BALTIMORE — The cost of energy is on the rise according to PJM's (Pennsylvania-New Jersey-Maryland Interconnection) capacity auction. The group, which is responsible for keeping electricity reliable for 13 states including Maryland, announced that new rates could lead to higher bills for many customers.
In a press release, PJM said the new rates could lead "to a year-over-year increase of 1.5–5% in some customers' bills."
Watch as officials break down the increase
However, due to issues with how the last auction was conducted, BGE customers may actually be spared from this increase.
WATCH: Energy costs expected to rise for many, but BGE customers may see slight decrease
"BGE customers are paying incrementally more, but actually a little bit less once you account for the inclusion of the brand insurers and Wagner power plants and accrediting mechanism that they are getting for paying those costs. So ultimately, at the end of the day, BGE customers may see a small decrease to their bills," David Lapp from Maryland's Office of the People's Counsel said.
Maryland's Office of the People's Counsel has advocated for PJM to include the energy generated from Maryland's Brandon Shores and Wagner plants, which weren't included in last year's calculations.
Another issue affecting energy costs is the queue for new energy generation projects waiting to connect to the grid.
"The queue is the line that new generation waits in in order to get connected to the transmission system and to supply power to the region. And there's been a massive backlog, there's something around 7,000 megawatts of generation in Maryland, mostly solar and renewable generation and storage, and it's waiting to get interconnected to the queue," Lapp said.
Just because the energy auction didn't significantly raise BGE prices for next year doesn't mean the cost of energy isn't going up. Energy prices are scheduled to rise this fall before decreasing again in the winter months, a system meant to smooth out the cost of energy increases on customers' bills.
There's also the chance that demand continues to increase, particularly from data centers.
"PJM has attributed a lot of the projected energy demands from new data centers as a key factor that are causing the supply and demand imbalance or potential supply and demand imbalances. And it does beg the question of if that's the case, why are, you know, small businesses in Maryland and ratepayers in Maryland, the ones footing the bill for increased rates from largely out of state data centers?" Emily Scarr from Maryland PIRG said.
PJM hopes to connect all the projects waiting to be integrated into the energy grid in the next 18 months. Still, rising demand for energy means that new supply may not bring prices down.
We reached out to BGE for a comment and here's what they said:
“Our customers are facing higher costs of many essentials, from housing to transportation to food, energy, child care, and more. BGE is committed to helping customers manage their energy costs and access support if they need it.”
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