Maryland officials have asked federal regulators to end a transmission surcharge charged to utility customers for participation in the PJM regional power grid, a change state leaders say could deliver about $20 million a year in savings to ratepayers. The request, filed July 2 with the Federal Energy Regulatory Commission, could trigger litigation if utilities resist.
What changes for Maryland households
The filing asks FERC to prohibit several utilities from collecting an extra fee that had been billed to customers as an incentive for joining the regional grid. The request rests on a new state law, effective July 1, that requires utilities to be part of a regional transmission grid — a condition that state officials say removes the rationale for an additional surcharge.
"There’s no reason to pay an incentive bonus for something that’s a requirement in the law … otherwise you’re just taking money out of ratepayers’ pockets for no good reason," said Kumar Barve, chairman of the Maryland Public Service Commission.
Potential for a lengthy court fight
Maryland regulators asked that customers receive refunds for any surcharges collected after July 2. But officials acknowledge the change may not be straightforward: similar efforts in other states have prompted utilities to appeal FERC rulings to federal appeals courts, delaying relief.
In both Ohio and California, utilities challenged FERC decisions and took the disputes to the federal courts, where judges ultimately found utilities could not keep the surcharge when participation was mandatory. Maryland officials say those precedents support the state’s position but warned utilities here could still litigate.
"I hoped the utilities would be moved by the ‘public perception of continu'"
The Office of People’s Counsel, which represents consumer interests, urged utilities to work with regulators and voluntarily remove the surcharge. People’s Counsel David Lapp wrote to the companies in June asking them to cooperate and to file with FERC to eliminate the charge.
Who is involved
- Maryland Public Service Commission — led the FERC complaint; Chairman Kumar Barve spoke publicly about the change.
- Office of People’s Counsel — requested utilities voluntarily end the surcharge and sought consumer refunds.
- Federal Energy Regulatory Commission (FERC) — the federal agency asked to rule that utilities stop imposing the surcharge and to order refunds where applicable.
Background and local impact
The new state law, effective July 1, makes participation in a regional transmission grid a legal requirement rather than a voluntary option. Utilities had previously included a surcharge in transmission rates to reward or compensate for joining the grid. State officials argue the legal change removes the basis for that fee and that continuing to collect it unfairly burdens consumers.
If FERC grants the petition and utilities comply, Marylanders could see a modest reduction in electric bills and, potentially, refunds for charges applied after early July. If utilities contest the order, ratepayers could wait months or years for the dispute to be resolved in federal court.
| Item | Detail |
|---|---|
| Estimated annual savings | $20 million |
| Key agencies | Maryland PSC; Office of People’s Counsel; FERC |
| Effective date of state law | July 1 |
For residents, the immediate takeaway is watch for announcements from their utility about rate changes and for any FERC orders that could direct refunds or the removal of the surcharge. If the utilities choose to fight the change, the process could resemble disputes in other states that pushed the question into federal appeals courts and delayed consumer relief.
Maryland’s effort joins a broader national conversation about how costs of regional grid participation are allocated and how state law interacts with federal rate-setting authority. Consumers and advocacy groups will be closely following FERC’s response and any subsequent filings by utilities.
