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EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*hb0940*
HOUSE BILL 940
C5 6lr2072
CF SB 596
By: Delegate Charkoudian
Introduced and read first time: February 5, 2026
Assigned to: Environment and Transportation
A BILL ENTITLED
AN ACT concerning 1
Large Load Customers – Electric System Interconnection and Demand 2
Response Program 3
FOR the purpose of exempting certain large load customers from requirements to obtain a 4
certificate of public convenience and nece ssity; requiring the Public Service 5
Commission to establish a certain process for large load customers to interconnect to 6
the electric system ; establishing requirements for a large load customer to 7
interconnect to the electric system and contract for service; authorizing certain large 8
load customers to receive certain prioritization; requiring the Commission to 9
establish a Demand Response Program for large load customers; requiring the 10
Maryland Energy Administration to study and repor t to the General Assembly on 11
certain information regarding surplus interconnection potential ; and generally 12
relating to large load electricity customers. 13
BY adding to 14
Article – Public Utilities 15
Section 7–219.1 and 7–1008 16
Annotated Code of Maryland 17
(2025 Replacement Volume and 2025 Supplement) 18
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 19
That the Laws of Maryland read as follows: 20
Article – Public Utilities 21
7–219.1. 22
(A) (1) IN THIS SECTION THE FOLLOWING WORDS HAVE THE MEANINGS 23
INDICATED. 24
2 HOUSE BILL 940
(2) “LARGE LOAD CUSTOMER ” MEANS A COMMERCIAL OR 1
INDUSTRIAL CUSTOMER FOR RETAIL ELECTRIC SERVICE THAT: 2
(I) HAS OR IS PROJECTED TO HAVE AN AGGREGATE MONTHLY 3
DEMAND OF AT LEAST 25 MEGAWATTS; AND 4
(II) HAS OR IS PROJECTED TO HAVE A LOAD FACTO R OF MORE 5
THAN 80%. 6
(3) “SURPLUS INTERCONNECTI ON” MEANS THE AMOUNT OF 7
INTERCONNECTION CAPA CITY AVAILABLE AT AN EXISTING INTERCONNEC TION 8
POINT THAT IS NOT CU RRENTLY BEING UTILIZ ED BY EXISTING GENER ATION 9
FACILITIES. 10
(B) A LARGE LOAD CUSTOMER THAT PURCHASES INTERCONNECTION 11
CAPACITY FROM INTERCONNECTION POINTS WITH SURPLUS INTERCONNECT ION 12
POTENTIAL IS EXEMPT FROM REQUIREMENTS TO OBTAIN A CERTIFICATE OF PUBLIC 13
CONVENIENCE AND NECE SSITY UNDER § 7–207 OF THIS SUBTITLE FOR THAT 14
LOCATION. 15
(C) (1) THE COMMISSION SHALL ESTA BLISH A N INTERCONNECTION 16
PROCESS FOR LARGE LOAD CUSTOMERS. 17
(2) THE PROCESS REQUIRED UNDER THIS SUBSECTION: 18
(I) SHALL INCLUDE: 19
1. A STANDARD TIMELINE; AND 20
2. AN EXPEDITED TIMELIN E FOR LARGE LOAD 21
CUSTOMERS THAT PROVI DE INTERCONNECTION CAPACITY FOR 100% OF THEIR 22
LOAD; AND 23
(II) MAY NOT IMPACT THE T IMEFRAME OR ABILITY OF 24
CUSTOMERS THAT ARE N OT LARGE LOAD CUSTOM ERS TO INTERCONNECT TO THE 25
