ANNAPOLIS, Md. - Maryland officials are warning that massive electricity demands from data centers, many tied to artificial intelligence development outside the state, could end up costing Maryland ratepayers more on their monthly power bills.
The warning comes from a recent complaint filed by the Maryland Office of People's Counsel against regional grid operator PJM Interconnection with the Federal Energy Regulatory Commission. The complaint, filed on May 7, argues Maryland customers, including those on the Eastern Shore, are being unfairly forced to shoulder billions of dollars in transmission upgrade costs linked largely to booming data center growth in places like Northern Virginia, Ohio, Illinois, and Pennsylvania.
For residents on the Eastern Shore, that could eventually affect customers served by utilities like Delmarva Power and Choptank Electric Cooperative, both of which operate within PJM’s regional electric grid.
According to the complaint, PJM approved more than $22 billion in transmission projects over the last three years, with Maryland customers potentially responsible for roughly $2 billion of those costs. The Office of People’s Counsel estimates the impact could add about $1.6 billion to Maryland electric bills over the next decade alone.
State officials argue Maryland is not seeing the same explosive growth in data centers as neighboring Virginia, which the filing describes as “the largest data center market in the world.” The complaint says roughly 30 gigawatts of projected load growth across PJM by 2030 is tied to data centers.
The filing claims Maryland customers are being charged for infrastructure upgrades they neither caused nor actually benefit from. Instead, officials argue, the costs should be assigned directly to the areas where the data centers are being built or to the companies developing them.
“Without FERC action, Maryland customers face paying billions for transmission infrastructure that PJM is advancing to benefit data centers,” Maryland People’s Counsel David Lapp said in a statement announcing the complaint.
The complaint points to rapidly increasing electricity demand tied to AI operations and large-scale cloud computing centers. It says some utilities in Virginia alone have received tens of thousands of megawatts in new data center power requests, far exceeding the current peak demand of some regions.
While much of the current concern focuses on customers using central Maryland utilities like Baltimore Gas and Electric and Pepco who would see the greatest spike in rates, Eastern Shore customers could also feel the impact due to PJM spreading portions of transmission costs across its entire regional system, which includes Maryland, Delaware, and parts of Virginia. Ratepayers served by Delmarva Power and Choptank Electric could ultimately pay part of the cost through future transmission charges built into electric bills, according to the complaint.
In their filing with the Federal Energy Regulatory Commission, officials with the Office of Peoples’ Counsel cite a ratepayer bill change projection showing the following impacts for local ratepayers over the next 10 years:
Delmarva Power
-Residential: about $205 per average residential customer over 10 years, or about $20 a year
-Commercial: about $507 per average commercial customer over 10 years
-Industrial: about $7,670 per average industrial customer over 10 years
-Total across customer classes: about $62.7 million
Choptank Electric Cooperative
-Residential: about $508 per average residential customer over 10 years, or about $50 a year
-Commercial: about $1,493 per average commercial customer over 10 years
-Industrial: about $40,481 per average industrial customer over 10 years
-Total across customer classes: about $2.74 million
In a statement to WBOC, Choptank Electric Cooperative underscored that it does not own or operate any part of the transmission system, though their members are impacted by transmission system costs.
“As these discussions continue, Choptank believes it is important that costs are allocated fairly and that existing cooperative members are not disproportionately impacted by new load growth,” a Choptank spokesperson said. “While Choptank cannot independently prevent or control regional transmission cost decisions made through PJM, we actively advocate on behalf of our members through industry and regulatory processes focused on affordability and reliability.”
The Office of People's Counsel’s filing also raises concerns about what it calls “phantom” data center demand. According to the complaint, some developers submit requests in multiple states before deciding where to actually build, creating uncertainty about whether all proposed projects will materialize. Even so, utilities may still move forward with expensive grid upgrades that ratepayers would help fund for decades.
The Maryland Office of People’s Counsel is asking federal regulators to require PJM to change how it allocates those transmission costs. The case is now before the Federal Energy Regulatory Commission.
WBOC has reached out to Delmarva Power for a statement on this story. This article will be updated.
