Exelon Seeks to Build Maryland Power Plant, Challenging Decades of Utility Deregulation

Exelon Corp., owner of three electric utilities in Maryland, plans to push for legislative approval next year to build and operate a power plant in the state, marking a potential reversal of a 26-year-old utility deregulation policy. The 1999 policy forced utilities operating power lines and transmission infrastructure to exit the power generation business, but Exelon appears poised to challenge this framework as Maryland customers face rising electricity costs.

The company's proposal comes at a time when electric customers across Maryland and the region are experiencing price pressures driven by both increasing demand and rising power distribution costs charged by utilities. Exelon officials argue that building new generation capacity would help stabilize electricity supply and ultimately control costs for consumers. Valencia McClure, a senior vice president of governmental, regulatory and external affairs at Exelon, stated that additional generation represents a guaranteed method to increase electricity supply and bring costs under control.

Critics of the proposal raise concerns about cost recovery mechanisms, noting that unlike independent power generators currently operating in Maryland, Exelon would potentially be able to recover generation costs directly from ratepayers. However, Exelon emphasizes that any cost recovery would require approval from Maryland regulators through established regulatory processes. The company maintains that regulatory oversight would ensure proper control over how, where, and when generation infrastructure investments are made.

The legislative battle expected in Annapolis next year represents a significant test of Maryland's energy policy framework. Success for Exelon would fundamentally alter the state's approach to utility regulation that has been in place for more than two decades. The outcome could influence how other states approach utility deregulation policies amid changing energy markets and consumer price pressures. The full details of the proposal and legislative strategy are expected to emerge as the 2024 legislative session approaches. For additional coverage of this developing story, visit https://citybiz.com.