Maryland commission denies nearly half of funding for BGE's rate plan request
The Maryland Public Service Commission (PSC) on Monday denied nearly $75.1 million of Baltimore Gas and Electric's (BGE) $152.3 million request to support the final year of its rate increase plan.
The commission granted the company a total of $77.2 million, saying, "...granting a reconciliation of the magnitude BGE requested would risk increased utility unaffordability by many customers."
According to PSC officials, BGE requested the funds to recover spending that it under-collected on 2023 utility rates.
"While we appreciate the Commission's focus on keeping costs low for customers, we have a responsibility to keep the power system operating reliably and safely, which requires maintenance work on our systems," BGE spokesperson Nick Alexopulos said in a statement.
Impact on monthly bills
The commission's decision will impact utility bills for Marylanders.
According to the commission, the decision resulted in a $0.72 increase in monthly bills for average residential electric customers and a $1.95 increase for average residential gas customers starting in February 2026 and continuing through the end of 2027.
"While the estimated monthly bill impact resulting from this decision does not fully mitigate the utility affordability risks faced by residential customers, it does at least – to some degree - buffer the impact," said PSC Chair Frederick Hoover.
If they had approved BGE's full request, the commission said it would have resulted in rates that are "unaffordable to ratepayers."
Requests for funding
In May 2020, BGE became the first utility provider to apply for a rate increase using a multi-year plan under a pilot program that was approved by the commission. The commission only allows for two reconciliation requests, and Monday's decision was the second request for BGE.
In their decision, the commission noted that BGE overspent its budget in several programs and determined that some of the company's spending would provide benefits to customers.
The commission further noted that approving BGE's full request "...would wrongly reward the utility's performance rather than encourage a more disciplined approach to managing for results that benefit both the utility and its customers."
"BGE weighs every expense carefully, with customer costs in mind every step of the way," BGE spokesperson Alexopulos said. "The work we did strengthened reliability, improved safety, and responded to severe storms—necessary and critical work for customers and the reliability of our systems."
Utility rate concerns
Residents and business owners across Maryland have raised numerous concerns and have called for action to address rising utility costs over the past few years, especially due to BGE rate hikes.
Gas delivery rates in Maryland have increased by 246% since 2010, and electric delivery rates have increased by 92%, according to the Maryland Public Interest Research Group.
In February, Baltimore City Councilmembers passed a resolution calling on the PSC to stop BGE's 2026 rate hikes. The increases come after the commission approved the multi-year plan in 2023, making way for a $408 million utility rate increase over three years.
At the time, the company argued that the funding was needed to cover investments in electric and gas distribution systems.
On Monday, Baltimore City Council President Zeke Cohen acknowledged the commission's move softened "increases for utility bills in Baltimore," but further called on the PSC to do more to protect energy consumers.
"BGE is due to enact yet another distribution rate increase on gas and electricity next year," Cohen said in a statement. "The PSC must do its job and act in the public interest by freezing the rate increases, implementing the Next Generation Energy Act, and ending multi-year rate plans."
BGE provides utilities to nearly 1.3 million electric customers and nearly 700,000 natural gas customers in Baltimore City and 10 other Maryland counties.