Maryland Small Business Electricity: How to Compare Supplier Offers

If you run a business in Maryland, you have been watching your electricity bill climb for about two years, and you have probably gotten a phone call or a letter promising to fix it. Some of those offers are genuinely good. A meaningful number of them are worse than doing nothing. The difference is not obvious from the headline rate, which is exactly why the bad ones keep working.

This is a guide to reading a Maryland supplier offer the way a procurement person reads it: what you are actually buying, what the market is doing, what other Maryland businesses have actually paid, and which six contract terms decide whether the number on the page is the number you'll pay.

What you are actually buying

Maryland deregulated its electricity market in 1999, which split your bill into two halves that behave completely differently (¹).

The first half is delivery — the poles, wires, substations, meter reading, and outage crews. That is your utility, and you cannot shop it. Maryland has four major investor-owned utilities: Baltimore Gas and Electric across most of central Maryland, Pepco in Montgomery and Prince George's counties, Delmarva Power on the Eastern Shore, and Potomac Edison in Frederick, Washington, and Allegany counties, plus two cooperatives — Southern Maryland Electric Cooperative and Choptank (¹). Whichever one serves your address serves it forever. Delivery rates are set by the Maryland Public Service Commission, and a competitive supplier cannot change them by a penny.

The second half is supply — the actual electricity. That is the part you can shop. If you do nothing, your utility buys it for you and passes it through at cost under Standard Offer Service, or SOS. If you sign with a licensed competitive supplier, that supplier's price replaces the SOS line on your bill. Everything else stays the same: same wires, same outage number, same utility bill, same crews when a tree comes down.

That distinction matters for two reasons. First, when a salesperson quotes you "8 cents," they mean 8 cents on the supply portion of your bill, not the whole thing — your delivery charges and the other line items your utility bills are unaffected. Second, when someone implies your lights are more reliable with a particular supplier, they are describing something that cannot happen. Reliability is a wires question, and the wires do not know who you buy from.

Maryland businesses have taken to this market. In 2024, energy-only providers — the competitive suppliers — sold 27.1 million megawatt-hours in Maryland out of 59.0 million megawatt-hours of total retail sales, which is about 46% of all the electricity sold in the state, and the eighth-largest competitive volume in the country (²). That figure spans every customer class, but it establishes the point: nearly half of Maryland's electricity already moves through competitive supply. This is not a fringe market.

Where Maryland prices stand, and why they moved

The context for every offer you'll see this year is a sharp, recent run-up.

In May 2025, Maryland's average commercial electricity price was 13.39 cents per kilowatt-hour. One year later, in May 2026, it was 16.40 cents — a 22% increase in twelve months (³). Over the same window, the national commercial average moved from 12.93 to 13.54 cents. Maryland went from roughly the national average to about 21% above it in a single year.

The longer view confirms this is new. For all of 2024, Maryland's average commercial price was 12.96 cents against a U.S. average of 12.75 cents — essentially in line (⁴). The gap opened recently and opened fast.

The main driver sits upstream of any supplier. Maryland is inside PJM Interconnection, the regional grid operator for 13 states and D.C., and PJM runs an annual capacity auction that pays generators to promise availability years in advance. In December 2025, that auction cleared at $333.44 per megawatt-day — the price cap, and a record high for the third consecutive auction (⁵). PJM estimated that without a temporary cap negotiated with Pennsylvania's governor, the price would have landed near $530 per megawatt-day, roughly 60% higher. The auction also fell about 6,625 MW short of PJM's reserve margin target, and PJM's demand forecast rose by 5,250 MW — an increase driven almost entirely by data centers.

Two caveats worth holding onto. Capacity is a real cost but a modest slice: PJM's own market services executive said ratepayers would see little bill change from that particular auction, and capacity costs make up a relatively small part of electric bills (⁵). And the price cap was temporary — PJM's following base auction was not scheduled to include one, though some industry observers expected a cap to be reinstated.

