• What is Electric Utility Deregulation?
• Standard Offer Service
• How to Choose a Supplier
• The Environmental Information Label
• What If I Do Nothing?
• Clean, Green & Renewable Energy
• Annoying Phone Calls
• Consumer Protection  
• Need Help With Your Electric Bills?
• How is Maryland Different from California?

In 1999, a law was passed in Maryland called the Customer Choice Act. The Act gave Maryland customers the right to choose their electric power supplier, beginning in July of 2000. The Act also unbundled, or separated, the different pieces of the electricity product from each other. For example, when you buy power, you are buying generation, transmission and distribution. Generation creates the power, transmission brings it to your area, and distribution brings it to your home or business. The only piece of the electricity product that you are now able to choose is generation.

Generation is the creation of electricity through the burning of fuels or the use other energy sources. Generation usually happens at a power plant. Most power plants burn fossil fuels such as coal, oil or natural gas. Some power plants use nuclear energy. And, some electricity is generated from renewable resources such as solar power, wind, or biomass.  A company that provides generation of electricity is called an electricity supplier.

Transmission is the process of transmitting, or moving, the electricity from the power plant to the local distribution facility. Sometimes electricity is transmitted over long distances. For instance, the high tension power lines we see throughout the area are used for the transmission of electricity.

Distribution is the movement of electricity from a local center, or substation, to your home or business. Distribution lines are usually the smaller lines that are seen strung from telephone poles along streets, or buried underground.  A company that provides distribution of electricity is called an electric company.

The piece of the electricity product that customers can now choose is generation. The generation part of the industry is what has been deregulated. Transmission and distribution will continue to take place in much the same way, and according to many of the same rules, that they did before deregulation.

Before the Act was passed all customers bought electricity from the public utility that provided power to their area. Now it is possible to buy your electricity from any supplier currently offering a product in your area. The electricity will still be delivered to your home by the same company that delivers it now, and will be delivered through the same wires and poles. 

If you switch electricity suppliers, you will not need to have new wires run to your home.

For example, if you get your power from Pepco, then Pepco will still provide your home with distribution service, even if you are buying your electricity generation from a different supplier. Pepco will still be your electric company. If you have a problem with your service, or loose power, you still call the same company that you always called. The same is true if you currently get your electricity from BGE or Allegheny Power.

Deregulation is also referred to as "restructuring." In the past, it was sometimes called "retail wheeling."

The Maryland Public Service Commission provides information on electric utility deregulation for consumers and businesses on their website on Customer Choice.

Most residential customers are now receiving what is called "Standard Offer Service."  This is the service you receive if you have not switched to a new electricity supplier.  At present, there are price caps on Standard Offer Service.  These price caps were put in place by the Maryland Public Service Commission to ensure that residential electricity consumers would be protected from price volatility during the transition to a competitive marketplace.  However, the price caps will expire.  The current schedule for the expiration of price caps for residential customers is shown below:

Now that you have the RIGHT to choose your electricity provider, it’s up to you to decide when and if you want to exercise that right.

If you do want to make a choice, some of the things you will probably want to consider are price, environmental effects, and other services that the supplier might offer. The reliability of delivery of service to your home is still dependent upon your Electric Company, and should not be affected by your choice of power supplier.

If you want to make a choice based on price, you should look for the official "price to compare." The "price to compare" will be presented as a price per kWh (kilowatt hour), and should serve as a benchmark for comparing other company’s offers to your Standard Offer Service and for comparing different offers to each other.  To see the current list of offers, and compare them to Standard Offer Service, go to the web page of the Attorney General's Office.

This list will continue to grow as more new suppliers enter the market.

It is important to remember that your choice will affect only the generation portion of your bill. The costs of transmission and distribution will not be affected by your choice of supplier.

If you are concerned about the environmental effects of the electricity you use, you might want to base your choice on environmental factors. The two primary environmental issues regarding electric power generation are the:

1) generation mix - the different types of fuels and energy resources that are used to make the electricity

2) emissions profile - the quantities and types of environmental emissions that are produced when making the electricity.

Electricity suppliers are required to disclose to this information to their customers. Each supplier provides an Environmental Information Label showing the percent of each different type of energy source that is used to generate their electricity. The label also shows some types of environmental emissions, and compares these to a benchmark.

