Retail Supply of Electricity and Gas

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*sb0997*

SENATE BILL 997
C5 6lr3040

By: Senators Jennings and Gallion
Introduced and read first time: February 23, 2026
Assigned to: Rules

A BILL ENTITLED

AN ACT concerning 1

Retail Supply of Electricity and Gas 2

FOR the purpose of altering the amount of a certain assessment charge; altering the 3
definition of “marketing” and the content of certain materials for purposes of an 4
electric company, a gas company, or an electric cooperative recovering certain costs 5
through rates; altering certain authorizations and restrictions on the offer and sale 6
of certain electricity supply and gas supply; repealing certain provisions relating to 7
regulating the price of green power; abolishing a certain division within the Public 8
Service Commission; providing for the transfer of certain employees; and generally 9
relating to retail energy supply. 10

BY repealing and reenacting, without amendments, 11
Article – Public Utilities 12
Section 2–110(a), 7–507(a), 7–603.1(b)(1), and 7–604.2(a) 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 2–110(b) 18
Annotated Code of Maryland 19
(2025 Replacement Volume and 2025 Supplement) 20
(As enacted by Chapters 7 and 19 of the Acts of the General Assembly of the 2025 21
Special Session) 22

BY repealing and reenacting, with amendments, 23
Article – Public Utilities 24
Section 2–110(c)(12) 25
Annotated Code of Maryland 26
(2025 Replacement Volume and 2025 Supplement) 27
(As enacted by Chapters 7 and 19 of the Acts of the General Assembly of the 2025 28
2 SENATE BILL 997

Special Session) 1

BY repealing and reenacting, with amendments, 2
Article – Public Utilities 3
Section 7–316, 7–507(l)(4), 7–510(d), 7–603.1(b)(3), 7–604.2(b), and 7–707 4
Annotated Code of Maryland 5
(2025 Replacement Volume and 2025 Supplement) 6

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 7
That the Laws of Maryland read as follows: 8

Article – Public Utilities 9

2–110. 10

(a) In this section, “public service company” includes an electricity supplier and a 11
gas supplier as those terms are defined in § 1–101 of this article. 12

(b) (1) The costs and expenses of the Commission, the Strategic Energy 13
Planning O ffice, and the Office of People’s Counsel shall be borne by the public service 14
companies that are subject to the Commission’s jurisdiction. 15

(2) The costs and expenses shall be assessed as provided in this section. 16

(3) The Commission shall pay the money that it collects for the assessment 17
under this section into the Public Utility Regulation Fund in the State Treasury established 18
under § 2–110.1 of this subtitle to reimburse the State for the expenses of the Commission, 19
the Strategic Energy Planning Office, and the Office of People’s Counsel. 20

(c) (12) The total amount that may be charged to a public service company 21
under this section for a State fiscal year may not exceed: 22

(i) [0.50%] 0.25% of the public service company’s gross operating 23
revenues derived from intrastate utility and electricity supplier operations in the preceding 24
calendar year, or other 12–month period that the Chairman determines, for the costs and 25
expenses of the Commission other than that of the Strategic Energy Planning Office and 26
the Office of People’s Counsel; plus 27

(ii) 0.074% of those revenues for the costs and expenses of the 28
Strategic Energy Planning Office; plus 29

(iii) 0.074% of those revenues for the costs and expenses of the Office 30
of People’s Counsel. 31

7–316. 32

SENATE BILL 997 3

(a) In this section, “marketing” does not include materials to educate or inform , 1
IN A NEUTRAL MANNER , a retail customer about standard offer service, default gas 2
commodity service, or customer choice. 3

(b) Except as provided in subsection (d) of this sec tion, an electric company or a 4
gas company may not recover through its rates any costs associated with marketing its 5
services. 6

(c) An electric cooperative may recover through its rates any costs associated with 7
marketing its services, including the costs associated with materials that educate or inform, 8
IN A NEUTRAL MANNER, a retail customer about standard offer service or customer choice. 9

(d) The Commission may, by regulation, adopt criteria for reviewing marketing 10
and other communication materials of an electric company or a gas company to determine 11
whether the cost of the materials may be recovered through the company’s rates. 12

