Beginning on June 1, Maryland residents of Baltimore Gas and Electric (BGE) will experience yet another large hike in the cost of their electricity.
Customers of BGE, who have been struggling with high energy expenses all year, are furious over the rise.
The Talen Energy reliability-must-run (RMR) cost and an unanticipated increase in capacity auction pricing are the causes of the hike, according to BGE.
In a capacity market auction, power firms pledge to make their electricity generation available in the future through a competitive bidding process.
“There’s an acute misalignment between supply and demand for electricity in Maryland,” BGE spokesperson Nick Alexopulos stated. “In short, we don’t have enough power plants to meet the energy demand.”
Additionally, according to Alexopulos, some plants are retiring.
“PJM Interconnection, the regional grid operator, has determined that those power plants have to run past their retirement date to maintain reliability of the entire electric grid in the region,” Alexopulos stated.
PJM Interconnection was chastised by lawmakers last week for allegedly causing an undercount of energy supplies at the most recent auction, which increased the overall cost of electricity in the PJM region from $2.2 billion to $14.7 billion.
BGE stated on Tuesday that the increase was caused by a rise in the cost of “electricity itself,” not by the firm increasing its distribution rate.
According to Alexopulos, the highest bill for customers who pay for gas and electricity through BGE may increase by an estimated $40 based on previous averages.
“That said, if July, which is typically the hottest month where customers use the most energy, is much hotter than expected, those bills are going to be higher because you’re going to be using more energy,” Alexopulos stated.
What is the RMR fee for Talen Energy?
The fixed payments given to Talen Energy for maintaining the operation of its Brandon Shores and H.A. Wagner power plants in Maryland over their scheduled retirement dates are known as the Talen Energy RMR charge.
For the Brandon Shores facility, the regional grid operator, PJM Interconnection, pays a cost of $312 per megawatt every day, or about $145 million a year, plus a $5 million performance incentive.
In addition to a $2.5 million performance incentive, PJM pays a price of $137 per megawatt per day for the H.A. Wagner plant, or roughly $35 million annually.
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A settlement deal reached in January 2025 lays out the specifics.
Maryland faces persistent rises in energy rates
On January 1, BGE increased rates, resulting in a 9% increase in the average residential gas bill and a 7% increase in the average residential electric bill. Winter costs increased by more than $200 for certain clients, who experienced even greater increases.
The company gave a number of explanations for the increases, including a 30% increase in natural gas prices in the last 12 months, greater distribution expenses governed by the Maryland Public Service Commission (PSC), and higher state-mandated expenditures on energy saving initiatives.
BGE also mentioned significant expenditures for modernizing the gas infrastructure. Zeke Cohen, the president of the Baltimore City Council, has questioned the company’s long-term goals.
Cohen demanded earlier this month that BGE’s planned multi-year rate hikes for 2026 be made transparent.
BGE was able to boost prices for both gas and electric services by around $408 million over three years after the PSC authorized the company’s multi-year delivery rate hikes in 2023.
