Maryland Electricity Rates: How to Save

Maryland electricity rates are among the highest on the East Coast, and they're climbing fast. The average residential customer pays between 19 and 21 cents per kilowatt-hour in 2026 — roughly 15% above the national average of 17 cents per kWh. That translates to monthly bills of $165 to $181, depending on usage and which part of the state you call home. Since 2020, rates have jumped nearly 50%, driven largely by a massive spike in regional capacity market costs and the retirement of aging coal plants.

The good news is that Maryland is a deregulated state, which means you have options. You can shop for a competitive electricity supplier, subscribe to community solar, tap into generous state rebates through EmPOWER Maryland, or go solar with some of the strongest incentives in the mid-Atlantic. But there's a critical catch that every Maryland consumer needs to understand before making any moves: over the past 25 years, residential customers who switched to competitive suppliers have collectively paid $1.2 billion more than they would have on the default Standard Offer Service rate. Competition does not automatically mean savings.

This guide breaks down exactly how Maryland's electricity market works, what each utility charges, where the real savings opportunities are, and how to avoid the most common mistakes.

How Maryland's Electricity Market Works

Maryland deregulated its electricity market in 1999 when the General Assembly passed the Electric Customer Choice and Competition Act. The law separated electricity generation from the transmission and distribution business, promising lower rates through competition. Residential customers gained the ability to choose their own electricity supplier starting in July 2002.

Here's how the system works today. Your local utility — BGE, Pepco, Delmarva Power, or Potomac Edison — still owns the poles, wires, and meters. They deliver electricity to your home regardless of who supplies it. You cannot choose your delivery company; that's determined by where you live. What you can choose is the supply side: the company that generates or procures the electricity itself.

Your bill has two main components:

1. Supply charges — the cost of the electricity itself (this is the part where you have a choice)
2. Delivery charges — what the utility charges to transport electricity to your home (regulated, no choice)

If you do not actively choose a supplier, you're automatically placed on Standard Offer Service, or SOS. This is the default supply rate that your utility procures through a competitive bidding process overseen by the Maryland Public Service Commission (PSC). Residential SOS rates are set through twice-yearly auctions where wholesale suppliers bid to serve customers at the lowest price.

SOS is not necessarily the cheapest option available, but it is a regulated safety net. And as we'll see, it has historically beaten competitive suppliers for most residential customers.

For a full breakdown of how supply and delivery charges appear on your statement, our guide on how to read your electric bill and spot overcharges walks through every line item.

What Marylanders Actually Pay

Let's put real numbers on the table. As of early 2026, here's where Maryland stands:

Maryland's rates run roughly 13-15% above the national average on a per-kWh basis, and about 17% higher when it comes to total monthly bills. The state has seen energy prices climb 10.5% since January 2025 alone.

Historical context tells a striking story:

• 1990: 7.22 cents/kWh
• 2020: 13.00 cents/kWh
• 2026: 19-21 cents/kWh

Rates have nearly tripled since 1990 and increased roughly 50% just since 2020. The single biggest recent cost driver is the PJM capacity auction — the mechanism that ensures enough power plants exist to meet future demand across the mid-Atlantic region.

The PJM Capacity Spike Explained

PJM Interconnection operates the regional power grid serving Maryland and 12 other states. Every year, PJM holds a capacity auction where power plants bid to be available when needed. The results directly affect your bill.

For the 2025/2026 delivery year, the system-wide capacity price surged from $28.92 per megawatt-day to $269.92 per megawatt-day — a ninefold increase. The 2026/2027 auction climbed another 22% to $329.17 per megawatt-day. A December 2025 auction cleared at $333 per megawatt-day.

What this means for your monthly bill, by utility:

Why the huge variation? BGE's zone faces 73% higher capacity fees than the rest of PJM because the Brandon Shores and Wagner coal plants — located near Baltimore — retired without participating in the auction, leaving a local capacity shortfall.

The underlying driver is demand growth, specifically from data centers. PJM's peak load forecast rose approximately 5,250 megawatts for 2027/2028, and roughly 5,100 megawatts of that increase comes from data centers and AI computing facilities. Maryland consumers are effectively subsidizing the power infrastructure that the tech industry needs.

Maryland's Four Major Utilities Compared

All four of Maryland's major utilities are regulated by the PSC and deliver electricity on the same basic model. But their rates, territories, and capacity market exposure differ significantly.