7–507. 13

(a) A person, other than an electric company providing standard offer service 14
under § 7–510(c) of this subtitle, a municipal electric utility serving customers solely in its 15
distribution territory, the Department of General Services selling energy under § 7 –704.4 16
of this title, or a community choice aggregator under § 7 –510.3 of this subtitle, may not 17
engage in the busi ness of an electricity supplier in the State unless the person holds a 18
license issued by the Commission. 19

(l) (4) Each INSTANCE OF A customer [to whom electricity is] BEING sold or 20
offered ELECTRICITY in violation of this section is a separate violation. 21

7–510. 22

(d) (1) This subsection applies to residential electricity supply other than 23
supply offered through: 24

(i) standard offer service; 25

(ii) the Department of General Services’ sale of energy under § 26
7–704.4 of this title; or 27

(iii) a community choice aggregator under § 7–510.3 of this subtitle. 28

(2) A residential electricity supplier: 29

(i) [may offer electricity, other than green power, only at a price that 30
does not exceed the trailing 12 –month average of the electric company’s standard offer 31
service rate in the electric company’s service territory as of the date of agreement with the 32
customer; 33
4 SENATE BILL 997

(ii)] may offer residential electricity supply only for a term not to 1
exceed [12] 36 months at a time; 2

[(iii)] (II) may, for electricity supply other than green power, 3
automatically renew the term only if the electricity supplier provides notice to the customer 4
[90] 60 days before and 30 days before renewal; 5

[(iv)] (III) may offer green power that meets the requirem ents of § 6
7–707 of this title, but may not automatically renew the term with the customer; 7

[(v) subject to paragraph (3) of this subsection, may not offer a 8
variable rate other than a rate that adjusts for seasonal variation not more than twice in a 9
single year; and 10

(vi)] (IV) may not pay a commission or other incentive –based 11
compensation to an energy salesperson for enrolling customers; 12

(V) 1. MAY OFFER CANCELLATION OR EARLY TERMINATION 13
OF AN ELECTRICITY SUPPLY AGREEMENT WITH A 3–DAY RESCISSION PERIOD; AND 14

2. MAY NOT IMPOSE ON A CUSTOMER A FEE FOR 15
CANCELLATION OR EARLY TERMINATION OF AN ELECTRICITY SUPPLY AGREEMENT 16
THAT EXCEEDS THE GREATER OF: 17

A. $200; OR 18

B. 5% OF THE REMAINING VALUE OF THE AGREEMENT; 19

(VI) MAY NOT OFFER INDUCEMENTS, INCLUDING: 20

1. GIFT CARDS; 21

2. MONEY; 22

3. PRIZES; 23

4. TRIPS; OR 24

5. ANY OTHER ITEMS CONTINGENT ON ENROLLMENT; 25

(VII) MAY NOT ENGAGE IN DOOR –TO–DOOR SOLICITATION 26
UNLESS AS PART OF A CUSTOMER–INITIATED APPOINTMENT; AND 27

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(VIII) MAY PROVIDE EDUCATIONAL MATERIALS: 1

1. WITH A VALUE OF $10 OR LESS; AND 2

2. THAT ARE NOT CONTINGENT ON ENROLLMENT. 3

(3) [Paragraph (2)(v) of this subsection does not prohibit the offer and use 4
of time–of–use rates that establish different rates for periods within a single day. 5

(4)] A residential electricity supplier may not sell to an electric company, 6
and an electric company may not purchase from the electricity supplier, accounts 7
receivable. 8

(4) THE COMMISSION SHALL ADOPT REGULATIONS: 9

(I) DEFINING ACTIONS PROHIBITED UNDER THIS SUBSECTION; 10
AND 11

(II) SPECIFYING THE PROCE SS FOR ENFORCING THE 12
PROVISIONS OF THIS SUBSECTION. 13

7–603.1. 14

(b) (1) (i) A gas supplier, an energy vendor, or any other person, except for 15
an energy salesperson, selling or offering to sell gas in the State in violation of this section 16
or § 7–603 of this subtitle, after notice and an opportunity for a hearing, is subject to: 17

1. a civil penalty of not more than $25,000 for the violation; 18

2. license denial, revocation, or suspension or refusal to 19
renew the license; or 20

3. both. 21

(ii) An energy salesperson selling or offering to sell gas in the State 22
in violation of this section or § 7 –603 of this subtitle, after notice and an opportunity for a 23
hearing, is subject to license denial, revocation, or suspension or refusal to renew the 24
license. 25