The unresolved question is who pays for what comes next. In May 2026, PJM's board moved a planned "backstop" reliability auction up to September from March, and used the announcement to press states to act fast: "After PJM runs the Backstop procurement, if states have not established frameworks to appropriately allocate costs to new data center loads, it is unclear to which customers those costs would be assigned" (⁶). Jefferies analysts pegged the revised target at roughly 9 GW and said it remains unclear how those costs could be assigned only to hyperscalers rather than existing ratepayers.

Translated into a decision: there is real upside risk in the supply market over the next few years, and that argues for locking a term rather than floating — provided the locked price is a good one. Which brings us to the part almost nobody checks.

What Maryland businesses actually paid their suppliers

Here is the number that should change how you shop.

The EIA collects revenue and sales data from every retail power marketer serving commercial customers in every state. For Maryland in 2024, the implied average supply price across competitive suppliers ranged from 6.64 cents to 21.68 cents per kilowatt-hour (⁷). Same state, same year, same grid, same wires. A spread of more than three to one.

These are supply-only figures — total supply revenue divided by total supply sales, with delivery billed separately by the utility — so they are not comparable to your all-in bill. But they are directly comparable to each other, and the pattern in them is stark.

At the low end sit the suppliers serving large accounts. MidAmerican Energy Services averaged 6.64 cents across 2,096 Maryland commercial customers. Calpine Energy Solutions averaged 6.71 cents across just 41 customers who took 825,079 MWh between them — an average of roughly 20,000 MWh per account. WGL Energy Services, the largest by customer volume, averaged 7.55 cents across 16,191 accounts, and Constellation NewEnergy averaged 7.92 cents across 37,677 accounts (⁷).

At the high end sit the suppliers serving very small accounts. Clearview Electric averaged 21.68 cents across 14 customers. Atlantic Energy averaged 20.53 cents across 297 customers. Spark Energy averaged 20.30 cents across 42 customers. American Power & Gas averaged 16.33 cents across 1,192 customers (⁷).

Run the arithmetic on account size and the pattern is unmistakable. Clearview's Maryland commercial customers averaged about 8 MWh a year each. Spark's averaged about 19 MWh. Atlantic Energy's averaged about 32 MWh. Meanwhile WGL's averaged about 331 MWh and Constellation's about 145 MWh. The suppliers charging two and three times the market are, almost without exception, the ones selling to the smallest businesses.

One company illustrates the whole dynamic. Direct Energy operates two Maryland entities. Direct Energy Business averaged 8.86 cents across 1,774 accounts averaging roughly 298 MWh each. Direct Energy Services averaged 10.48 cents across 3,165 accounts averaging roughly 19 MWh each (⁷). Same brand, same state, same year — a 1.6-cent gap that tracks nothing but customer size.

None of this means small businesses are being cheated as a rule. Small accounts genuinely cost more to serve: acquisition costs are spread over fewer kilowatt-hours, and unpredictable usage is more expensive to hedge. But a three-to-one spread is far larger than those costs justify, and it tells you something practical. If you are a small commercial account in Maryland, the default outcome of answering a cold call is a rate in the upper half of that range. Getting into the lower half takes deliberate effort. It is entirely achievable — Constellation and WGL were serving tens of thousands of Maryland commercial accounts in the sevens — but it does not happen passively.

The six terms that decide whether an offer is good

Once you have competing quotes, most of the risk lives in six places. Work through them in order.

1. Is it fixed, indexed, or a teaser? A fixed rate holds for the whole term. An indexed rate floats with wholesale prices, which means you are carrying the market risk that the PJM situation above just made larger. A teaser is the dangerous one: a low fixed rate for a month or two, then automatic conversion to the supplier's discretionary variable rate. Ask directly what the rate becomes after the promotional period and what caps it. If nobody will give you a specific number, there is no cap.

2. What exactly does the rate include? A quote can exclude capacity, transmission, ancillary services, line losses, or renewable portfolio standard compliance and pass them through separately. A 7.9-cent quote with three pass-throughs can easily beat a 9.4-cent all-in quote — or lose to it badly. Ask each supplier for the same thing: an all-in supply price with every component either included or itemized in writing, so you're comparing the same shape of deal.