Important: These SOS rates are only the supply portion of your bill. Once you add delivery charges, capacity costs, transmission fees, taxes, and surcharges, your total rate lands in the 19-21 cents per kWh range regardless of utility.

BGE and Pepco are both Exelon subsidiaries, as is Delmarva Power. Potomac Edison is a FirstEnergy subsidiary. Potomac Edison has the lowest SOS supply rate at 11.19 cents per kWh but faces the highest capacity cost increase at $18 per month — a frustrating combination for western Maryland customers.

Shopping for a Competitive Supplier: Proceed With Caution

Maryland's official comparison shopping tool is MDElectricChoice.com, operated by the PSC. The site lists supplier names, price per kWh, estimated monthly charges, plan types, contract terms, renewable energy percentages, cancellation fees, and incentives. You can filter by your utility territory to see only relevant offers.

As of 2026, roughly 11 active suppliers serve Maryland's residential market, with rates ranging from 6.70 cents to 21.67 cents per kWh. That wide range reflects different plan types, contract terms, and renewable energy percentages.

How to Switch Suppliers

1. Visit MDElectricChoice.com or contact suppliers directly
2. Compare the supplier's rate to your utility's Price to Compare (PTC) — this is the all-in SOS rate your utility publishes specifically for comparison shopping
3. Enroll with your chosen supplier — there's no service interruption and your utility still delivers the power
4. You can return to SOS at any time with no penalty
5. Switching is free; your utility handles the meter reading transition

The $1.2 Billion Warning

Here's the number that should shape every decision you make about supplier shopping: over 25 years of deregulation, Maryland's residential electricity customers have collectively paid $1.2 billion more through competitive suppliers than they would have paid on Standard Offer Service.

That's not a typo. Competition was supposed to lower prices, and it has worked well for large commercial and industrial customers who have sophisticated energy procurement teams. But for residential customers, the math has consistently gone the wrong way.

Why this happens:

• Variable-rate plans spike unexpectedly. A low introductory rate can jump significantly after the initial period.
• Fixed-rate plans often sit above SOS. Suppliers need profit margins, and SOS is already competitively bid at wholesale.
• Teaser rates expire. An attractive initial offer may be followed by months at higher rates that more than erase the early savings.

2024 Reform: Senate Bill 1

Recognizing the consumer harm, the 2024 Maryland General Assembly passed Senate Bill 1, which introduced major reforms to the retail energy market. The most significant change: retail energy contracts are now limited to 12-month terms. This prevents suppliers from locking customers into long-term deals that quietly become expensive. The law also improved price transparency requirements. Some suppliers have exited the residential market as a result of these reforms.

If You Do Shop, Follow These Rules

• Always compare to the full Price to Compare, not just the supply rate. The PTC includes all supply-related charges.
• Prefer fixed-rate plans for price certainty. Variable rates have historically hurt residential customers more often than they've helped.
• Read the contract terms carefully, especially regarding cancellation fees and what happens when the term ends.
• Set a calendar reminder before your contract expires so you're never rolled onto an expensive default rate.
• Check the renewable energy percentage if green energy matters to you — some plans include 100% renewable supply.

Community Solar: Real Savings Without the Roof

If you're looking for a way to lower your bill and support clean energy without installing anything on your property, community solar is one of the strongest options available in Maryland. Our detailed guide on community solar explains the concept in depth, but here's how it works specifically in Maryland.

You subscribe to a share of an off-site solar array. The electricity your share generates earns credits on your utility bill. You do not need to own a home, have a suitable roof, or install any equipment.

Maryland's Permanent Program

Maryland's community solar program became permanent on January 1, 2025, replacing an earlier pilot program. House Bill 908 (2023) established the permanent framework. Starting January 1, 2026, the program uses consolidated billing with a net crediting mechanism — meaning you get a single, streamlined utility bill rather than separate bills from the solar project and your utility.

What You Can Save

• Average savings: 5-10% off annual electricity costs
• At roughly 1.3 cents per kWh in savings on 9,600 kWh of annual usage, that works out to about $128 per year
• Low- to moderate-income customers may qualify for deeper discounts of around 2 cents per kWh in savings
• All projects must serve a minimum of 40% low- to middle-income subscribers, ensuring equitable access

Who Qualifies

• Any Maryland resident who is a customer of the utility in the same service territory as the solar project
• No homeownership required — renters qualify
• No credit score requirement for most programs
• You can cancel your subscription with notice (terms vary by project)

Community solar is particularly attractive if you rent, live in a condo, have a shaded roof, or simply do not want the commitment of a rooftop installation.

