New law aims to combat excessive prices charged by energy suppliers

BALTIMORE – Utilities are one of the largest items in a family budget.

Some energy suppliers take advantage of this by selling people lower tariffs and then driving up prices.

This is a lure offer with a subsequent switch to a cheaper electricity bill.

Until the bait price is removed and the costs skyrocket.

“The customer may not realize they are being charged this very high rate, or it may take them a while to realize they are being charged this very high rate, and then it may be difficult to get off that rate,” said David Lapp of the Office of the People’s Counsel.

According to a 2022 study by the Energy Supplier Help Desk, Maryland residents who got their electricity from a third-party provider paid an average of $500 more per year than people who got their electricity from their local utility, representing hundreds of thousands of Maryland families.

“What is clear is that hundreds of thousands of Maryland residents are paying more than $150 million more over the course of a year than they normally would,” said Senator Malcolm Augustine, the lead sponsor of Senate Bill 1, which is intended to counteract this.

Sometimes it can happen that the third party company is fraudulent.

“For example, a retail supplier could pretend it’s their utility company going door-to-door,” Lapp said.

In the first steps: Senate bill.

From January 1, the company may not charge you more than the rate of a local utility company.

“From January 1, 2025, these bait offers will be illegal. Customers should therefore no longer be offered these tariffs. If this does happen, they can file a complaint and withdraw from the contract,” said Lapp.

External energy suppliers were founded to compete with local energy suppliers.

However, unlike local utilities, their tariffs are not regulated.

“We still haven’t changed that. There is a competitive market for retail energy that was established about 20 years ago. But we have said that you cannot be charged more than if you went directly to the energy supplier in the first place,” said Senator Augustine.

There is an exception in the law that allows higher costs for renewable energy.

“If our voters are willing to pay more for this green energy, we think that’s appropriate,” Augustine said.

Several energy providers opposed the bill, saying it could end their operations in Maryland and result in job losses.

None of them agreed to be interviewed for this article.