Electric Companies - Cost Containment Plans - Requirement (Securing Affordable, Valuable Investments in Next Generation Grid Solutions) (SAVINGS Act)

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*sb0598*

SENATE BILL 598
C5 6lr1973
CF HB 723
By: Senator Hester
Introduced and read first time: February 5, 2026
Assigned to: Education, Energy, and the Environment

A BILL ENTITLED

AN ACT concerning 1

Electric Companies – Cost Containment Plans – Requirement 2
(Securing Affordable, Valuable Investments in Next Generation Grid Solutions 3
(SAVINGS) Act) 4

FOR the purpose of requiring electric companies to submit to the Public Service 5
Commission cost containment plans for electric distribution and transmission 6
system planning at certain times; requiring the plans to combine to reduce peak 7
electric system loads in a certain manner; requiring electric companie s to submit 8
certain progress reports on the implementation of the plan; and generally relating to 9
electric companies and electric system cost containment planning. 10

BY adding to 11
Article – Public Utilities 12
Section 7–805 13
Annotated Code of Maryland 14
(2025 Replacement Volume and 2025 Supplement) 15

BY repealing and reenacting, without amendments, 16
Article – Public Utilities 17
Section 7–1001(a) and (d) 18
Annotated Code of Maryland 19
(2025 Replacement Volume and 2025 Supplement) 20

SECTION 1. BE IT ENACTED BY THE GE NERAL ASSEMBLY OF MARYLAND, 21
That the Laws of Maryland read as follows: 22

Article – Public Utilities 23

7–805. 24

2 SENATE BILL 598

(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 1
INDICATED. 2

(2) (I) “ADVANCED TRANSMISSION TECHNOLOGIES” MEANS 3
INFRASTRUCTURE, HARDWARE, OR SOFTWARE THAT INC REASES THE CAPACITY , 4
EFFICIENCY, RELIABILITY, OR RESILIENCE OF A N EW OR EXISTING TRANS MISSION 5
LINE FACILITY. 6

(II) “ADVANCED TRANSMISSION TECHNOLOGIES” INCLUDES: 7

1. GRID–ENHANCING TECHNOLOGIES; 8

2. HIGH–PERFORMANCE CONDUCTORS; AND 9

3. STORAGE USED AS TRANSMISSION. 10

(3) (I) “AUTOMATED LOAD MANAGE MENT” MEANS THE USE OF A 11
POWER CONTROL SYSTEM TO LIMIT OR CONTROL ELECTRIC CURRENT OR POWER TO 12
STAY WITHIN SAFE , DEFINED LIMITS IN AC CORDANCE WITH ELECTR IC INDUSTRY 13
STANDARDS. 14

(II) “AUTOMATED LOAD MANAGEMENT” INCLUDES: 15

1. A SINGLE DEVICE USED TO CONTROL ELECTRIC LOAD; 16
AND 17

2. MULTIPLE DEVICES OPE RATING TOGETHER AS A 18
SYSTEM TO CONTROL ELECTRIC LOAD. 19

(4) “DEMAND FLEXIBILITY” MEANS THE ABILITY TO SHIFT ENERGY 20
DEMAND TO MEET BULK POWER SYSTEM OR LOCA L DISTRIBUTION SYSTEM NEEDS 21
IN RESPONSE TO CHANGING ELECTRIC SYSTEM CONDITIONS AND PRICES IN ORDER 22
TO: 23

(I) INTEGRATE INCREASED RENEWABLE ENERGY SUPPLY; 24

(II) IMPROVE RELIABILITY AND ENERGY SYSTEM EFFICIENCY; 25

(III) LOWER COSTS; AND 26

(IV) REDUCE ENVIRONMENTAL IMPACTS BY DECREASIN G NET 27
SYSTEM PEAK DEMAND OR DISTRIBUTION SYSTEM PEAK DEMAND. 28

SENATE BILL 598 3

(5) “DISTRIBUTED ENERGY RE SOURCE” HAS THE MEANING STAT ED 1
IN § 7–1001 OF THIS TITLE. 2

(6) “ELECTRIC SYSTEM PLAN ” MEANS A PLAN SUBMITT ED BY AN 3
ELECTRIC COMPANY TO THE COMMISSION IN ACCORDA NCE WITH COMAR 4
20.50.15.04. 5

(7) (I) “FLEXIBLE INTERCONNECT ION” MEANS A METHOD FOR 6
CONNECTING DISTRIBUTED ENERGY RESOURCES TO THE ELECTRIC DISTRIBUTION 7
SYSTEM IN A MANNER T HAT OPTIMIZES THE USE OF THE EXISTING ELECTRI C 8
DISTRIBUTION SYSTEM. 9