(3) Each INSTANCE OF A customer [to whom gas is] BEING sold or offered 26
GAS in violation of this section is a separate violation. 27

7–604.2. 28

(a) In this section, “default gas commodity service” means the supply of retail gas 29
commodity service by a customer’s gas company. 30
6 SENATE BILL 997

(b) (1) This subsection applies to residential gas supply other than default gas 1
commodity service provided by a gas company. 2

(2) A gas supplier that supplies gas to residential retail gas customers: 3

(i) [may offer gas service only at a price that does not exceed the 4
trailing 12–month average of the gas company’s default gas commodity service in the gas 5
company’s service territory as of the date of the agreement with the customer; 6

(ii)] may offer residential gas supply only for a term not to exceed [12] 7
36 months at a time and may automatically renew the term only if the gas supplier provides 8
notice to the customer [90] 60 days before and 30 days before renewal; 9

[(iii) subject to paragraph (3) of this subsection, may not offer a 10
variable rate other than a rate that adjusts for seasonal variation not more than twice in a 11
single year; and 12

(iv)] (II) may not pay a commission or other incentive –based 13
compensation to an energy salesperson for enrolling customers; 14

(III) 1. MAY OFFER CANCELLATION OR EARLY TERMINATION 15
OF A GAS SUPPLY AGREEMENT WITH A 3–DAY RESCISSION PERIOD; AND 16

2. MAY NOT IMPOSE ON A CUSTOMER A FEE FOR 17
CANCELLATION OR EARL Y TERMINATION OF A G AS SUPPLY AGREEMENT THAT 18
EXCEEDS THE GREATER OF: 19

A. $200; OR 20

B. 5% OF THE REMAINING VALUE OF THE AGREEMENT; 21

(IV) MAY NOT OFFER INDUCEMENTS, INCLUDING: 22

1. GIFT CARDS; 23

2. MONEY; 24

3. PRIZES; 25

4. TRIPS; OR 26

5. ANY OTHER ITEMS CONTINGENT ON ENROLLMENT; 27

SENATE BILL 997 7

(V) MAY NOT ENGAGE IN DO OR–TO–DOOR SOLICITATION 1
UNLESS AS PART OF A CUSTOMER–INITIATED APPOINTMENT; AND 2

(VI) MAY PROVIDE EDUCATIONAL MATERIALS: 3

1. WITH A VALUE OF $10 OR LESS; AND 4

2. THAT ARE NOT CONTINGENT ON ENROLLMENT. 5

(3) [Paragraph (2)(iii) of this subsection does not prohibit the offer and use 6
of rates that differ based on the total number of therms used by a customer in any billing 7
period. 8

(4)] A gas supplier that supplies gas to residential retail gas customers may 9
not sell to a gas company, and a gas company may not purchase from the gas supplier, 10
accounts receivable. 11

(4) THE COMMISSION SHALL ADOPT REGULATIONS: 12

(I) DEFINING ACTIONS PROHIBITED UNDER THIS SUBSECTION; 13
AND 14

(II) SPECIFYING THE PROCE SS FOR ENFORCING THE 15
PROVISIONS OF THIS SUBSECTION. 16

7–707. 17

(a) In this section, “green power” means energy sources or renewable energy 18
credits that are marketed as clean, green, eco –friendly, envir onmentally friendly or 19
responsible, carbon–free, renewable, 100% renewable, 100% wind, 100% hydro, 100% solar, 20
100% emission–free, or similar claims. 21

(b) This section does not apply to: 22

(1) the Department of General Services when the Department of Gen eral 23
Services sells energy under § 7–704.4 of this subtitle; 24

(2) a community choice aggregator under § 7–510.3 of this title; or 25

(3) an electricity supplier when supplying electricity to commercial retail 26
electric customers. 27

(c) An electricity supp lier that supplies electricity to residential retail electric 28
customers may not market electricity as green power unless: 29

8 SENATE BILL 997

(1) the percentage of the electricity being offered, or the equivalent number 1
of renewable energy credits associated with the electricity being marketed as green power, 2
that is eligible for inclusion in meeting the renewable energy portfolio standard equals or 3
exceeds the greater of: 4

(i) 51%; or 5

(ii) 1% higher than the renewable energy portfolio standard for the 6
year the electricity is provided to the customer; AND 7

