(Photo by Joe Raedle/Getty Images)
The looming energy policy debate in the Maryland General Assembly might best be described as everything, everywhere, all at once.
Until recently the province of a few science nerds and policy wonks, the issue is suddenly getting a whole lot of attention in the State House. Lawmakers have arrived at a “holy s***” moment, and most believe they will have to act this year with urgency and clarity to address potential energy crises, something they are often reluctant to do.
And still, some legislators will privately confess that they don’t fully understand the terrain or the nomenclature — or the challenges at hand.
What they do know is that electricity prices are spiking for consumers while energy supplies are dwindling, at a time when Maryland is trying to foster a business environment that attracts more data centers, which are notorious power hogs. At the same time, the state is lagging when it comes to meeting its aggressive climate mandates and clean energy goals.
The public doesn’t seem to know who to blame for their higher electric bills. And environmental leaders are girding for possible rollbacks in climate protections and concessions to the fossil fuels industry to increase energy supply in the state.
“I think we are at a really significant inflection point on energy,” said Del. Lorig Charkoudian (D-Montgomery), one of the recognized legislative nerds in Annapolis on energy and utility policy.
In the opening days of this legislative session, lawmakers on energy and environmental committees received briefings on the regional electric grid, the challenges the state is facing to meet its clean energy goals, and a wonky concept known as co-location, which is relevant to the debate over how and where data centers get their electricity.
State agencies’ climate plans range from the ambitious to the mundane
Late last week, the House Economic Matters Committee held its first hearings on energy and climate bills, and Gov. Wes Moore’s administration introduced legislation to jumpstart the production of carbon-free energy. The plan relies heavily on expanding nuclear power in the state — a longterm proposition at best.
Legislative leaders are expected to unveil a comprehensive energy policy bill of their own later this week, though they’re keeping the specifics under wraps for a few more days.
“Ultimately, it is to increase domestic generation of energy in Maryland with an all-of-the-above approach, as well as make it easier for projects to site and exist in Maryland in a thoughtful way, as well as encouraging renewables,” Senate President Bill Ferguson (D-Baltimore City) told reporters Friday.
In an interview last week, House Economic Matters Chair C.T. Wilson (D-Charles), who has been a key member of the team crafting the legislation, said he and his colleagues are mindful of the rising costs of electricity and the need to generate more home-grown energy in Maryland. The state currently imports about 39% of its energy supply, according to the Maryland Energy Administration.
“I don’t think we’re going to do anything to hurt our constituents,” Wilson said.
‘We’re facing a reliability crisis’
Electricity generation, in the view of many experts, is the No. 1 energy challenge the state is facing.
The state’s three remaining coal plants are expected to close by 2027, and there currently aren’t any plans to make up for the lost production. What’s more, the operator of the regional electric grid, PJM Interconnection, has a backlog of dozens of proposed new energy generating projects in its 13-state territory that dates back to 2017.
“Because of PJM, not because of any state policy, we’re facing a reliability crisis,” Charkoudian said at a hearing earlier this month.
Jason M. Stanek, executive director of PJM and the former chair of the Maryland Public Service Commission, which regulates utilities, said the backlog has begun to ease since federal regulators approved the grid operator’s plan for expediting some of the project reviews.
It seems inevitable that the legislation House and Senate leaders are proposing will seek to encourage the development of at least one natural gas power plant in the state, perhaps at one of the coal plants that are shuttering. That won’t sit well with environmental leaders, who are already convinced that state law is unnecessarily extending the life of natural gas in Maryland through a lucrative incentive program for gas pipeline maintenance and replacement.
“Given the state’s commitment to reducing emissions through the Climate Solutions Act of 2022, any policy that incentivizes fossil fuels is contrary to state law and violates the spirit of the climate commitment in the state,” said Mike Tidwell, executive director of the Chesapeake Climate Action Network. “Any leader that proposes this will face a backlash.”
The legislative leaders’ bill is also almost certain to provide new incentives to expand nuclear energy in the state — a concept that is a lot less controversial than it would have been just a few years ago. Once anathema to environmental leaders, nuclear is now seen as the most reliable way to put carbon-free electrons onto the grid. The Calvert Cliffs nuclear plant in Lusby generates about 40% of all energy in the state — and more than 80% of the state’s clean energy portfolio.
Another nuclear plant of that scale is unlikely to be proposed or built in the state anytime soon. But state leaders are beginning to tout an emerging nuclear technology, small modular reactors, which are just a fraction of the size of standard nuclear plants, as potentially viable. Even Paul G. Pinsky, the director of the Maryland Energy Administration, who recalls protesting against nuclear energy as a young activist in the 1960s and ’70s, sees the technology as promising.
“There’s a timing issue,” he cautioned members of the Senate Committee on Education, Energy and the Environment earlier this month. “We don’t know how fast the new technologies will come online.”
The most optimistic estimates suggest modular nuclear reactors could be developed in six or eight years.
‘A very, very heavy lift’
The Moore administration bill, dubbed the Empowering New Energy Resources and Green Initiatives Toward a Zero-Emission (ENERGIZE) Maryland Act also seeks to boost nuclear energy, along with other clean energy sources. It reaffirms the governor’s goal that the state should eventually produce 100% clean energy — though the legislation does not mention the 2035 timeline that Moore has previously articulated as a target.
