The General Assembly Wants To Encourage Energy Competition Again. But Will It Work?

By Christine Condon, Maryland Matters

April 13, 2026

In the waning days of the 2026 legislative session, the General Assembly appears poised to slightly alter the rules for retail energy suppliers. But industry leaders say the rule changes are unlikely to bring suppliers back into the Maryland market, after a mass exodus in recent years.

The changes are just a small — and rarely discussed — part of the legislature’s sweeping energy package, called the Utility RELIEF Act.

The bill, which is expected to pass before the legislature adjourns at midnight Monday, would let energy suppliers that wish to compete with the local utilities offer longer contracts, for a maximum of three years. It would alter the current caps on what they can charge customers.

The energy companies could only charge customers, at a maximum, 110% of the rates charged by the utilities, if customers sign a three-year deal. The bill sets a lower cap for shorter contracts. One-year contracts, for instance, cannot go any higher than “standard offer service,” which is what the local utilities charge.

Frank Caliva, national spokesman for the Retail Energy Supply Association, which represents 19 energy suppliers around the country, said that the policy change allowing longer contracts is a baby step in the right direction. But the caps remain an issue, he said.

“Without removing the caps, it’s very unlikely we’re going to see a robust, competitive market,” Caliva said.

Sen. Malcolm Augustine (D-Prince George’s) is an architect of 2024’s retail energy market reform, called Senate Bill 1, which he says is protecting ratepayers from being charged more than the utilities charge. (Photo by Danielle J. Brown/Maryland Matters)

After the legislature passed Senate Bill 1 in 2024, competitive suppliers largely abandoned Maryland, Caliva said. Constellation Energy, one of those suppliers, has so far unenrolled 80% of its Maryland customers, said Dean Bush, executive director of consumer marketing at Constellation.

Notably, the General Assembly did not ban third-party energy companies in 2024. The companies chose to leave the marketplace after the legislature set new rules on the price utilities could charge, and limited contracts to 12 months.

Under current law, the suppliers cannot charge more than the 12-month trailing average of standard offer service. Partially because rates have climbed rapidly, suppliers argue that the average is too low for them to make a profit. Third-party suppliers’ rates are not regulated by the Maryland Public Service Commission, which regulates utilities’ rates.

If you ask Sen. Malcolm Augustine (D-Prince George’s), the architect of 2024’s reform effort, SB 1 is working as intended, by saving customers from paying more than standard offer service, or SOS. He argues that opening the door wider for suppliers would just give them more freedom to overcharge ratepayers.

“It’s literally working,” he said. “We’re saving Marylanders hundreds of millions of dollars that they were previously paying above SOS.”

A 2018 report commissioned by the Maryland Office of People’s Counsel found that one Marylander in five was using a third-party supplier for electric or gas service. And, taken together, Marylanders lost money, the report found. Annually, Maryland households were losing about $34.1 million by participating in the electric supply market and $20.7 million in the gas supply market.

Maryland House and Senate leaders reach a deal on comprehensive energy bill

Unlike the House, the Senate did not pass any changes to the retail supply market this year. But after an agreement between the two chambers, the modifications are included in the RELIEF Act.

Augustine argues that the pushback from energy companies about the new rules is an indication that the companies do not want to offer their services unless they can charge customers a higher rate than what they would ordinarily charge.

“It’s a complete admission of the fact that you have to charge more than what people are currently paying in order for them to make money,” Augustine said.

But Constellation Energy officials say the cap is unfair.

“We don’t believe that we should be subject to a price cap generally,” Bush said. “No other product or commodity is.”

Customers deserve the freedom to choose a higher rate than standard offer service, and lock that rate in for years to come, said Maurice Simpson, senior state government affairs manager at Constellation. If rates increase enough during their contract, the customer would save money.

“That’s the value that people are losing out on,” Simpson said. “You take all the information into consideration and make a decision to say: You know what? I think I’m going to get a better deal if I lock in my rate right now.”

Dave Rabinowitz, a Baltimore County retiree, said he was frustrated to learn last year that his energy supplier, Constellation, would be dropping him. And he was even more frustrated when he found out that it was because of the Maryland General Assembly.

“Give me a reason why you took away the right to have other companies compare and compete,” said Rabinowitz, 76. “You didn’t save me anything.”

Rabinowitz, a longtime third-party energy customer, said he always signs up for energy contracts that he can cancel with no penalty, and checks his utility bills every month to make sure he isn’t paying any significant amount higher than what Baltimore Gas & Electric would have charged.

“I’ve never been overcharged — ever,” he said.

Laurel Peltier, an AARP consumer advocate who helps ratepayers struggling with their utility bills, said Rabinowitz is in the minority. Customers who don’t have the time to carefully scrutinize their bills and make sure they aren’t being charged more than they would otherwise pay.

“For every one person that saved, there were four to five people that paid significantly more,” Peltier said. “That is not good public policy.”

Maryland Matters is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501(c)(3) public charity. Maryland Matters maintains editorial independence. Contact Editor Steve Crane for questions: scrane@marylandmatters.org. Follow Maryland Matters on Facebook and Twitter.