SB 951 — Investor‑Owned Electric Companies: Authorization to Own Generating & Transmission Facilities
Status (key dates)
- Introduced: January 28, 2025
- Next scheduled hearing: March 6, 2025 (1:00 p.m.)
- Bill text amends Article — Public Utilities §7‑510(c)(6) (Maryland)
- Proposed effective date (if enacted): October 1, 2025
Purpose / intent
- To explicitly authorize investor‑owned electric companies (IOUs) in Maryland to construct, acquire, lease and operate their own electric generating facilities and the transmission facilities necessary to interconnect those generators with the electric system.
- To adjust the Public Service Commission’s (PSC) authority relating to when an IOU may be required to build such facilities to meet long‑term anticipated demand.
Key provisions
- Authorization: Adds language that, “subject to the requirements of Subtitle 2 of [Title 7], an investor‑owned electric company may construct, acquire, or lease, and operate its own generating facilities” and “construct, acquire, or lease, and operate its own transmission facilities necessary to interconnect the generating facilities with the electric system.”
- PSC authority changed: Where current law allows the PSC to “require or allow” an IOU to construct/acquire/lease and operate generating and interconnection transmission facilities to meet long‑term anticipated demand for standard offer service, the bill modifies that authority so the PSC may only “require” (not “allow”) such action where necessary. The bill retains a cost‑recovery limitation: actions by the PSC to require construction are subject to appropriate cost recovery.
- Regulatory process preserved: Facilities remain subject to Subtitle 2 regulatory requirements (e.g., Certificates of Public Convenience and Necessity (CPCNs) and other siting/licensing procedures). (The fiscal note notes small facilities — generally up to 2 MW — often do not require CPCNs.)
Who would be affected
- Investor‑owned electric companies (utilities): explicitly able to own and operate generation and related transmission. That could enable IOUs to re‑enter ownership of generation asset types divested under earlier restructuring.
- Public Service Commission: retains authority to compel IOUs to build when necessary; will continue to oversee CPCNs, cost recovery, and regulation.
- Ratepayers and retail electricity market: potential implications for competition, wholesale and retail market dynamics, and rate recovery (if PSC authorizes cost recovery for required projects).
- State and local governments: potential fiscal effects (taxes, local economic activity) if new generating facilities are built; magnitude depends on whether the bill leads to construction that otherwise would not have occurred.
- Office of People’s Counsel and other oversight entities: involved in proceedings; the fiscal note anticipates existing resources likely sufficient but notes possible need for additional staff/consultants.
Fiscal and policy considerations
- Fiscal Note (Maryland DLS): PSC and Office of People’s Counsel can generally absorb responsibilities within existing resources; if not, agency special fund expenditures could rise (funded by assessments on public service companies). Broader state/local fiscal impacts are uncertain and could be significant if the bill causes new, larger generating facilities to be built in Maryland (increasing local economic activity and tax revenues).
- Policy impacts: The bill potentially moves Maryland away from strict separation of generation from IOUs established under earlier restructuring by permitting IOUs to own generation again; this could affect competitive market participants, procurement for standard offer service, and planning for resource adequacy.
Procedural note
- The bill amends the statutory text in Public Utilities §7‑510(c)(6) and keeps the CPCN/siting oversight framework in Subtitle 2. Any utility construction, acquisition, or lease for larger generators will continue to involve PSC review and cost‑recovery proceedings.
