House Speaker Joseline Peña-Melnyk’s plan to lower energy bills got mostly positive reviews Tuesday, but a proposal to tweak the state’s signature energy efficiency program, EmPOWER Maryland, raised concerns that it could upend the program instead.
The provision, which requires that all residential programs offered to customers under EmPOWER be cost-effective, is just one paragraph in the speaker’s 12-page Continuing the Next Generation Energy Act, House Bill 1532. But it was the focus of debate at Tuesday’s House Environment and Transportation Committee hearing.
Consumer advocates argued that, while individual initiatives may not always be cost-effective, the overall EmPOWER program is. The speaker’s bill could mean some programs might disappear, introducing considerable unpredictability into EmPOWER, they said.
“This might mean that someone could have a rebate for an HVAC system in Pepco, but that wouldn’t be offered for somebody in BGE,” said Josh Tulkin, director of the Maryland chapter of the Sierra Club.
But Del. Marc Korman (D-Montgomery), the committee chair and co-sponsor of HB 1532, defended the cost-effectiveness provision.
“I’m having a little trouble figuring out how I can tell my constituents we should keep paying for things that are not cost effective,” Korman said. “When we do an audit of a state agency, and we find that something is not working well, we don’t say: ‘Well, the overall agency is really good. We really like the work they’re doing, so we’re not going to worry about it.’ We say: ‘Oh, we need to fix that.’”
Brittany Baker, Maryland director of the Chesapeake Climate Action Network, said the Maryland Public Service Commission should tinker with programs struggling with cost effectiveness — rather than eliminating those programs altogether.
“If a specific territory has a specific sub-program that’s not cost effective, make them resubmit that program to the PSC, and find a way to make it cost-effective,” Baker said. “But we think that having a piecemeal approach, where you don’t know which services are available in your territory — and you don’t know whether those services will continue in that territory — makes the program less attractive for all ratepayers who are paying across the state.”
The EmPOWER program, created in 2008, is financed through a surcharge on ratepayers’ bills, that ranged from $6 to $12 per month in 2024, and run by investor-owned utilities in the state. Under it, ratepayers can get free or discounted energy audits, weatherization, efficient appliances and more. The program was started to reduce energy demand, and lawmakers in recent years have required that it focus on emissions reductions as well.
A 2025 report on the program found that, overall, for every dollar invested in EmPOWER’s energy efficiency and conservation programs, the program returned $2.21 in savings, as of 2023.
During her testimony, Peña-Melnyk said she plans to amend the bill so that the cost effectiveness test does not apply to EmPOWER programs operated through the Department of Housing and Community Development for low-income customers.
Her bill would also reduce the degree to which utilities are expected to lower their greenhouse gas emissions using EmPOWER, which legislative analysts said would lower costs for ratepayers. That provision has not attracted ire from climate groups like CCAN, with Baker saying Tuesday her group is “OK” with the change.
Other EmPOWER changes in the speaker’s bill got altogether positive reviews, including a plan to have one, centralized EmPOWER administrator, rather than letting each utility operate its own program.
Emily Scarr, senior adviser for Maryland PIRG, said that the change will eliminate “duplicative administrative costs,” without reducing the services available to customers. And Jennifer Bevan-Dangel, deputy director at Economic Action Maryland Fund, said a centralized structure could make it simpler for her clients, many of them low-income seniors, to access program benefits.
Republicans in Annapolis have offered their own EmPOWER proposals, suggesting that the customer surcharge should come to a halt because of high bills.
“A couple years ago, when gas prices were exorbitant, the state took emergency legislation. We introduced it to stop the state side of the gas tax. We’re asking for the exact same thing,” said Del. Matt Morgan (R- St. Mary’s) of the Maryland House Freedom Caucus, at a news conference last week about the group’s energy proposals.
Del. Matt Morgan (R-St. Mary’s) during a Maryland Freedom Caucus press conference on energy costs. (Photo Bryan P. Sears/Maryland Matters)
Peña-Melnyk’s Continuing the Next Generation Energy Act also makes a number of adjustments to last year’s marquee energy legislation, the Next Generation Energy Act.
It clarifies that utilities that file multiyear rate plans with the Public Service Commission — aiming to recover several years worth of projected costs through customer rates — can’t come back to recoup extra costs if it “would result in additional customer charges.” But the commission “may require” utilities to have a reconciliation procedure that refunds customers if they were overcharged.
Maryland People’s Counsel David Lapp said that he supports that provision, along with an amendment suggested by Peña-Melnyk that would also set limitations on “forecasted test years,” which he argues is essentially a different name utilities are using to accomplish the same thing— recovering their costs ahead of time, instead of after they are incurred. He argues that the procedure, a departure from traditional rate-making, is resulting in excess costs for ratepayers.
“The current bill would be an improvement, but what we see are ambiguities in the law, and utilities being able to come in with a different name for the same concept of these projected rates, that really are driving up rate increases and energy bills for customers,” Lapp said.
Peña-Melnyk’s bill would also increase the number of data centers with a separate tariff for “large load” customers, by lowering the threshold from data centers that use 100 megawatts of energy per month to centers that use 25 megawatts. The extra tariff is meant to hold the centers accountable for increased power infrastructure costs that they cause.
That provision is “critical,” Lapp said.
“Failing to lower that threshold will leave Maryland residential customers vulnerable to paying significant costs imposed by data centers,” he said.
During a news conference Tuesday, Peña-Melnyk highlighted the words of legislative analysts, who determined that her Next Generation legislation would save power customers money.
“The fiscal note is amazing,” she told reporters, before fishing the document from her purse and reading it aloud.
“Electric utility rates decrease – or future rate increases may be minimized – as a result of several provisions in the bill,” she read.
