With the 2026 Legislative Session approaching, MACo is profiling major issues, including energy, that stand to gather significant attention.
The 2025 legislative session will go down in history as the “Session of Energy,” with the General Assembly passing a historic number of energy bills. A major focus for counties was HB1036/SB931, the Renewable Energy Certainty Act, which restored some local authority and provided predictability for the development of solar. For 2026, energy will again be a primary focus, although current indications point to a low likelihood of further county preemption. As in 2025, the top priority in 2026 will be expanding Maryland’s domestic energy production and expanding transmission infrastructure. Maryland has struggled to meet its ambitious renewable energy targets, even as electrification and economic policies drive up demand.
According to the 2026 Issue Papers,
Forecasted energy resource adequacy issues for the electric grid serving Maryland and the surrounding region have contributed to higher energy prices and the anticipated need for additional transmission and generation assets. Recent legislation has established multiple incentives for new in-State energy resources over the next several years, including dispatchable generation, energy storage, and nuclear. The Public Service Commission is also studying additional procurement models for generation assets, including partnerships between electric companies and electricity suppliers. Statewide net metering capacity continues to increase toward the overall capacity limit.
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PJM Capacity Auction
… Last year, PJM’s capacity auction for the 2025-26 electricity delivery year resulted in electric capacity prices soaring from $28.92/megawatt-day in the 2024-25 delivery year to $269.92/megawatt-day for 2025-26. For customers living in the Baltimore Gas and Electric zone in the State, prices rose even higher to $466.35/megawatt-day. Furthermore, PJM held another capacity auction for the 2026-27 delivery year that resulted in capacity prices of $329.17/megawatt-day, a record high for the second straight year. After multiple states, including Maryland, raised concerns over the rising capacity costs, PJM imposed price caps on the subsequent capacity auctions. PJM noted that if not for the price caps that it agreed to set on the capacity market, prices would have been 18% higher. The price caps on the capacity auction will end after the 2027-28 delivery year. PJM has based its forecasts on the potential growth of data centers in the PJM region, although critics say that the PJM forecasts are inflated.
Transmission Line Siting
PJM has forecasted resource adequacy issues in its territory, particularly in central Maryland, due to added capacity needs from data centers and the retirement of coal-fired plants and has solicited solutions for meeting those needs. In order to protect against those forecasted resource adequacy issues, PJM approved a proposal to build an additional transmission line from a nuclear plant in Pennsylvania through Baltimore, Carroll, and Frederick counties. The proposed transmission line would terminate at a substation in southern Frederick County, just north of the Virginia state line. The proposal is commonly known as the Maryland Piedmont Reliability Project.
Any project in the State attempting to build high-voltage transmission lines must receive a certificate of public convenience and necessity (CPCN) from the Public Service Commission (PSC). Generally, PSC must take final action on a CPCN application only after due consideration of (1) recommendations of the governing body of each county or municipality in which any portion of the project is proposed to be located; (2) various aspects of the State infrastructure, economy, and environment; and (3) the project’s effect on climate change. Additional requirements specifically for transmission lines include due consideration by PSC of the need to meet existing and future demand for electric service and, for new lines, alternative routes considered by the applicant.
In granting a CPCN, PSC’s authority preempts the zoning and siting requirements of the municipality or county. The issuance of a CPCN for a transmission line also allows the person to exercise eminent domain on any property or right necessary for its construction or maintenance, in accordance with Title 12 of the Real Property Article. Project developers are still required to obtain local permits once the CPCN is issued. The proposed Maryland Piedmont Reliability Project faces significant local opposition; analysis, testimony, and public hearings are scheduled to occur in 2026. PSC has determined that it will not rule on the project until 2027.
As with the Chesapeake Bay, Washington will play a key role in shaping Maryland’s energy outlook. The current gridlock in Congress and changes in administration priorities are constraining Maryland’s progress toward fully building out a more carbon-neutral grid.
Executive Orders
On January 20, 2025, President Trump issued Executive Order 14154, Unleashing American Energy, that, among other things (1) revoked 12 energy and climate change executive orders; (2) eliminated the “electric vehicle mandate;” (3) canceled the American Climate Corps; (4) paused the disbursement of funds appropriated through the Inflation Reduction Act (IRA) and Infrastructure Investment and Jobs Act; and (5) required the Council on Environmental Quality to rescind existing National Environmental Policy Act regulations. Also on January 20, 2025, President Trump issued Executive Order 14162, Putting America First in International Environmental Agreements, that (1) directed the United States to withdraw from the Paris Climate Agreement and similar commitments under the United Nations Framework Convention on Climate Change and (2) revoked and rescinded the U.S. International Climate Finance Plan.
One Big Beautiful Bill Act
The One Big Beautiful Bill Act (OBBBA) was signed into law by President Trump on July 4, 2025. The OBBBA made sweeping changes to tax and spending policies and cut funding for, among other things, programs and initiatives that support clean energy, clean vehicles, and climate change adaptation and mitigation.
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Department of Energy Grant Cancellations
On October 2, 2025, the U.S. Department of Energy announced the termination of more than 321 grant awards supporting 223 clean energy projects, totaling approximately $7.6 billion across 16 states, including Maryland. Canceled awards for projects in Maryland total nearly $88 million and were awarded to, among others, Baltimore Gas & Electric Company; firms in Baltimore, Columbia and Anne Arundel counties; University of Maryland research teams; and the Resilience Authority of Annapolis and Anne Arundel County.