EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTING LA W.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*hb1256*
HOUSE BILL 1256
M5, C5 4lr1718
CF SB 959
By: Delegate Fraser–Hidalgo
Introduced and read first time: February 8, 2024
Assigned to: Economic Matters
Committee Report: Favorable with amendments
House action: Adopted
Read second time: March 8, 2024
CHAPTER ______
AN ACT concerning 1
Electricity – Tariffs, Distributed Energy Resources, and Electric Distribution 2
System Support Services 3
(Distributed Renewable Integration and Vehicle Electrification (DRIVE) Act) 4
FOR the purpose of requiring the Public Service Commission, on or before a certain date, 5
to adopt a transition plan requiring each electric company to transition customers to 6
a certain time–of–use tariff on or before a certain date; requiring a certain electric 7
company to file certain time–of–use tariffs with the Public Service Commission on or 8
before a certain date; requiring a certain electric company to attempt to achieve a 9
certain enrollment target for certain tariffs by a certain date; authorizing the 10
Commission to require the automatic enrollment of certain customers in a 11
time–of–use tariff, on an opt–out basis; requiring the Commission to adopt certain 12
regulations on or before a certain date regarding the interconnection of certain 13
systems to the electric distribution system; prohibiting an electric company from 14
requiring a certain customer to enter into a certain contract or apply for 15
interconnection with the electric distribution system; requiring a certain electric 16
company to require a customer to apply for interconnection with the electric 17
distribution system under certain circumstances; requiring the Commission to 18
develop a program for each a certain electric company to establish a pilot program 19
or temporary tariff to compensate certain persons for electric distribution system 20
support services in a certain manner; requiring each electric company to submit the 21
pilot program or temporary tariff to the Commission for approval on or before a 22
certain date; authorizing a certain electric company to propose and the Commission 23
to approve certain performance mechanisms for a certain purpose under certain 24
circumstances; requiring the Commission to approve a certain pilot program or tariff 25 2 HOUSE BILL 1256
by a certain date; authorizing the Commission to approve or require an a certain 1
electric company to offer certain incentives or rebates under certain circumstances; 2
requiring the Commission to consider establishing a certain limit on the amount of 3
certain incentives or rebates; authorizing an a certain electric company to recover 4
certain costs; prohibiting the dispatch of energy from a certain energy storage device 5
to the electric distribution system under a pilot program or temporary tariff from 6
being considered duplicative of any value realized by a certain customer through net 7
energy metering; and generally relating to the generation and provision of electricity 8
in the State. 9
BY repealing and reenacting, without amendments, 10
Article – Public Utilities 11
Section 1–101(a) 12
Annotated Code of Maryland 13
(2020 Replacement Volume and 2023 Supplement) 14
BY adding to 15
Article – Public Utilities 16
Section 1–101(p–1); and 7–1001 through 7–1008 7–1007 to be under the new subtitle 17
“Subtitle 10. Electric Distribution System Support Services” 18
Annotated Code of Maryland 19
(2020 Replacement Volume and 2023 Supplement) 20
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 21
That the Laws of Maryland read as follows: 22
Article – Public Utilities 23
1–101. 24