ELECTRIC SYSTEM. 26
(3) NOTHING IN THIS SUBSECTION SHALL BE CON STRUED TO LIMIT 27
THE REQUIREMENTS UNDER § 4–212 OF THIS ARTICLE. 28
(D) (1) A LARGE LOAD CUSTOMER MAY NOT INTERCONNECT TO THE 29
ELECTRIC SYSTEM UNLESS THE CUSTOMER PROVIDES INTERCONNECTION 30
CAPACITY FOR 25% OF THE CUSTOMER’S LOAD THROUGH: 31
HOUSE BILL 940 3
(I) BEHIND–THE–METER ENERGY STORAGE FACILITIES; 1
(II) PURCHASING CAPACITY WITH NEWLY INTERCONN ECTED 2
ENERGY STORAGE FACILITIES WITHIN THE LOAD ZONE OR LOCAL DELIVERY AREA; 3
(III) PURCHASING CAPACITY WITH NEW CARBON –FREE ASSETS 4
IN THE LOAD ZONE OR LOCAL DELIVERY AREA; OR 5
(IV) DEMAND RESPONSE. 6
(2) A LARGE LOAD CUSTOMER THAT PROVIDES CAPACITY FOR 100% 7
OF THE CUSTOMER ’S LOAD THROUGH ANY O F THE METHODS SPECIFIED IN 8
PARAGRAPH (1) OF THIS SUBSECTION AND PAYS THE PREVAIL ING WAGE RATE 9
SHALL BE PRIORITIZED FOR: 10
(I) LOAD STUDIES; 11
(II) INTERCONNECTION; AND 12
(III) PERMITTING. 13
(3) ANY CAPACITY THAT A L ARGE LOAD CUSTOMER P URCHASES 14
THROUGH THE USE OF SURPLUS INTERCONNECTION SHALL OFFSET THE CAPACITY 15
PROVIDED THROUGH THE METHODS SPECIFIED IN PARAGRA PH (1) OF THIS 16
SUBSECTION. 17
(E) (1) BEFORE SIGNING A CONT RACT FOR SERVICE , A LARGE LOAD 18
CUSTOMER SHALL: 19
(I) SUBMIT A REQUEST FOR A LOAD STUDY TO DETERMINE THE 20
NECESSARY CONTRACT CAPACITY FOR THE LARGE LOAD CUSTOMER; AND 21
(II) PAY: 22
1. A FEE IN AN AMOUNT TO BE SET BY THE COMMISSION 23
BUT NOT LESS THAN $ 1,000 PER MEGAWATT OF LOAD TO BE SERVED; AND 24
2. ANY OTHER APPLICABLE FEES ASSOCIATED WITH THE 25
STUDY. 26
(2) THE FEES REQUIRED UND ER PARAGRAPH (1)(II) OF THIS 27
SUBSECTION SHALL BE USED ONLY AS FOLLOWS: 28
4 HOUSE BILL 940
(I) 50% OF THE FEES COLLECTE D SHALL BE USED FOR THE 1
ELECTRIC UNIVERSAL SERVICE PROGRAM ESTABLISHED UNDER § 7–512.1 OF THIS 2
TITLE; AND 3
(II) 50% OF THE FEES C OLLECTED SHALL BE US ED FOR THE 4
DEPARTMENT OF HOUSING AND COMMUNITY DEVELOPMENT’S EMPOWER 5
MARYLAND LIMITED INCOME ENERGY EFFICIENCY PROGRAM. 6
7–1008. 7
(A) (1) IN THIS SECTION THE FOLLOWING WORDS HAVE THE MEANINGS 8
INDICATED. 9
(2) “LARGE LOAD CUSTOMER ” HAS THE MEANING STAT ED IN § 10
7–219.1 OF THIS TITLE. 11
(3) “PROGRAM” MEANS THE DEMAND RESPONSE PROGRAM. 12
(B) THE COMMISSION SHALL ESTABLISH A DEMAND RESPONSE PROGRAM 13
FOR LARGE LOAD CUSTOMERS. 14
(C) THE COMMISSION SHALL OFFE R EACH LARGE LOAD CU STOMER THAT 15
PARTICIPATES IN THE PROGRAM THE OPTION OF CONTRACTING FOR: 16
(1) 6 NONCONSECUTIVE 4–HOUR PERIODS OF LOAD MANAGEMENT OR 17
DEMAND–SIDE MANAGEMENT TIME SLOTS PER CALENDAR YEAR; OR 18
(2) 10 NONCONSECUTIVE 10–HOUR PERIODS OF LOAD MANAGEMENT 19
OR DEMAND–SIDE MANAGEMENT TIME SLOTS PER CALENDAR YEAR. 20
(D) THE COMMISSION SHALL: 21
(1) DEVELOP A CLEAR COMP ENSATION STRUCTURE O R FINANCIAL 22
INCENTIVES FOR PROGRAM PARTICIPATION; 23