Rooftop Solar and Renewable Energy Incentives

For homeowners who can install solar panels, Maryland offers one of the more compelling incentive stacks in the region. Our solar panel buyer's guide covers the equipment side, but here are the financial incentives specific to Maryland.

Net Metering

Maryland provides 1:1 net metering, meaning you receive a dollar-for-dollar credit for every kilowatt-hour of excess electricity your solar panels send to the grid. Credits roll over month to month, and all four major utilities participate. Systems up to 2 megawatts qualify.

At the annual true-up (the end of your 12-month billing cycle), any remaining excess credits may be compensated at a lower avoided-cost rate. The key takeaway: net metering at full retail value makes Maryland solar significantly more attractive than states with less generous crediting policies.

Solar Renewable Energy Credits (SRECs)

For every megawatt-hour (1,000 kWh) of solar electricity your system generates, you earn one SREC. These credits can be sold on the open market or to utility companies that need them to meet Maryland's renewable portfolio requirements. Current SREC values range from approximately $5 to $20, depending on market conditions.

The Brighter Tomorrow Act (SB 783, signed May 2024) significantly boosted the value of new solar installations by creating "Certified SRECs" worth 150% of the standard SREC compliance value. To qualify, your system must be installed between July 1, 2024 and January 1, 2028. All SRECs now have a five-year lifespan, up from three years, giving you more time to sell them.

The Full Maryland Solar Incentive Stack

Combined, these incentives can offset 40-60% of a residential solar installation's total cost. If you're considering a full transition away from fossil fuels in your home, our whole-home electrification guide maps out how solar fits into the bigger picture.

Maryland's Clean Energy Mandates

Understanding where Maryland is headed on clean energy helps explain some of the costs on your bill today — and signals where future savings opportunities will come from.

Climate Solutions Now Act (2022)

Maryland passed one of the most ambitious climate laws in the country, requiring net-zero greenhouse gas emissions by 2045 and a 60% reduction from 2006 levels by 2031. This drives investment in renewable generation, grid upgrades, building electrification, and energy efficiency programs.

Renewable Portfolio Standard

Maryland requires 50% renewable energy by 2030, with specific carve-outs for solar (14.5%) and offshore wind (2.5%). Utilities must purchase SRECs to meet the solar target or pay Alternative Compliance Payments, which creates the market that makes rooftop solar SRECs valuable.

Offshore Wind

The POWER Act (2023) set a target of 8,500 megawatts of offshore wind by 2031. The PSC has approved over 2 gigawatts of capacity and awarded additional offshore renewable energy credits to US Wind for 1,710 megawatts. These projects face federal headwinds and legal challenges, but if they proceed, they'll bring significant new clean energy onto the grid. A new Strategic Energy Planning Office (SEPO), created via SB 909/HB 1037 in 2025, will coordinate the state's energy transition planning.

Low-Income Assistance Programs

If you're struggling to afford your electricity bills, Maryland has several programs that can help. These are not savings tips — they're direct financial assistance.

Office of Home Energy Programs (OHEP)

OHEP, administered by the Maryland Department of Human Services, is the central hub for energy assistance. Apply online at MarylandBenefits.gov or call 1-800-332-6347. Benefits are available once per fiscal year (July through June), and you must reapply each year.

Available Programs

Who Qualifies

Eligibility is income-based: household income at or below 200% of the Federal Poverty Level or 60% of the State Median Income, whichever is higher. You do not need a turn-off notice to apply. SNAP and Temporary Cash Assistance (TCA) recipients are categorically eligible — no separate application needed.

Winter Shutoff Protection

From November 1 through March 31, utilities face strict limits on disconnecting residential service. They cannot terminate service without certifying to the PSC that the disconnection does not threaten life or health. Utilities must make two attempts to contact customers behind on bills, and no disconnections are allowed when the forecast temperature at 6 AM is 32 degrees Fahrenheit or below. Customers or household members with serious medical conditions receive an additional 30-day freeze on termination.

These protections do not eliminate the financial obligation — bills continue to accrue — but they ensure you will not lose heat during the coldest months.

EmPOWER Maryland: The State's Best-Kept Savings Secret

EmPOWER Maryland is a statewide energy efficiency program that runs through the state's largest utilities. It offers rebates, incentives, free assessments, and weatherization assistance that can dramatically reduce your energy costs. If you do only one thing after reading this guide, look into EmPOWER.