3. How long is the term, and does the price hold if your usage changes? Many commercial contracts include bandwidth or swing clauses that reprice you if annual consumption drifts beyond a stated tolerance around the forecast. That is fine for a stable office. It is a real hazard if you're adding a second shift, opening a location, or installing refrigeration or EV chargers. Tell the supplier your growth plans and get the bandwidth tolerance in writing.

4. What is the early termination fee? The FTC's guidance on utility offers is blunt and applies cleanly here: get any offer to lower your utility bills in writing before you accept, consider how long the offer is valid, and ask about the length of the contract and whether it involves early termination fees (⁸). Commercial ETFs are frequently structured as the remaining contract volume times a mark-to-market difference, which is uncapped and can be large.

5. What happens at the end? This is where most money is quietly lost. Evergreen clauses roll you onto a month-to-month variable rate the day the term expires, and that rate is set at the supplier's discretion. Find the renewal language, calendar the expiration date ninety days out, and put a name on who owns the renewal.

6. Who is actually on the other side? Maryland law requires licensed electricity suppliers — a definition that includes brokers — to post readily understandable information about their services and rates for small commercial and residential customers on their websites (⁹). If a company soliciting you has no such posting, that is a signal. It also matters whether you are talking to a supplier, who sells you power, or a broker, who is paid a commission — often embedded in your rate — to place you with one. Brokers can be genuinely useful. Ask how they are compensated and whether the fee is inside your quoted price.

The FTC's other advice transfers directly: resist high-pressure door-to-door sales, and treat urgency as a red flag rather than an opportunity (⁸). Nothing about a legitimate energy contract expires this afternoon.

Why your quote will not match the state average

The 16.40-cent statewide commercial average is a useful benchmark and a bad prediction of your specific price. Three things move your quote away from it.

Load factor. This is the single most important number in commercial supply and the one most business owners have never heard of. It's your average demand divided by your peak demand — in plain terms, how steady your consumption is. A data-processing office running flat around the clock is cheap to serve because the supplier can hedge it with baseload power. A restaurant with a dinner-service spike, or a machine shop where the whole floor starts at 7 a.m., is expensive to serve, because that peak has to be covered with the most costly hours on the grid. Two businesses on the same street using identical annual kilowatt-hours can be quoted meaningfully different rates on load factor alone.

Capacity and transmission charges. Capacity — the cost of paying generators to be available, set in the PJM auctions described above — is priced into your supply rate based on your own account's demand history, not on statewide averages. Ask each supplier how it is calculating your capacity and transmission components and whether they are fixed into your rate or passed through. Cutting usage during the hottest afternoons is one of the few moves that can lower what you pay per kilowatt-hour rather than just how many you buy, and unlike switching suppliers, the benefit persists across contracts.

Utility territory and rate class. BGE, Pepco, Delmarva, and Potomac Edison have different delivery rates and different default supply rates, and the rate class your meter sits in determines whether you're charged for demand in kilowatts as well as energy in kilowatt-hours. Compare offers within your own territory and rate class only.

The reliable move is to pull twelve months of interval data from your utility before you shop, then hand the same dataset to every supplier you're soliciting. Suppliers price from your actual shape. Give them all the same shape and their quotes become genuinely comparable — which is the entire point.

Green power offers and what a REC actually buys

Renewable offers are common in Maryland, and they are frequently misunderstood.

Maryland's Renewable Portfolio Standard requires 50% renewables by 2030, raised from an earlier 25%-by-2020 target (¹). Compliance costs are already embedded in every supply price you're quoted, renewable-branded or not.

A voluntary green offer goes further by retiring Renewable Energy Certificates on your behalf. A REC is issued when one megawatt-hour is generated and delivered to the grid from a renewable resource, and it represents the property rights to the non-power attributes of that generation (¹⁰). Because the grid is shared and electrons are not labeled, RECs are the instrument electricity consumers must use to substantiate renewable electricity use claims. The EPA is also explicit that RECs are not carbon offsets: an offset represents a metric ton of emissions avoided, a REC represents the attributes of a megawatt-hour of renewable generation.

