Maryland PSC demands new energy plans to modernize grid and cut costs under DRIVE Act

Summary

The Maryland Public Service Commission (PSC) has issued an order demanding the state's major electric utilities file comprehensive energy plans under the Developing Resources and Infrastructure for Vehicle Electrification (DRIVE) Act.

These plans must specifically detail how the utilities intend to modernize the electric grid to safely and reliably integrate a rapidly growing number of electric vehicles (EVs) and distributed energy resources.

Crucially, the PSC requires utilities to prove that these grid modernization investments will result in reduced energy costs for consumers and ensure the costs of integrating EVs do not disproportionately burden non-EV owners. The order signals the PSC's commitment to strategic planning that prioritizes long-term efficiency, grid resiliency, and substantial customer benefits over routine infrastructure requests.

Background Context

The Maryland DRIVE Act is part of a larger legislative effort to prepare the state's infrastructure for the transition to electrified transportation and combat climate change. Integrating a high volume of EVs presents a significant challenge to the existing electric grid, which was not designed to handle large, unpredictable demands from vehicle charging, potentially causing localized overloads and system instability.

Grid modernization, often referred to as building a "Smart Grid," involves implementing advanced technology like smart meters, automated controls, and sophisticated data analytics to better manage two-way power flow and optimize load distribution. Proactive planning, as demanded by the PSC, is essential to mitigate peak demand spikes, integrate renewable energy sources efficiently, and avoid expensive, reactive upgrades.

This coordinated approach aims to ensure the benefits of electrification are realized reliably and cost-effectively for all Maryland residents.

Maryland Public Service Commission Actions

Maryland’s PSC issued Order No. 91917 in Case No. 9761 (Oct. 21, 2025), accepting investor-owned utilities’ opt-in time-of-use (TOU) tariffs with modifications and rejecting their proposed Electric Distribution System Support Services (EDSSS) pilots (VPP/V2G) “as filed,” directing re-submittals within 90 days and emphasizing clear metrics, data exchange, equity/LMI participation, and locational value. Under the 2024 DRIVE Act (PUA §7-1001 et seq.), utilities must deploy enhanced TOU rates (with off-peak price discounts and 2028 enrollment targets) and propose EDSSS pilots to compensate DERs; the Act caps EDSSS peak-load reduction at up to 2% of each utility’s highest coincident peak. For energy storage specifically, the PSC continues to run the Maryland Energy Storage Program in Case No. 9715 and the associated RM85 rulemaking, which establish approval/waiver processes and statewide participation/safety requirements for front-of-the-meter storage (≥20 MWh projects undergo coordinated state-agency review unless exempted). The Commission has also opened Case No. 9778 to develop Virtual Power Plant policy (including Order 91603 on FERC 2222 alignment), a proceeding that interfaces with DRIVE Act EDSSS design. Together, these dockets—9761 (DRIVE implementation), 9715 (Energy Storage Program), RM85 (Energy Storage regulations), and 9778 (VPP policy)—form the active regulatory track for storage/VPP deployment and cost-effective grid modernization in Maryland.