Home Energy Assessments

• Quick Home Energy Check-up (QHEC): Completely free. A technician walks through your home and installs free LED bulbs, smart power strips, faucet aerators, and low-flow showerheads on the spot.
• Comprehensive Home Energy Audit: Just $100 (normally around $400). This detailed assessment is required to unlock up to $10,000-$15,000 in EmPOWER rebates for larger upgrades.

HVAC and Heat Pump Rebates

As of May 1, 2025, EmPOWER offers up to $15,000 for switching from fossil fuel heating to an electric heat pump or heat pump water heater. Geothermal heating and cooling systems qualify for a $3,000 rebate per residential system. These rebates stack with the 30% federal tax credit, making the transition to efficient electric heating remarkably affordable. For guidance on smart climate control, see our guide to the best smart thermostats for energy savings.

Weatherization Rebates

Insulation, air sealing, and duct sealing rebates can reduce heating and cooling costs by 20-30%. For qualifying low-income households, the Limited Income Energy Efficiency Program (LIEEP) often covers 100% of the cost for weatherization and efficiency upgrades — not just a rebate but the full expense.

A Note of Caution

As of March 2026, contractors and customers have raised concerns about potential cuts to EmPOWER rebate budgets. Program budgets are reviewed annually, and while rebates are running through 2026, the amounts may change. If you're planning a major upgrade, acting sooner rather than later is wise.

Savings Strategies That Work in Maryland

Here's a prioritized list of the most impactful ways to reduce your electricity costs, tailored specifically to Maryland's market structure.

1. Get Your Free QHEC Assessment

Start with the Quick Home Energy Check-up. It's free, takes about an hour, and you'll walk away with installed energy-saving devices plus a roadmap for larger improvements. This single step often saves $50-100 per year immediately.

2. Invest in Weatherization

Insulation and air sealing deliver some of the highest returns of any home improvement. EmPOWER rebates cover a substantial portion of the cost, and LIEEP may cover it entirely for qualifying households. Expect 20-30% reductions in heating and cooling costs.

3. Upgrade to a Heat Pump

Modern heat pumps are two to three times more efficient than traditional HVAC systems. With EmPOWER rebates up to $15,000 and the 30% federal tax credit, the upfront cost is significantly offset. This is especially impactful in Maryland, where heating and cooling make up a large share of electricity usage.

4. Subscribe to Community Solar

For 5-10% annual savings with zero upfront cost or installation, community solar is hard to beat. It's especially valuable for renters and condo owners who cannot install rooftop solar.

5. Install a Home Energy Monitor

You cannot manage what you do not measure. A home energy monitor shows you exactly where your electricity is going, often revealing surprises like an inefficient second refrigerator or phantom loads from electronics. Many Maryland households find $20-50 per month in waste they did not know existed.

6. Be Strategic About Supplier Shopping

If you decide to explore competitive suppliers, use MDElectricChoice.com and compare every offer against your utility's Price to Compare. Prefer fixed-rate plans, and remember the $1.2 billion cautionary tale. SOS is a perfectly reasonable choice for most households.

7. Shift Usage Away From Peak Hours

While Maryland does not have mandatory time-of-use rates for most residential customers, reducing consumption during peak afternoon hours still helps keep overall grid costs down. Running your dishwasher, laundry, and EV charger in the evening or early morning is a free habit change that adds up. Our guide on time-of-use electricity rates explains the concept in detail.

8. Go Solar If Your Roof Allows It

With 1:1 net metering, Certified SRECs at 150% value, 30% federal ITC, and no state sales tax, Maryland's solar incentive stack is strong. A typical residential system can pay for itself in 7-10 years while providing 25+ years of reduced or eliminated electricity bills. For a comprehensive overview, see our solar panel buyer's guide.

For more proven strategies, our guide on how to cut your electric bill in half covers techniques that apply across every state.

Frequently Asked Questions

What is the average electricity rate in Maryland?

As of early 2026, Maryland residential customers pay approximately 19 to 21 cents per kilowatt-hour, which is about 13-15% above the national average of roughly 17 cents per kWh. Your exact rate depends on which utility serves your area, whether you've chosen a competitive supplier, and your specific usage patterns.

Why are Maryland electricity rates going up so fast?

The biggest recent driver is the PJM capacity auction, where prices surged ninefold for the 2025/2026 delivery year — from $28.92 to $269.92 per megawatt-day. This added $4 to $18 per month per household depending on your utility. The primary causes are data center demand growth and coal plant retirements that have reduced available generation capacity in the Baltimore area.