Maryland PSC staff drafting rules to implement the state's 2024 green power law proposed making suppliers say this out loud to residential customers, in language worth reading slowly: "The purchase of a REC does not indicate that renewable electricity itself has been purchased by the entity that purchased the REC" (¹¹). The economics are identical for a commercial account.

One asymmetry matters for business shoppers. Maryland's 2024 SB 1 restricted how green power can be priced to residential customers, but the relevant provision excludes commercial customers (¹¹). Residential green-power pricing protections do not extend to your business account. If a green premium is being quoted, ask what it is in cents per kilowatt-hour, what fuel type and vintage the RECs are, and where they were generated. A vague "100% renewable" label with an unstated premium is a pricing decision disguised as an environmental one.

Switching, renewing, and the traps in between

Switching is administratively boring, which is the good news. You sign, your supplier notifies your utility, and the change takes effect on an upcoming billing cycle. Your utility keeps delivering power and keeps handling outages. Ask your prospective supplier whether you will get one combined bill or two, since practice varies.

You can also go back to Standard Offer Service, and you should stop treating it as the thing you're escaping. Given the range in the EIA data — competitive suppliers serving Maryland's smallest commercial accounts at 16 to 21 cents in a year when the largest accounts were paying under 8 (⁷) — the utility default was very likely the better deal for a lot of those small customers. Treat SOS as a live option in every comparison.

Three traps recur:

Slamming and account numbers. Your utility account number is the key to switching your service. Do not hand it to anyone you did not seek out, and do not photograph your bill for a stranger at your door. If a supplier you don't recognize appears on your bill, call your utility first, then report it.

The renewal cliff. A three-year contract signed in a soft market can expire into a hard one. The supplier knows your expiration date; you should too. Start soliciting quotes three to six months out, and make the incumbent bid against outsiders rather than simply presenting you a renewal.

Contracts that were never really read. Get the full terms, not the one-page summary. If nobody at your business has the time to read a commercial supply contract carefully, that is a decision to accept whatever it says.

If a supplier's marketing was misleading, take it to the Maryland Public Service Commission, which sets the disclosure rules retail energy suppliers operate under (⁹), and report deceptive practices to the FTC at ReportFraud.ftc.gov (⁸). Complaint volume is what drives enforcement.

A shopping sequence that works

Do these in order. The order matters more than the effort.

1. Pull your last twelve months of usage and demand data from your utility. Most provide interval data on request. Without it, every quote you get is a guess dressed up as a price.
2. Find your current SOS or supply rate on your bill and write it down. That is your benchmark. Every offer gets measured against it.
3. Solicit at least three quotes on identical terms — same start date, same term length, same all-in structure — and give each supplier the same usage data. If a broker is involved, ask in writing how they are paid.
4. Compare total cost, not rate. Multiply each quoted rate by your actual annual kilowatt-hours, add any fixed monthly charges, and add the expected value of pass-throughs. The lowest rate is regularly not the lowest bill.
5. Read the six terms above on the offer you like best, then read them again on the runner-up. Differences in ETF structure and bandwidth clauses have flipped more decisions than a tenth of a cent ever has.
6. Calendar the expiration ninety days out the day you sign, with an owner's name attached.

And then do the thing that outlasts any contract. Supply is the part of your bill you can shop; usage is the part you can control, and it never renews or expires. Utilities frequently offer free or low-cost energy assessments, and state and local energy offices can point you to rebates and incentive programs (⁸). Maryland has run utility-administered efficiency programs since the EmPOWER Maryland Energy Efficiency Act of 2008, and the state's incentive landscape is well documented (¹). For buildings, EPA's ENERGY STAR certification requires a score of 75 or higher on a 1–100 scale, meaning the building performs better than at least 75% of comparable buildings nationwide, verified annually by a licensed professional engineer or registered architect (¹²). Even scoring your building without pursuing certification tells you whether your problem is your rate or your envelope.

The market Maryland built in 1999 does work — but it rewards attention and quietly taxes inattention. The EIA data makes that plain: in the same state and the same year, some commercial customers paid under 7 cents for supply and others paid over 21. Almost none of that gap was luck. Most of it was whether somebody sat down with twelve months of usage data and three competing quotes, or whether somebody took a phone call.