(2) [the Commission approves the price of the electricity being marketed 8
as green power in accordance with subsection (d) of this section; and 9

(3)] the electricity supplier submits an application to the Commission that: 10

(i) describes the electricity being marketed as green power, 11
including the green power source and percentage of the electricity that is green power; 12

(ii) describes how the green power complies with State law and 13
regulations; and 14

(iii) includes any other information the Commission considers 15
necessary. 16

(d) [(1) The price approved by the Commission under subsection (c)(2) of this 17
section shall be determined through: 18

(i) a proceeding held in accordance with paragraph (2) of this 19
subsection; or 20

(ii) a proceeding held in accordance with paragraph (3) of this 21
subsection. 22

(2) (i) Each year the Commission shall hold a proceeding to set a price 23
per megawatt–hour for electricity marketed as green power under this section that may 24
not be exceeded by an electricity supplier except as provided in paragraph (3) of this 25
subsection. 26

(ii) Subject to paragraph (4) of this subsection, the price set by the 27
Commission under subparagraph (i) of this paragraph may: 28

1. exceed the maxim um price per megawatt –hour that is 29
authorized under § 7–510(d)(2)(i) of this title; and 30

2. differ based on the amount and source of the electricity 31
generation. 32

SENATE BILL 997 9

(iii) During a proceeding held under subparagraph (i) of this 1
paragraph, the Commission: 2

1. shall consider: 3

A. the price of the energy purchased, including the total cost 4
of the renewable energy credits; 5

B. the amount of electricity that is eligible for inclusion in 6
meeting the renewable energy portfolio standard; 7

C. the state in which the electricity was generated; and 8

D. applicable market data; and 9

2. may consider whether the purchase of renewable energy 10
credits was bundled with a power purchase agreement from the energy sources associated 11
with the credit. 12

(3) (i) On request by an electricity supplier, the Commission shall hold 13
a proceeding to set a price per megawatt –hour for electricity marketed as green power for 14
that electricity supplier. 15

(ii) Subject to paragraph (4) of this subsection, at a proceeding held 16
under this paragraph the Commission may set a price per megawatt –hour that is higher 17
than the price determined in the proceeding held under paragraph (2) of this subsection for 18
an electricity supplier if: 19

1. the electricity supplier demonstrates to the Commission’s 20
satisfaction, based on an independent third –party audit, that the actual cost to the 21
electricity supplier for the generation or supply of electricity exceeds that of the price 22
determined through the proceeding held in accor dance with paragraph (2) of this 23
subsection; 24

2. the increased price reflects only the cost of the electricity 25
marketed as green power and is not associated with any of the electricity supplier’s other 26
costs; and 27

3. the electricity supplier demonstrates to the Commission’s 28
satisfaction that the electricity supplier has a significant long –term investment in 29
renewable energy that meets the renewable energy portfolio standard under § 7–703 of this 30
subtitle. 31

(iii) During a proceeding held under this paragraph, the Commission 32
shall consider: 33

10 SENATE BILL 997

1. whether the purchase of renewable energy credits was 1
bundled with a power purchase agreement from the energy sources associated with the 2
credit; 3

2. the price of the energy purchased, including the total cost 4
of the renewable energy credits or power purchase agreements; 5

3. the amount of electricity that is eligible for inclusion in 6
meeting the renewable energy portfolio standard; 7

4. the state in which the electricity was generated; and 8

5. applicable market data. 9

(4) (i) A price approved by the Commission under this subsection may 10
not exceed 150% of the maximum price per megawatt –hour that is authorized under § 11
7–510(d)(2)(i) of this title unless the Commission determines that the a ctual cost of the 12
green power exceeds that amount. 13

(ii) Within 120 days after approving a price for green power that 14
exceeds 150% of the maximum price per megawatt –hour that is authorized under § 15
7–510(d)(2)(i) of this title, and annually for as long as the price exceeds that amount, the 16
Commission shall submit a report to the General Assembly, in accordance with § 2–1257 of 17
the State Government Article, that: 18

1. demonstrates that the approved price represents only the 19
actual price of the green power; and 20

2. includes the Commission’s order authorizing the price of 21
the green power. 22

(iii) If the Commission has approved for 3 consecutive years a price 23
for green power that exceeds 150% of the maximum price per megawatt –hour that is 24
authorized under § 7–510(d)(2)(i) of this title, the Commission shall include in the annual 25
report required under subparagraph (ii) of this paragraph: 26