Should I switch to a competitive electricity supplier?

Proceed with caution. Over 25 years of deregulation, residential customers have collectively paid $1.2 billion more through competitive suppliers than they would have on Standard Offer Service. If you do shop, use MDElectricChoice.com, compare every offer to your utility's Price to Compare, and strongly prefer fixed-rate plans. SOS remains a solid default for most households.

What is Standard Offer Service (SOS)?

SOS is the default electricity supply rate for customers who do not choose a competitive supplier. Your utility procures SOS electricity through a competitive bidding process regulated by the Maryland PSC, with residential auctions occurring twice per year. You can return to SOS from a competitive supplier at any time with no penalty.

Can my electricity be shut off in winter?

Maryland has strong winter protection rules from November 1 through March 31. Utilities must certify to the PSC that any disconnection does not threaten life or health, must make two attempts to contact customers behind on bills, and cannot disconnect when the forecast temperature at 6 AM is 32 degrees Fahrenheit or below. Customers with serious medical conditions receive additional protections.

What help is available if I cannot afford my electric bill?

Maryland offers multiple assistance programs through the Office of Home Energy Programs (OHEP). The Maryland Energy Assistance Program (MEAP) helps with heating bills, and the Electric Universal Service Program (EUSP) assists with current electric bills. Arrearage retirement programs can cover up to $2,000 in past-due electric bills. Apply at MarylandBenefits.gov or call 1-800-332-6347. SNAP and TCA recipients are automatically eligible.

How does community solar work in Maryland?

You subscribe to a share of an off-site solar array and receive credits on your utility bill for the electricity your share generates. No rooftop installation is needed. Maryland's permanent program launched January 2025, and consolidated billing started January 2026. Typical savings run 5-10% of your annual electricity costs, with deeper discounts available for low- to moderate-income subscribers.

What solar incentives does Maryland offer?

Maryland provides 1:1 net metering, SRECs worth $5-$20 per megawatt-hour, Certified SRECs at 150% of standard value under the Brighter Tomorrow Act, the 30% federal Investment Tax Credit, no state sales tax on solar equipment, and property tax exemptions in many counties. Combined, these incentives can offset 40-60% of a residential solar installation's cost.

Your Maryland Electricity Action Plan

Here's a concrete plan you can start today to take control of your electricity costs:

This Week:

1. Pull up your latest utility bill. Identify your current rate per kWh (supply + delivery combined), your monthly usage in kWh, and your total monthly cost. Understanding where you stand today is the essential first step.
2. Schedule a free Quick Home Energy Check-up through your utility's EmPOWER program. You'll get free energy-saving devices installed on the spot and a clear picture of your home's efficiency.
3. Check your eligibility for assistance programs. If your household income is below 200% of the Federal Poverty Level, visit MarylandBenefits.gov to apply for MEAP, EUSP, or other programs.

This Month:

4. Explore community solar options in your utility territory. Search for Maryland community solar providers serving your area. Look for programs with no upfront costs and guaranteed savings off your current rate.
5. If you're considering supplier shopping, visit MDElectricChoice.com and compare available rates to your utility's Price to Compare. Remember: SOS has beaten competitive suppliers for most residential customers over 25 years.
6. Book a comprehensive home energy audit ($100 through EmPOWER). This unlocks access to $10,000-$15,000 in rebates for major efficiency upgrades.

This Quarter:

7. Act on your audit results. Prioritize air sealing and insulation first — they deliver the fastest payback. Use EmPOWER rebates to offset costs.
8. If your HVAC system is aging, get heat pump quotes. With EmPOWER rebates up to $15,000 and the 30% federal tax credit, replacing a fossil fuel system with a heat pump has never been more affordable.
9. If you own your home with a suitable roof, get solar quotes. Maryland's combination of 1:1 net metering, Certified SRECs, and federal incentives makes residential solar a strong investment. Request at least three quotes to compare.

Ongoing:

10. Install a home energy monitor to track your electricity usage in real time and catch waste as it happens.
11. Monitor EmPOWER program updates. Rebate amounts may change as budgets are reviewed, so lock in current incentives before they shift.
12. Set a calendar reminder if you've signed up with a competitive supplier. Review your rate against the Price to Compare before any contract renewal.

Maryland's electricity market rewards consumers who understand the system and take action. Between EmPOWER rebates, community solar, strong solar incentives, and informed decisions about supplier shopping, the average Maryland household has multiple paths to meaningful savings — even as rates continue to rise.