By MDBayNews Staff
Maryland households — especially across Baltimore City, Baltimore County, and central Maryland — are opening utility bills this winter with a familiar sense of sticker shock. Baltimore Gas and Electric (BGE) customers are seeing noticeably higher electric and gas charges in early 2026, prompting frustration, confusion, and renewed political finger-pointing in Annapolis.
But despite some efforts to frame the increases as sudden or unavoidable, the reality is far less mysterious: these hikes were planned, approved, and layered in over time by regulators and policymakers. Winter weather may have amplified the pain, but the bill shock itself was years in the making.
Rate Hikes by Design, Not Accident
The largest driver behind the 2026 increases is BGE’s multiyear rate plan, approved in 2023 by the Maryland Public Service Commission. That plan authorized steady delivery-rate increases — the portion of your bill that pays for wires, pipes, maintenance, and grid upgrades — spread over several years.
As of January 1, 2026, the latest phase took effect:
- About $1.07 more per month for the average residential electric customer
- Roughly $2.06–$2.65 more per month for natural gas customers, depending on usage
Additional adjustments followed:
- February 2026: Reconciliation charges tied to prior utility overspending
- March 2026: PSC-mandated changes to smooth seasonal supply costs across the year
None of these increases were unexpected. They were approved in formal orders, debated in regulatory filings, and baked into long-term planning — even if most consumers only feel them once winter heating demand arrives.
Delivery Charges Outpacing Inflation
While individual increases may appear modest, the cumulative effect has been significant. According to the Maryland Office of People’s Counsel, BGE’s gas distribution rates have more than tripled since 2012, while electric delivery rates have nearly doubled.
That year matters: it’s when Exelon acquired BGE.
Since then, critics argue the regulatory system has increasingly rewarded capital spending with guaranteed returns, while households absorb higher fixed costs regardless of usage. BGE’s profits have climbed substantially over the same period — a fact that fuels skepticism among ratepayer advocates and center-right lawmakers alike.
PJM Capacity Market Chaos Hits Maryland Hard
Layered on top of state-approved hikes are rising wholesale electricity costs driven by the regional grid.
Maryland utilities buy power through PJM Interconnection, whose 2025/2026 capacity auction produced an eye-popping result: prices jumped more than 800% year over year.
A major factor was PJM’s exclusion of two Baltimore-area power plants — Brandon Shores and Wagner — from the auction due to technical rule classifications, even though the plants were required to remain online for reliability. By artificially shrinking supply, the auction cleared at record-high prices, with the BGE zone hitting the cap.
Those costs are now flowing directly into customer bills — a reminder that regional market failures don’t stay abstract for long.
EmPOWER Maryland: Savings Program or Mandatory Surcharge?
Another visible line item on many bills is tied to EmPOWER Maryland, the state’s energy-efficiency mandate. The program funds rebates, weatherization, audits, and efficiency upgrades — all paid for through mandatory customer surcharges.
Supporters argue EmPOWER reduces long-term demand and avoids massive grid expansion costs. Critics counter that:
- The surcharge is non-optional
- Utilities earn higher returns on EmPOWER spending than on basic delivery service
- Households struggling today see little immediate relief
As the state accelerates electrification goals and greenhouse-gas targets, EmPOWER costs are rising in the short term — even as promised savings remain long-term and unevenly distributed.
Winter Weather Was the Spark, Not the Fire
Cold snaps in January and February amplified usage, especially for gas-heated homes, making the underlying rate increases impossible to ignore. That timing matters: post-holiday budgets are already stretched, and higher fixed charges leave consumers with fewer ways to cut costs.
In other words, weather didn’t cause the spike — it merely exposed it.
The Policy Question Annapolis Can’t Avoid
Maryland leaders are now talking about “affordability,” but the uncomfortable truth is this: nearly every factor behind today’s bills traces back to deliberate policy choices — regulatory approvals, climate mandates, grid planning failures, and a system that socializes risk while guaranteeing utility returns.
For center-right critics, the lesson is clear:
- Ratepayers lack meaningful opt-outs
- Oversight hasn’t kept pace with spending
- Grid reform and data-center growth remain unresolved
- Households are paying now for promises of future benefits
Short-term relief options exist — including BGE assistance programs, the Fuel Fund of Maryland, and conservation steps — but they don’t change the structural trajectory.
Until lawmakers confront the cumulative cost of regulation itself, Maryland families should expect utility bills to remain a recurring shock — not a seasonal anomaly.
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