Baltimore Maryland Electricity

Baltimore Maryland has recently been added to a list of cities in the US who has seen great success when it comes to deregulating the electricity market.

All cities in states in the US at one time were under natural monopolies when it came to procuring electricity for their home or business.

The state of Texas was the first state in the US to have quick success in the deregulating of their electricity market and this has since spread to the state of Maryland and Pennsylvania.

California was an example of a state where politics and corporate business collided in a state of corruption that ended up suspending electricity deregulation but even in CA deregulation has come back.

In Baltimore Maryland 20 percent of all residential customers of Baltimore Gas and Electric Company have switched to an alternate electricity supplier.  40 percent of all commercial and industrial businesses have switched to a competing Baltimore Maryland electricity supplier so obviously something is persuading people to switch.

Ultimately what causes large commercial and industrial energy customers to switch to a competing electric utility company is price. Deregulating the Maryland electricity market has assisted in causing prices to drop. Obviously a lower price is what people intend to happen when more companies come in offering efficiencies and niche choices previously unavailable through the inefficient nature of a government regulated bureaucratic energy utility.

There are still slow processes and red tape involved in a deregulated electric utility market but competition is encouraged and unique and innovative rate plans are encouraged.

The large electric utilities have one small advantage over the many small time Baltimore MD electricity companies that are now in the state and that is in natural monopoly. Large electric utilities own raw fuel resources as well as sell electricity retail.

Through years of both owning fuel commodities and selling electricity power the natural monopolies in place allow for less risk involved when selling in the small niche of retail electricity.

Small electric companies in Baltimore compete and manage their portion of risk in the retail energy markets by entering into sleeve agreements and hedging contracts with companies that own generation. 

Not all retail electricity companies manage risk properly and so providers in Baltimore will continue to come and go while a few will make a name for themselves and compete quite well against large providers like BG&E Co.

last time modified: Sept. 14, 2011, 6:09 p.m.