1. information on market conditions that necessitate the 27
approved price of the green power that exceeds 150% of the maximum price per 28
megawatt–hour that is authorized under § 7–510(d)(2)(i) of this title; and 29

2. a recommendation of whether to increase the limitation on 30
the maximum price of green power above which the Commission is required to make a 31
determination under this paragraph. 32

(5) The Commission: 33

SENATE BILL 997 11

(i) shall annually review a price approved under paragraph (3) of 1
this subsection; and 2

(ii) may, on its own initiative, or on petition by the Office of People’s 3
Counsel, require an electricity supplier offering green power under a price established 4
under paragraph (3) of this subsection to demonstrate that the price continues to meet the 5
requirements of paragraph (3) of this subsection. 6

(e)] (1) On and after January 1, 2025, an electricity sup plier shall purchase 7
renewable energy credits for each year the electricity supplier offers green power for sale 8
to residential retail electric customers. 9

(2) A renewable energy credit an electricity supplier purchases under 10
paragraph (1) of this subsec tion shall be retired in a PJM Environmental Information 11
Services, Inc., generation attribute tracking system reserve subaccount accessible by the 12
Commission. 13

[(f)] (E) (1) This subsection does not apply to: 14

(i) the Department of General Services whe n the Department of 15
General Services sells energy under § 7–704.4 of this subtitle; or 16

(ii) a community choice aggregator under § 7–510.3 of this title. 17

(2) An electricity supplier that claims in the electricity supplier’s 18
marketing of electricity t o residential retail electric customers that the customer will be 19
purchasing green power shall include the following disclosure or a similar disclosure 20
approved by the Commission: 21

“We deliver energy through the purchase of Renewable Energy Credits (RECs) . A 22
REC represents the social good that accompanies 1 megawatt–hour of renewable electricity 23
generation. RECs may be sold separately from renewable electricity itself. Renewable 24
electricity and RECs may be sold to different entities. The purchase of a REC does not 25
indicate that renewable electricity itself has been purchased by the entity that purchased 26
the REC.”. 27

[(g)] (F) In addition to the disclosure required under subsection [(f)] (E) of this 28
section, the Commission shall adopt regulations that require an electricity supplier, other 29
than the Department of General Services when the Department of General Services sells 30
energy under § 7–704.4 of this subtitle or a community choice aggrega tor under § 7–510.3 31
of this title, that offers green power for sale to residential retail customers to include in the 32
electricity supplier’s marketing materials a disclosure, written in plain language, that 33
explains: 34

(1) what the customer will actually be paying for when the customer 35
purchases green power from the electricity supplier; 36

12 SENATE BILL 997

(2) how the electricity that the customer has purchased is generated; 1

(3) how the green power will benefit the environment; 2

(4) the percentage of electricity that would be provided by the electricity 3
supplier that is eligible for inclusion in meeting the renewable energy portfolio standard; 4
and 5

(5) the state in which the electricity was generated. 6

[(h)] (G) The Commission, in its discretion, may determine whet her an 7
electricity supplier is marketing electricity in accordance with this section. 8

SECTION 2. AND BE IT FURTHER ENACTED, That the division within the Public 9
Service Commission established in accordance with Section 2 of Chapter 537 of the Acts of 10
the General Assembly of 2024 shall be abolished. Any Position Identification Numbers 11
(PINs) created in accordance with Section 2 of Chapter 537 of the Acts of the General 12
Assembly of 2024 shall remain with the Commission and any employee hired or assigned 13
to t hat division shall be reassigned to an equivalent position elsewhere within the 14
Commission. No employee affected by a reassignment in accordance with this section shall 15
suffer any diminution in pay or benefits resulting from the reassignment. 16

SECTION 3. AND BE IT FURTHER ENACTED, That, on or before January 1, 2027, 17
the Public Service Commission shall adopt regulations to carry out this Act. 18

SECTION 4. AND BE IT FURTHER ENACTED, That this Act shall be construed to 19
apply only prospectively and may not be applied or interpreted to have any effect on or 20
application to any electricity supply agreement or gas supply agreement that is in effect on 21
or before the effective date of this Act. 22

SECTION 5. AND BE IT FURTHER ENACTED, That this Act shall take effect 23
October 1, 2026. 24