Gas, Electric Costs Have Skyrocketed For Most MD Customers: New Report

BALTIMORE, MD — Maryland consumers are paying up to three times more for gas and electricity than they were less than 15 years ago, according to a new report from the state Office of People's Counsel.

Gas and electric delivery rates for many of the state’s largest utilities have skyrocketed since 2010, with some rates increasing by two or three times, according to the report. Meanwhile, customers continue to bear the brunt of massive rate hikes.

"Customers of most of Maryland’s largest utilities are facing staggering levels of cost increases for the delivery of their electricity and gas," Maryland People’s Counsel David Lapp said in a statement. "These increases reflect a concerted utility effort to boost profits by accelerating capital infrastructure spending, including massive spending on gas infrastructure that is at odds with state efforts to fight climate change."

Customers of Baltimore Gas & Electric, a subsidiary of Illinois-based Exelon Corp., have experienced the worst spikes, according to the report.

BGE's gas delivery rates have more than tripled since 2010 — nearly three times the rate of inflation — from 26 cents per therm in 2010 to 85 cents per therm in 2024, OPC’s report found.

Over the same period, the electric distribution rates of Exelon utilities Pepco and Delmarva Power more than doubled, rising from 2.6 cents per kilowatt to 6.2 cents per kilowatt and from 3.2 cents per kilowatt to 7.0 cents per kilowatt, respectively.

The rate increases differ across Maryland utilities, according to the report. For example, Potomac Edison’s rates have largely followed inflation, rising by less than one cent from 1.7 cents in 2010 to 2.2 cents in 2024. In comparison, Pepco’s rates increased by more than 3.5 cents over the same period.

The rates of Washington Gas, Maryland’s second-largest gas utility after BGE, have also increased slower than BGE’s rates. In 2024, Washington Gas rates were 46 cents per therm versus BGE’s rate of 85 cents per therm.

Meanwhile, Columbia Gas — the state’s third largest gas utility — had the highest increase in delivery rates with costs spiking from 30 cents per therm in 2010 to $1 per therm in 2024.

According to the report, the rapidly increasing rates correspond with significant increases in spending on infrastructure by companies. Examples of infrastructures include substations, poles, wires and pipes.

The increases in spending drive spikes in profit, the report states. Additionally, policies including the Public Service Commission’s 2020 multi-year rate plan pilot and the 2013 STRIDE statute for gas pipe replacement allow utilities to recover costs plus profits at an accelerated rate.

According to the report, the accelerated recovery of profits often fuels capital spending and the rate increases that follow.

"Highly profitable rate recovery mechanisms are helping drive massive rate increases and imposing significant burdens on customers," Lapp said. “It’s past time to return to the basics of regulating utility monopolies for the public good rather than promoting strategies that place utility investor interests ahead of customer interests."

In conclusion, the report recommends ending state policies that accelerate profit recovery and increasing transparency of utility rate increases on customers.

See the full report online.