(II) “FLEXIBLE INTERCONNECTION” INCLUDES THE USE OF A 10
LIMITED EXPORT AGREEMENT. 11

(8) “GRID–ENHANCING TECHNOLOGI ES” MEANS HARDWARE OR 12
SOFTWARE THAT INCREA SES THE CAPACITY OR EFFICIENCY OF THE ELECTRIC 13
DISTRIBUTION OR TRANSMISSION SYSTEM, INCLUDING: 14

(I) DYNAMIC LINE RATING; 15

(II) ADVANCED POWER FLOW CONTROL; 16

(III) TOPOLOGY OPTIMIZATION; AND 17

(IV) ENERGY STORAGE USED AS DISTRIBUTION OR 18
TRANSMISSION. 19

(9) “GRID FLEXIBILITY–ENABLED BUILDING ELECTR IFICATION AND 20
EFFICIENCY” MEANS A CHANGE IN EN D–USE EQUIPMENT TO AN EFFICIENT 21
ELECTRIC TYPE FOR AN Y BUILDING END –USE IF THE END –USE EQUIPMENT IS 22
PAIRED TO THE GREATEST EXTENT POSSIBLE WITH ENERGY EFFICIENCY MEASURES 23
AND ENROLLMENT IN DEMAND FLEXIBILITY PROGRAMS OR RATES TO EN COURAGE 24
THE USE OF THE ELECT RIC GRID IN OFF –PEAK HOURS AND MITIGATE USE DURING 25
PEAK DEMAND, INCLUDING A CHANGE IN END–USE EQUIPMENT FOR: 26

(I) WATER HEATING; 27

(II) SPACE HEATING; 28

(III) LAUNDRY; AND 29

(IV) INDUSTRIAL PROCESSES. 30
4 SENATE BILL 598

(10) “NONWIRES SOLUTION” MEANS A PROJECT OR OTHER SOLUTION 1
THAT USES ONE OR MOR E DISTRIBUTED ENERGY RESOURCES OR LEADS T O THE 2
INTRODUCTION OF NEW OR MODIFICATIONS OF EXISTING ENERGY MANA GEMENT 3
PRACTICES, STANDARDS, OR PROTOCOLS THAT ADDRESS A SYSTEM CONSTRAINT OR 4
PROVIDE OTHER ELECTRIC GRID SERVICES TO THE ELECTRIC SYSTEM. 5

(11) “VIRTUAL POWER PLANT ” MEANS A NETWORK OF M ULTIPLE, 6
DECENTRALIZED, DISTRIBUTED ENERGY R ESOURCES INTEGRATED TO BALANCE 7
ENERGY SUPPLY AND DEMAND ON A LARGE SCALE. 8

(B) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , ON OR 9
BEFORE JANUARY 1, 2027, AND EVERY 3 YEARS THEREAFTER , EACH ELECTRIC 10
COMPANY SHALL SUBMIT A COST CONTAINMENT PLAN TO THE COMMISSION. 11

(2) THE COMMISSION MAY: 12

(I) ALLOW ELECTRIC COMPA NIES TO SUBMIT THEIR 13
RESPECTIVE COST CONTAINMENT PLANS ON A STAGGERED SCHEDULE; AND 14

(II) ADJUST THE SUBMISSIO N PLAN DEADLINE IF T HE 15
COMMISSION REQUIRES OR ALLOWS AN ELECTRIC COMPANY TO SUBMIT IT S COST 16
CONTAINMENT PLAN AS A PART OF: 17

1. A MULTIYEAR RATE PLAN APPLICATION; 18

2. A RATE CASE FILING; OR 19

3. AN ELECTRIC SYSTEM PLAN. 20

(C) THE COST CONTAINMENT PLAN SHALL INCLUDE DESCRIPTIONS OF: 21

(1) ELECTRIC SYSTEM CONSTRAINT SOLUTIONS IN THE MOST RECENT 22
ELECTRIC SYSTEM PLAN SUBMITTED TO THE COMMISSION THAT AVOID OR 23
MINIMIZE CAPITAL EXP ENDITURES, INCLUDING ALL NONWIR ES SOLUTIONS AND 24
DISTRIBUTED ENERGY R ESOURCE INTEGRATION THAT IS INCLUDED IN THE 25
ELECTRIC SYSTEM PLAN; 26

(2) PROGRAMS, OFFERINGS, OR INVESTMENTS FROM OTHER FILINGS 27
MADE TO THE COMMISSION THAT AVOID OR MINIMIZE CAPITAL EXPENDITURES ON 28
THE ELECTRIC DISTRIB UTION OR TRANSMISSIO N SYSTEM WHILE IMPRO VING THE 29
RELIABILITY, RESILIENCE, AND CAPACITY OF THE ELECTRIC DISTRIBUTIO N OR 30
SENATE BILL 598 5