When reviewing the environmental disclosure label it is important to understand how the use of different fuels and energy sources impact the environment. For more information on this, see the  Renewable Energy Policy Project.

For more information on choosing an electricity supplier, order your free copy of the Consumer Guide to Electric Choice from the Maryland Public Service Commission, by clicking on the Consumer Guide icon at left.

All suppliers of electricity in the Maryland are required to disclose certain environmental information to their customers in the form of an Environmental Information Label. This label is intended to tell you where your electric power comes from, in terms of the fuel sources used to produce it. It will also tell you what some of the environmental emissions are. In essence, the Environmental Information Label is much like the nutritional label on the foods you buy. It should tell you what the ingredients are, and disclose some of the health effects of the product.

All Maryland residents receive an Environmental Information label from their electric company or supplier twice each year. The label is mailed to you with your electric bill in April and October.

As new suppliers enter the marketplace, they will provide Environmental Information Labels as part of their marketing materials. These Environmental Information Labels can to be useful to you when you are deciding whether to choose a new supplier.

The specific requirements for the form and content of the Environmental Information Label are set by the Maryland Public Service Commission. The Public Service Commission also sets the schedule for when this information will be updated and when it will be sent to customers.

• What does an Environmental Information Label look like?
• What is meant by "regional average?"
• When will the information be updated?

Nothing will happen to you if you do nothing. If you do not choose an electricity supplier, you will continue to get power from the same company you get it from now. Your power will not be cut off because you didn’t make a choice. Your service will continue, much in the way it always has, and it will now be called "Standard Offer Service."

Standard Offer Service is the service that utilities will continue to provide to their existing customers for at least three years. You do not need to take any action, or fill out any forms to continue to receive Standard Offer Service.

Right now there are price caps on Standard Offer Service. these price caps were put in place to protect residential customers from fluctuations in price during the first few years of electricity deregulation. These price caps will expire on the following dates:

The price you pay for electricity could change after the price cap for Standard Offer Service in your area expires.

One of the benefits of deregulation is that it gives customers the ability to choose power that is generated from "clean," "green," or "renewable" sources. These are alternatives to fossil fuels, and can be much friendlier to the environment.

Clean energy is generated from sources that produce fewer environmental emissions. For instance, natural gas produces less air pollution than coal. Depending on which types of emissions you consider, some energy sources will appear cleaner than others. In terms of air pollution, nuclear energy is rather clean. However, the disposal of radioactive waste products and other factors impact the environment in a variety of ways.

Renewable energy is produced from sources that are not depleted, but can be renewed in a relatively short period of time. Examples of renewable energy are solar energy, wind, biomass, geothermal, and low-impact hydropower.

"Green" is a general term or a label that is often applied to energy sources that are less polluting and/or more renewable than fossil fuels. The "Green-e" label is given to electricity products that meet certain requirements for environmental performance.

Electricity suppliers are allowed to use telephone soliciting to market their products. However, there are rules that they must follow. They are not allowed to call you before 8:00 in the morning or after 9:00 at night. All telephone solicitors are required to keep a do-not-call list of people who have asked that they not be called again by that solicitor.

If you do wish to choose an electricity supplier over the phone, the supplier has to provide you with information on all contract terms and conditions. The supplier will have to mail (or E-mail) a written contract to you within two business days. After you receive the contract, you will have 10 days in which you may choose to rescind the offer without penalty.

Consumer Protection 

Electric suppliers must be licensed by the Maryland Public Service Commission in order to sell electricity to customers in Maryland.

Customers can enter into contracts with suppliers in three different ways:

• in writing
• on the telephone
• over the Internet

All customers who enter a contract with a supplier must be provided with:

• notice of enrollment
• a description of the agreed upon billing option
• due date and mailing address for payments
• information about customer service and dispute processes
• notice that the customer has 10 days from receipt of this information in which to rescind the agreement
• contract terms and conditions
• information about consumer rights
• an Environmental Information Label

Consumers always have 10 days in which to rescind any offer made by an electric supplier. If you sign a contract or enter into a contract over the telephone or Internet, you can change your mind by notifying the company that you wish to rescind within 10 days of receiving the contract.

If a consumer terminates a contract with an electric supplier, the consumer will be returned to Standard Offer Service. It might then be necessary to stay on Standard Offer Service for a set period of time before you are permitted to choose another supplier.