Good government groups quantify levels of utility political spending and lobbying as lawmakers in statehouses, including Annapolis, and consumer advocacy groups begin to scrutinize the political activities of utilities across the country more closely. We plan to publish a report attempting to do so. Activities at the Maryland State Capitol.
A new study to be released Thursday by the Maryland PIRG Foundation finds that the state’s monopoly entities have undue influence over state government policy decisions. According to Maryland PIRG, they employ an army of lobbyists in the state legislature and spend millions of dollars in advertising and association membership fees to sway state policy.
The report, called “The Politics of Power,” will help Annapolis lawmakers prevent utility companies from passing on political and lobbying costs to customers, and encourage companies to be more transparent about their financial and financial information. The announcement was made amid the push for legislation to improve gender equality. Governance structure.
The bill, sponsored by Sens. Rorig Chalkudian (D-Montgomery) and Katie Fry Hester (D-Howard, Montgomery), has not yet been voted out of their respective committees. A similar bill from Charkoudian stalled last year.
Maryland’s electric and gas utilities operate as local monopolies and are regulated by the Public Service Commission (PSC), a five-member regulatory agency appointed by the governor. As a result, they automatically occupy a powerful position in the state’s political firmament, the report claims.
“This puts our utilities in the unique position of having the state directly control how much return they can provide to shareholders,” the report said. “This power relationship makes political dealings in public utilities more likely to be corrupt and appear corrupt in the public eye. It is most important that this is done with clear guidelines and strong transparency in the decision-making and rate-setting processes.”
Maryland PIRG acknowledges that the nation’s energy transition away from fossil fuels and toward more electrification in the construction and transportation sectors is putting new pressure on electric utilities. But it will also put pressure on lawmakers and regulators like the PSC, which create policies that affect utilities.
Overall, 71 lobbyists will be registered to represent utility interests in 2023, led by Baltimore Gas & Electric and Pepco, which each had 22 lobbyists last year, according to the report. lobbyists were employed. The state’s two largest electric utilities, BGE and Pepco, are both owned by Chicago-based energy giant Exelon.
Washington Gas, the state’s next largest utility, paid eight state legislative lobbyists in 2023.
A Maryland PIRG study found that electric utilities lobbied lawmakers on at least 94 bills that were being considered during the 2023 General Assembly session, and 11 gas and electric companies lobbied lawmakers on at least 94 bills that were being considered during the 2023 General Assembly session, and 11 gas and electric companies lobbied lawmakers on at least 94 bills that were being considered during the 2023 General Assembly session. Through October 31, 2017, the company spent $2,204,231 on lobbying activities. Five of the utilities spent six figures on lobbying: Pepco ($647,813), BGE ($443,983), Washington Gas ($359,505), and Choptank Electric Cooperative ($257,694). $236,680) and First Energy, Potomac Edison’s parent company, $236,680.
Maryland’s PIRG report found that the state’s five electric utilities spent a total of $4,214,533 on advertising in 2022, led by BGE, which spent $1,744,923. Pepco spent $1,404,829 and Delmarva Power, another Exelon company, $586,529, while Southern Maryland Electric Cooperative cost him $434,495 and Columbia Gas $43,707.
Industry associations can also burnish a utility’s image and promote its plans. According to the report, BGE spent $830,075 on industry association dues in 2022, while Pepco spent $500,000.
Despite releasing all this data, Maryland PIRG said utilities play an important role in the state and deserve to be on the agenda when lawmakers create policy. But they also gave a warning.
“We need utilities to focus on their core mission of providing reliable power to the public good,” the good government group wrote. “As our decision-makers discuss public policy that affects our utilities, we want our utilities to have a seat at the table and to make sure they have the expertise and knowledge they need to know about how best to meet their Charter obligations. Opinions must be shared. However, in addition to providing such opinions, investor-owned utilities may not engage in lobbying or other activities intended to influence policymakers or public opinion. , and may be engaged in ways that contribute to the bottom line, sometimes at the expense of the public interest. Navigating these dynamics is not always easy for decision-makers and the public.”
With all of this as a backdrop, the Chalkoudian-Hester bill would require Maryland electric utilities regulated by the Public Service Commission to recover through fees costs associated with lobbying and political activities, as defined in the bill. It is prohibited. The bill would also require each electric utility with 75,000 or more customers in the state to submit a report to the PSC by January 1 of each year that includes various financial information. There is. The bill would require each utility company with a representative on PJM’s board of directors to annually report information to the PSC, including information related to board votes. .
“What happens and what doesn’t happen with PJM will be critical to our clean energy transition, to ratepayers, and to determining how much of the grid we need to build.” ,” Charkudian told his colleagues on the House Economic Affairs Committee during a hearing on the bill. last month.
Charkudian also said Maryland may also be looking to push for greater transparency in public utilities, with similar bills in fellow PJM states Illinois, Pennsylvania, West Virginia and Virginia. was said to be under consideration.
However, utility companies testified against the bill, pointing out that they are highly regulated and their activities are closely monitored by the Public Service Commission.
Anne Clase, a lobbyist for Pepco and Delmarva Power, said the bill would “place burdens on Maryland’s electric utilities that are not imposed on other industries.”
Nevertheless, the political and lobbying pressure that utilities exert on policymakers can have an outsized impact, said Emily Scarr, executive director of the Maryland PIRG Foundation.
“Decisions made by legislators and regulators to achieve Maryland’s ambitious climate change goals will have a real impact on the health and financial security of Marylanders,” she said.
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