TRANSMISSION SYSTEM THAT ACHIEVES OPERAT IONAL AND PLANNING 1
OPTIMIZATION, INCLUDING: 2

(I) ADVANCED TRANSMISSION TECHNOLOGIES; 3

(II) AUTOMATED LOAD MANAGEMENT; 4

(III) DEMAND FLEXIBILITY; 5

(IV) FLEXIBLE INTERCONNECTION; 6

(V) GRID–ENHANCING TECHNOLOGIES; 7

(VI) GRID FLEXIBILITY; 8

(VII) GRID FLEXIBILITY–ENABLED BUILDING ELE CTRIFICATION 9
AND EFFICIENCY; AND 10

(VIII) VIRTUAL POWER PLANTS; 11

(3) HOW THE ELECTRIC COM PANY IS COORDINATING ELECTRIC 12
DISTRIBUTION SYSTEM INVESTMENTS WITH ELE CTRIC TRANSMISSION S YSTEM 13
PLANNING IN THE PJM REGION IN A MAN NER THAT IS MOST COS T–EFFECTIVE TO 14
RATEPAYERS; AND 15

(4) HOW THE ELECTRIC COM PANY IS INCREASING I TS INVESTMENTS 16
IN REGIONAL TRANSMIS SION PLANNING PROCES SES AND PROJECTS REL ATIVE TO 17
ITS INVESTMENTS IN LOCAL AND SUPPLEMENTAL TRANSMISSION PROJECTS. 18

(D) THE COST CONTAINMENT PLAN SUBMITTED UNDER SUBSECTION (C) OF 19
THIS SECTION SHALL COMBINE TO REDUCE THE UTILITY’S PEAK ELECTRIC SYSTEM 20
LOAD BY AT LEAST 20% FROM 2025 LEVELS BY 2030. 21

(E) (1) THE COMMISSION SHALL APPR OVE, CONDITIONALLY APPROVE, 22
OR DENY EACH ELEC TRIC COMPANY ’S COST CONTAINMENT P LAN BASED ON 23
WHETHER THE PLAN: 24

(I) ADEQUATELY INCORPORA TES THE REQUIREMENTS OF 25
SUBSECTION (C)(1) AND (2) OF THIS SECTION; 26

(II) MEETS OR EXCEEDS THE GOAL IN SUBSECTION (D) OF THIS 27
SECTION; AND 28

6 SENATE BILL 598

(III) IS PROJECTED TO PRODUCE DEMONSTRA BLE AND 1
SIGNIFICANT COST SAVINGS INDIVIDUALLY OR IN THE AGGREGATE, ACCORDING TO 2
THE COMMISSION’S UNIFIED BENEFIT COST ANALYSIS FRAMEWORK. 3

(2) THE COMMISSION SHALL REQU IRE AN ELECTRIC COMP ANY TO 4
CURE ANY DEFICIENCY IDENTIFIED DURING T HE COMMISSION’S REVIEW OF THE 5
COST CONTAINMENT PLAN. 6

(F) (1) EACH ELECTRIC COMPANY SHALL SUBMIT A PROGR ESS REPORT 7
TO THE COMMISSION ON THE ELE CTRIC COMPANY ’S PROGRESS TOWARD 8
IMPLEMENTING AN APPROVED COST CONTAINMENT PLAN. 9

(2) EACH ELECTRIC COMPANY SHALL SUBMIT THE PRO GRESS 10
REPORT AT THE SAME T IME THE ELECTRIC COM PANY SUBMITS ITS ELE CTRIC 11
SYSTEM PLAN AND SHALL INCLUDE: 12

(I) A DESCRIPTION OF ALL ONGOING ACTIONS, INITIATIVES, OR 13
PROJECTS AND ANY PLA NNED ACTIONS, INITIATIVES, OR PROJECTS INCLUDED IN 14
THE COST CONTAINMENT PLAN; AND 15

(II) AN ANALYSIS DOCUMENT ING THE DECISION –MAKING 16
PROCESS FOR THE SELE CTED ACTIONS, INITIATIVES, OR PROJECTS INCLUDED IN 17
THE COST CONTAINMENT PLAN AND ANY REJECTED ALTERNATIVES. 18

(G) IF AN ELECTRIC COMPAN Y FAILS TO MEET T HE GOAL UNDER 19
SUBSECTION (D) OF THIS SECTION, THE COMMISSION MAY, BY ORDER: 20

(1) IMPOSE ONE OR MORE FINES; 21

(2) REDUCE THE ELECTRIC COMPANY’S RETURN ON EQUITY; AND 22

(3) FULLY OR PARTIALLY D ENY THE ELECTRIC COM PANY’S COST 23
RECOVERY FOR IMPLEMENTING THE APPROVED COST CONTAINMENT PLAN. 24

7–1001. 25

(a) In this subtitle the following words have the meanings indicated. 26

(d) “Distributed energy resource” means an energy resource located on a 27
customer’s premises that: 28

(1) produces or stores electricity; or 29

SENATE BILL 598 7

(2) modifies the timing or amount of the customer’s electricity 1
consumption. 2

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 3
October 1, 2026. 4