Maryland Senate OKs consumer protection bill for residential energy customers

ANNAPOLIS, Md. (AP) — Maryland would create consumer protections for residential customers who opt to buy electricity from retail energy suppliers, under a bill approved by the state Senate on Friday, though critics say it will hurt competition and chase energy companies out of Maryland.

The Senate voted 33-14 for the bill, sending it to the Maryland House, where a similar bill has been introduced.

Maryland deregulated its energy market about 25 years ago in response to high energy bills, but supporters of the legislation say that failed to lower prices.

Sen. Malcolm Augustine, who sponsored the bill, said the measure is needed to protect residential customers from deceptive practices by some suppliers, who send people door-to-door teasing lower energy rates that lock people into complicated agreements leading to higher prices, particularly in low-income areas.

About 300,000 Maryland energy customers pay roughly $150 million more on their energy bills under the contracts in 2022, Augustine said.

The bill would put a price cap in place that is designed to prevent residential customers from being charged above a standard offer of service, which would use a 12-month average to determine the price. Opponents contend the measure ultimately amounts to reregulating the energy market, but Augustine said the bill is designed to prevent energy suppliers from taking advantage of customers.

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“The thing is, it’s still an open market,” Augustine, a Prince George’s County Democrat, told reporters Friday morning before the bill passed. “If you can save folks money, we’re all for that.”

But opponents argued that the measure will hurt customer choice and increase prices. Sen. Steve Hershey, an Eastern Shore Republican, said the measure will chase companies out of the state.

“They’re going to be gone from the state of Maryland, because they’re not going to be figure out why they have to abide to some 12-month trailing average and why they have to be less than (standard offer of service),” Hershey said.

The bill also includes provisions for a green energy market. It would allow for flexibility for higher prices, if people decide to use green energy, Augustine said. However, the senator said the bill includes a guardrail that puts state regulators at the Public Service Commission in an oversight role.

“They’re going to make sure that they’re fair,” Augustine said.

The measures also includes licensing and accountability provisions for people who sell electricity.

“We strengthen penalties,” Augustine said. “We have training to make sure folks know what they’re doing. We have a strong education component, and reporting that makes sure that we have this robust open market, but it’s a place where Marylanders are treated fairly.”