House Passes Bill to Stop Utilities from Charging Customers for Excessive Executive Salaries

The House of Delegates passed HB1, a measure that would prohibit BGE and other investor-owned utilities from passing along the high costs of executive salaries to Maryland ratepayers. The bill would also add new restrictions on charging customers for events and advertising. The bill, which was sponsored by Del. Brian Crosby, passed with a bipartisan vote of 97-30, would prohibit utilities from charging customers the cost of salaries that are higher than 110% of the annual salary of the Chair of the Maryland Public Service Commission.

The debate over HB 1 comes as energy costs continue to rise – along with skyrocketing utility profits. Since BGE was acquired by Exelon in 2012, gas delivery charges have more than tripled, about 3 times the rate of inflation. Electric delivery rates for BGE and Pepco have risen faster than inflation as well, with BGE and PEPCO electric delivery rates doubling since 2010. BGE profits were consistently under $150 million until the utility was bought by Exelon in 2012, since then, profits have increased to $527 million in 2024 and are on pace to be even higher in 2025.
Pepco profits were $205 million in 2018, the year after the company’s merger with Exelon, and have already nearly doubled to $390 million in 2024.

Next the bill will head to the Senate. The Senate held a hearing on the cross-file of the bill, SB2, on February 5th in the Education, Energy, and the Environment Committee.

In response to the vote, advocates made the following statements: “Ratepayers should not be forced to pay for compensation over a quarter of a million dollars when they are struggling to afford their electric bill and essentials such as medicine and groceries,” said Jennifer Bevan-Dangel, Deputy Director of Economic Action Maryland Fund. “This legislation builds off last year’s work to eliminate expenses from utility bills that do not benefit ratepayers, including the costs of private jets.”

“In the face of rapidly rising utility bills and skyrocketing utility profits, we applaud House leaders for pushing back on excessive utility charges and wasteful spending with HB1. The state is right to limit how much state-granted monopolies can charge their customers for executive salaries,” said Emily Scarr, Senior Advisor for Maryland PIRG. “We urge Governor Moore, the General Assembly and state regulators to continue to adopt new strategies to ensure customers are getting better value from their utilities.”

“We are grateful to Speaker Peña-Melnyk and the House of Delegates for leading the charge on affordability in Maryland. At a time when families are struggling through a cost-of-living crisis and skyrocketing utility bills are pushing Marylanders past the breaking point, ratepayer dollars should not be lining the pockets of corporate executives,” explained Erica Puentes, Legislative Coordinator at Progressive Maryland. “This action sends a clear message: People come before profits. Now it’s time for the Senate to step up and follow the House’s lead.”

“Excessive utility spending and profits have made it unaffordable for many Marylanders to live comfortably in their homes. Instead of charging customers for excessive executive salaries, our utilities should be helping Marylanders move to healthier and more efficient home heating” said Brittany Baker, Maryland Director for Chesapeake Climate Action Network.

“HB 1 will help protect ratepayers from utility expenses that do not directly improve service, reliability, or affordability,” said Rebecca Rehr, Director of Climate Policy and Justice at the Maryland League of Conservation Voters. “This bill places reasonable limits on the costs that investor-owned electric and gas utilities may recover through customer rates, particularly around executive compensation and discretionary corporate spending.”

 

“Marylanders are struggling with rising energy bills. Folks are tightening their belts and finding ways to save energy and save money. HB1 makes sure our utilities are doing the same thing,” said Josh Tulkin, Director of the Maryland Sierra Club. “Marylanders don’t want to see multi-million dollar salaries and bonuses while they struggle with bills.”