(2) ESTABLISH A CLEARL Y DEFINED PENALTY SY STEM FOR 24
NONPERFORMANCE DURIN G ANY FORCE MAJEURE EVENTS BY A PARTICIP ATING 25
LARGE LOAD CUSTOMER; 26
(3) ESTABLISH A DISPUTE RESOLUTION PROCESS; AND 27
HOUSE BILL 940 5
(4) ESTABLISH MULTIPLE N OTIFICATION AND COMMUNICATION 1
CHANNELS FOR PARTICIPATING LARGE LOAD CUSTOMERS. 2
(E) EACH ELECTRIC COMPANY SHALL PROVIDE PARTIC IPATING LARGE 3
LOAD CUSTOMERS: 4
(1) 24 HOURS OF ADVANCE NOT ICE OF POTENTIAL DEM AND 5
RESPONSE PERIODS; AND 6
(2) 30 MINUTES OF NOTICE BEFORE EACH DEMAND RESPONSE 7
PERIOD. 8
(F) THE COMMISSION SHALL ADOPT REGULATIONS THAT: 9
(1) PROHIBIT BEHIND–THE–METER ENERGY STORAGE FACILITIES 10
FROM BEING INCLUDED IN A PARTICIPATING LARGE LOAD CUSTOMER’S LOAD; 11
(2) DEVELOP GUIDELINES A ND LIMITATIONS FOR C HARGING 12
BEHIND–THE–METER ENERGY STORAGE FACILITIES D URING CERTAIN PEAK 13
DEMAND, AS DETERMINED BY THE COMMISSION; AND 14
(3) ESTABLISH A METHOD FOR MEASURING A PARTICIPATING LARGE 15
LOAD CUSTOMER ’S DEMAND RESPONSE PERFORMANCE IN ACCORDANCE WITH 16
SUBSECTION (G) OF THIS SECTION. 17
(G) IN MEASURING A PARTICIPATING LARGE LOAD CUSTOMER ’S DEMAND 18
RESPONSE PERFORMANCE, THE COMMISSION SHALL FACTOR IN: 19
(1) NEW VIRTUAL POWER PL ANT AGGREGATION OPTI ONS 20
DEVELOPED BY ELECTRIC COMPANIES; 21
(2) FRONT–OF–METER ENERGY STORAGE FACILITIES; AND 22
(3) NONWIRE ALTERNATIVES , INCLUDING GRID ENHAN CING 23
TECHNOLOGIES, THAT FEED ELECTRICITY BACK TO THE ELECTRIC SYSTEM. 24
(H) A PARTICIPATING LARGE LOAD CUSTOMER CONSTRUCTING A 25
BEHIND–THE–METER ENERGY STORAGE FACILITY UNDER THE PROGRAM IS EXEMPT 26
FROM THE REQUIREMENTS TO: 27
(1) OBTAIN A CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY 28
UNDER § 7–207 OF THIS TITLE; OR 29
6 HOUSE BILL 940
(2) OBTAIN COMMISSION APPROVAL UNDER § 7–207.1 OF THIS TITLE. 1
SECTION 2. AND BE IT FURTHER ENACTED, That: 2
(a) On or before December 31, 2026, the Maryland Energy Administration shall 3
complete a study of each electricity supplier with generating facilities located in the State 4
to determine the surplus interconnection potential at each interconnection point. 5
(b) (1) The Administration shall report a summary of the results of the study 6
to the General Assembly, in accordance with § 2 –1257 of the State Government Article, 7
including the total surplus interconnection potential available in the State. 8
(2) The summary: 9
(i) shall describe the total surplus interconnection potential 10
available in the State; but 11
(ii) may not itemize the surplus interconnection potential by electric 12
company or interconnection point. 13
(c) The Administration shall share the results of the study with data center 14
developers in order to encourage the use of surplus interconnection. 15
SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 16
October 1, 2026. 17