A bipartisan group of state legislators is urging FERC to not stick Maryland ratepayers with infrastructure costs associated with out-of-state data centers.
Last week, a bipartisan group of 80 State Senators and Delegates sent a letter to the Federal Energy Regulatory Commission urging federal regulators to reject efforts to saddle Maryland ratepayers with billions of dollars in out-of-state infrastructure costs. Transmission projects tied to data center development and already approved by federal regulators are projected to increase utility bills by approximately $2 billion statewide. None of those projects are located in Maryland, and no Maryland residents or jurisdictions directly benefit from the facilities driving the costs.
According to their letter,
…the rules require our Maryland constituents to pay for projects that would not be built but for forecasted data center electric demand growth. Most of the projected data center growth is occurring outside of Maryland borders and substantial amounts may be speculative and never built. . . . While PJM’s rules are unfair for many PJM states, they impact Maryland disproportionately simply because Maryland sits next to Data Center Alley in Virginia, which houses the world’s largest concentration of hyperscale data centers.
The Commission must fix PJM’s unfair cost allocation methods to meet the customer-protection commitments embodied in the White House and PJM governors’ statement of principles and the Ratepayer Protection Pledge. The pledge—which was advanced by the White House and agreed to by major tech companies, including Amazon, Google, Meta, Microsoft, xAI, Oracle and OpenAI—states that the companies “will pay for new power delivery infrastructure upgrades to service their data centers, including adequate network upgrade costs to ensure that these expenses are not passed on to the ordinary household.”
For Maryland, energy demand continues to be one of the central public policy issues. Demand for electricity is rising quickly, but new energy generation is not keeping pace. This mismatch is contributing to higher costs for residents and businesses.
If you’re following energy issues, be sure to check out The Briefing Room, a new limited series from the Conduit Street Podcast. Airing Tuesdays this summer, the series breaks down complex topics over several weeks through conversations with key decision-makers shaping Maryland’s policy landscape. Our first five episodes focus on energy: from grid reliability and generation challenges to local siting concerns and rising demand. The Briefing Room offers county leaders and policy watchers a clear, accessible look at the issues driving Maryland’s public policy landscape.
