MARYLAND — A new report from Maryland’s utility consumer advocate is raising concerns over how much more Baltimore Gas & Electric (BGE) customers could soon be paying, as the company seeks approval for another $156 million rate increase.
The Maryland Office of People’s Counsel, the independent state agency that represents residential utility customers, says BGE’s latest proposal continues a years-long trend of rate increases that have significantly outpaced inflation.
“We see them coming in almost every single year for a rate increase,” Maryland People’s Counsel David Lapp said, “And certainly we think that its level of spending on capital improvements exceeds what is necessary to serve customers.”
According to a new consumer guide released by the Office of the People’s Counsel (OPC), the average BGE customer could pay about $100 more per year if the proposal is approved in full.
The report says BGE’s electric distribution rates alone would increase by about 17%. Those rates would also be 58% higher than they were in 2020 and 129% higher than in 2012, the year Exelon acquired BGE, according to the OPC.
“Many aspects of their rate increase are not related to investment for customers, but are really asking for higher recovery of costs,” Lapp said.
BGE, however, argues the proposal is necessary simply to maintain a safe and reliable.
“We stripped out all of the proactive work and filed a bare bones investment strategy,” said BGE spokesperson Nick Alexopulos, “We focused it on only maintaining the current level of reliability.”
But the OPC argues not all of the additional money BGE is seeking would go toward maintaining its system. The agency points to BGE’s request to increase its allowed return on equity from 9.5% to 10.4% — allowing the utility to earn a higher return for shareholders.
“What we see in competitive markets are profit levels significantly less than that, 5, 6, 7 percent,” Lapp said, “And so, you know, what we’re seeing is what we think is an exploitation of customers.”
BGE pushed back on that criticism, arguing that focusing on the company’s return on equity does not tell the full story of rising energy costs.
“Framing that as the entire affordability crisis is grossly misleading and irresponsible to our customers,” Alexopulos said.
According to BGE, lowering its proposed return would save the average customer only about $2 per month.
“Every dollar counts, but it’s not cutting your bill in half. It’s not cutting your bill by 25%,” Alexopulos said.
The debate comes as utility affordability remains a concern for Maryland households already dealing with years of rising energy costs.
Whether BGE customers will ultimately have to pay the full proposed increase is now up to the Maryland Public Service Commission, which can approve, reject or modify the company’s request.
A series of hearings will take place before the commission makes its final decision, which is expected in January 2027.
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