The Maryland Energy Administration recently issued a 70-page study on how to boost clean energy production in the state. “This report,” Pinsky told the Economic Matters Committee, “shows it’ll be a very, very heavy lift” to hit the 2035 target.
“What I’m concerned with is being wedded to a timeline, rather than a goal,” Wilson replied.
The highly technical, 44-page administration bill also seeks to rename the state’s longstanding renewable energy portfolio standard (RPS) as the clean energy portfolio standard, and changes certain formulas for percentages of clean production along with incentives and pollution credits for clean energy.
State officials tout progress on electric cars — but acknowledge the Trump ‘elephant in this room’
“I think the ENERGIZE plan firmly grounds Maryland in a goal of achieving 100% clean energy,” said Josh Tulkin, executive director of the Sierra Club Maryland chapter.
Meanwhile, Charkoudian and Sen. Benjamin Brooks (D-Baltimore County) have introduced the Abundant, Affordable Clean Energy Act, which would restructure Maryland’s energy market to increase in-state clean energy production while protecting ratepayers through profit-sharing and cost caps, aiming to make power both more reliable and affordable. That legislation, which is also highly technical and runs 39 pages, is a priority for environmental groups; a hearing has been scheduled in the Economic Matters Committee on Feb. 6.
Like the Moore administration legislation, the Charkoudian-Brooks bill seeks to overhaul the state’s RPS. A study released last week from a national government watchdog group, Public Employees for Environmental Responsibility, suggested that design flaws in the RPS “are undermining the state’s transition to clean electricity and imposing significant costs on Maryland ratepayers.”
The various bills to generate more electricity in the state come as the Moore administration seeks to attract more data centers, and with a major data center campus under construction in Frederick County. While state policymakers and utility regulators also anticipate a gradual transition to more electric vehicles and a reduction in gas usage in buildings, it’s anticipated that the growth in the data center industry will put the greatest strain on the power grid.
Sen. Karen Lewis Young (D-Frederick) and Del. Brian M. Crosby (D-St. Mary’s), the vice chair of the Economic Matters Committee, have introduced legislation that would require the state to study the economic, environmental and energy impacts of data centers in the state. But during a hearing on the bill last week, Crosby conceded that while ideally data center projects would be paused while the study is under way, the legislation would not stop the ongoing development of data centers in the state.
“If we’re going to get into this game and into this business, it’s probably worth it to wait for what the full impact is going to be, but that’s not really reality,” he said. “The train in many ways has left the station and it’s not coming back.”
A separate study on the impact of data centers nationally was released last week by a consortium of Maryland and national environmental groups and research organizations.
The report shows that between 2021-2024, the number of centers in the U.S. roughly doubled from 2,667 to 5,381, and it identified at least 17 fossil fuel-generated power plants nationwide that have delayed their anticipated closures or are at risk of being kept open longer due to the rising electricity demand for data centers.
“Maryland would be wise to learn from other states’ experiences, where too much of the rush to build data centers is being driven by hype, bad policy and inefficient applications of AI and cryptocurrency technology,” said Emily Scarr, senior adviser with the Maryland PIRG Foundation. “To protect our pocketbooks, the natural world and the quality of our lives, Maryland needs a different approach to data centers.”
Judge dismisses climate change lawsuit against oil companies by Annapolis, Anne Arundel County
A proposed high-voltage transmission line from a nuclear power plant in Pennsylvania that would run through Maryland and connect to a data center hub in Northern Virginia has sparked outrage in Baltimore, Carroll and Frederick counties. Several bills have been introduced in the legislature to mitigate the impact of the project — though the ultimate say on the proposal rests with the Public Service Commission.
‘Those who have denied or diminished the science should pick up the tab’
A proliferation of data centers in Maryland would run counter to the state’s ambitious mandates to reduce carbon emissions over the next several years. The state is scrambling for ways to pay for the necessary climate initiatives, which are estimated to cost at least $10 billion.
Last week, the Economic Matters Committee held a hearing on a bill that would allow the state to set up a superfund to make fossil fuel companies pay for environmental degradation in the state over the past several decades. Bill sponsors and advocates envision that the measure could generate enough revenue to cover a good bit of the state’s climate needs.
“We think that it’s only fair that those who have denied or diminished the science should pick up the tab of those who have suffered from the damage,” said the Rev. Ken Phelps of the Maryland Episcopal Public Policy Network, who testified in favor of the measure.
A similar bill stalled last year — though comparable legislation has now become law in New York and Vermont. The U.S. Chamber of Commerce and the American Petroleum Institute have already sued to block the Vermont law.
How many of these energy and climate bills under consideration in Annapolis this session become law is very much an open question. Lawmakers do not have much time to digest some very complex concepts.
“We have a lot of bills coming in but we won’t have a lot of bills coming out,” Wilson predicted.
Charkoudian believes, however, that there will be significant progress.
“I’ve always thought that energy is a multiyear conversation,” she said. “But I think there are decisions that will be made this year that will put us on a path to 100% clean energy.”