Maryland Energy Administration Director Paul Pinsky and BG&E Vice President Mark Case, data indicates that power generation costs have actually decreased by 20% over the past decade when adjusted for inflation. The real issue lies in the doubling of BG&E's monthly charges for delivering electricity since 2010, with an average annual increase of 5%, significantly outpacing the average inflation rate of 2.65% per year.

The Maryland Office of the People’s Counsel (OPC) study highlights that BG&E's parent company, Exelon, has committed to delivering annualized earnings growth of 5% to 7% through 2028 to its investors. This commitment has led to increased infrastructure spending, not necessarily for the benefit of ratepayers but to meet aggressive investor expectations. BG&E's guaranteed profit model, earning 9.5 cents for every dollar spent on the electric grid, incentivizes spending on projects that may not directly benefit customers, such as a $130 million substation for the stalled Baltimore Peninsula redevelopment.

Examples of questionable spending include charging customers for a $17.5 million contract for a Ford F-150 truck, raising concerns about the necessity and benefit of such investments to the public. While BG&E has announced $15 million in temporary assistance for struggling families, this amount is less than 3% of its $527 million in projected 2024 profits, highlighting the disparity between utility profits and customer relief efforts.

The situation calls for greater transparency and accountability from utilities like BG&E, ensuring that investments are made in the public interest rather than solely to satisfy shareholder expectations. Without significant changes, Maryland families will continue to bear the brunt of rising power bills, with little relief in sight.