More than 1 in 3 Maryland households are unable to keep pace with the cost of living and are struggling to pay their bills. Unfortunately, Baltimore Gas and Electric (BGE), the state’s largest gas and electric utility, is piling on to the hardship.
By finding new ways to boost spending on energy infrastructure, utilities are able to pass along the costs to consumers and generate additional profits for their corporate shareholders. Over the last decade, BGE has egregiously executed this playbook at Marylanders’ expense.
Since 2014, the state’s utilities have been allowed to dramatically increase their spending on new gas pipelines and equipment, and BGE has since dumped $1.4 billion into additional pipe replacement spending. As a result, BGE’s gas delivery rates have increased by 50 percent in just the last five years and risen by almost three times the rate of inflation since 2010.
At the same time, increased utility spending has also driven up customer electricity bills. BGE’s electric delivery charges have jumped 30% just since 2020 – about twice the rate of inflation.
Earning a healthy rate of return on all this extra spending has been a windfall for the utility’s corporate executives and shareholders, and BGE’s profits have tripled since 2010.
Earning a healthy rate of return on all this extra spending has been a windfall for the utility’s corporate executives and shareholders, and BGE’s profits have tripled since 2010.
But are Marylanders seeing improved service as a result of all the additional investments? The signs are worrying.
Despite dumping billions into ripping out and replacing the gas pipelines over the past decade, there’s little evidence that safety or quality has actually increased. In fact, hazardous leaks from BGE’s pipelines have increased over the last ten years.
Even worse, more news about the company’s wasteful spending emerged when fourteen former BGE employees challenged a recent rate hike request, alleging a history of gross mismanagement and fraud— including revelations that a BGE employee was logging false pipeline inspection reports while on a boat in the Chesapeake. The state’s utility commission has now opened a formal investigation.
Why do monopolies like BGE keep getting away with runaway rate hikes? Maybe it has to do with the nearly two dozen lobbyists it employs to influence state politicians and the millions of dollars it spends on advertising.
Local utilities like BGE have even used their influence to control the rules of the regional Mid-Atlantic electric grid to help fend off competition. This has effectively slowed the construction of new solar and wind projects that could help bring down electricity costs, which are set to increase for Marylanders by another $18 per month starting in June 2025.
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The actions driving increasingly expensive energy bills have severe real-life consequences: just in 2023, BGE shut the power off for a record-breaking 80,000 customers who fell behind and could no longer pay their bills. State lawmakers and regulators should demand better and fairer performance from our public utilities.
To learn more about why BGE bills have risen so high, see analysis from Maryland’s official consumer advocate, the Office of the People’s Counsel. And to take action, visit Upgrade Maryland.