(a) In this division the following words have the meanings indicated. 25
(P–1) “INVESTOR–OWNED ELECTRIC COMPA NY” MEANS AN ELECTRIC 26
COMPANY THAT IS NOT A MUNICIPAL ELECTRIC UTILITY OR AN ELECTR IC 27
COOPERATIVE . 28
SUBTITLE 10. ELECTRIC DISTRIBUTION SYSTEM SUPPORT SERVICES. 29
7–1001. 30
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 31
INDICATED. 32
(B) “BENEFICIAL ELECTRIFIC ATION” MEANS REPLACING DIRE CT FOSSIL 33
FUEL USE WITH ELECTR ICITY. 34
HOUSE BILL 1256 3
(C) “BIDIRECTIONAL ELECTRI C VEHICLE” MEANS AN ELECTRIC VE HICLE 1
THAT IS CAPABLE OF B OTH RECEIVING AND DI SCHARGING ELECTRICIT Y. 2
(D) “DISTRIBUTED ENERGY RE SOURCE” MEANS AN ENERGY RESO URCE 3
LOCATED ON A CUSTOME R’S PREMISES THAT : 4
(1) PRODUCES OR STORES ELECTRICITY; OR 5
(2) MODIFIES THE TIMING OR AMOUNT OF THE CUS TOMER’S 6
ELECTRICITY CONSUMPT ION. 7
(E) (1) “ELECTRIC DISTRIBUTION SYSTEM SUPPORT SERVI CES” MEANS 8
THE DISPATCH AND CON TROL OF A DISTRIBUTE D ENERGY RESOURCE TO PROVIDE 9
SERVICES THAT CONTRI BUTE TO THE EFFICIENT AND RE LIABLE OPERATION OF THE 10
ELECTRIC DISTRIBUTIO N SYSTEM BY: 11
(I) AN ELECTRIC COMPANY ; OR 12
(II) AN AGGREGATOR ACTING : 13
1. AT THE DIRECTION OF AN ELECTRIC COMPANY ; OR 14
2. UNDER A PROGRAM OR T ARIFF APPROVED BY TH E 15
COMMISSION. 16
(II) AN AGGREGATOR ACTING AT THE DIRECTION OF AN 17
ELECTRIC COMPANY . 18
(2) “ELECTRIC DISTRIBUTION SYSTEM SUPPORT SERVI CES” 19
INCLUDES: 20
(I) LOCAL OR SYSTEM PEAK DEMAND REDUCTION ; 21
(II) DEMAND RESPONSE ; 22
(III) THE AVOIDANCE OR DEF ERRAL OF A TRANSMISSION OR 23
DISTRIBUTION UPGRADE OR CAPACITY EXPANSIO N; AND 24
(IV) FACILITATING HOSTING CAPACITY TO ACCOMMOD ATE 25
ADDITIONAL DISTRIBUT ED ENERGY RESOURCES . 26
(F) “ELIGIBLE CUSTOMER –GENERATOR ” HAS THE MEANING STAT ED IN § 27
7–306 OF THIS TITLE. 28
4 HOUSE BILL 1256
(G) “NET ENERGY METERING ” HAS THE MEANING STAT ED IN § 7–306 OF 1
THIS TITLE. 2
(H) “NET EXCESS GENERATION ” HAS THE MEANING STAT ED IN § 7–306 OF 3
THIS TITLE. 4
(I) (1) “RENEWABLE ON –SITE GENERATING SYST EM” MEANS AN ENERGY 5
SYSTEM LOCATED ON A CUSTOMER’S PREMISES THAT : 6
(I) GENERATES OR STORES ELECTRICITY FROM A TIER 1 7
RENEWABLE SOURCE OR A TIER 2 RENEWABLE SOURCE THAT DOES NOT RELEAS E 8
GREENHOUSE GASES ; 9
(II) IS CAPABLE OF PROVID ING ELECTRICITY TO : 10
1. A HOME, BUSINESS, OR OTHER STRUCTURE S ERVICED 11
BY AN ELECTRIC COMPANY; AND 12
2. THE ELECTRIC DISTRIB UTION SYSTEM; 13
(III) IS PAIRED WITH AN EN ERGY STORAGE DEVICE THAT IS 14
CONFIGURED TO CHARGE FROM: 15
1. THE RENEWABLE SOURCE ; AND 16
2. THE ELECTRIC DISTRIB UTION SYSTEM UNLESS, FOR 17
THE PURPOSE OF ELIGI BILITY FOR NET ENERGY METERI NG, THE DEVICE IS 18
REQUIRED TO BE CHARG ED ONLY FROM THE REN EWABLE SOURCE ; AND 19
(IV) IS INTERCONNECTED AN D OPERATES IN PARALL EL WITH AN 20
ELECTRIC COMPANY ’S TRANSMISSION AND D ISTRIBUTION FACILITI ES. 21
(2) “RENEWABLE ON –SITE GENERATING S YSTEM” INCLUDES MAY 22
INCLUDE BIDIRECTIONAL ELECTR IC VEHICLE SERVICE E QUIPMENT LOCATED ON A 23
CUSTOMER’S PREMISES. 24
(J) “TIER 1 RENEWABLE SOURCE ” HAS THE MEANING STAT ED IN § 7–701 OF 25
THIS TITLE. 26
(K) “TIER 2 RENEWABLE SOURCE ” HAS THE MEANING STAT ED IN § 7–701 OF 27
THIS TITLE. 28
7–1002. 29
HOUSE BILL 1256 5
THE GENERAL ASSEMBLY FINDS AND DE CLARES THAT: 1
(1) WELL–DESIGNED TIME –OF–USE PRICING OF ELECT RICITY CAN 2
HELP MITIGATE THE IM PACTS OF ELECTRIFICA TION ON THE ELECTRIC 3
DISTRIBUTION SYSTEM , REDUCE GREENHOUSE GA S EMISSIONS DURING PEAK 4
HOURS, AND ENCOURAGE CUSTOM ER ADOPTION OF BENEF ICIAL ELECTRIFICATIO N 5
MEASURES THROUGH OFF –PEAK COST SAVINGS ; 6
(2) WIDESPREAD BENEFICIA L ELECTRIFICATION WI LL INCREASE 7
DEMAND ON THE ELECTR IC DISTRIBUTION SYST EM AND POTENTIALLY R EQUIRE 8
SIGNIFICANT SYSTEM UPGRADES I F CONSUMERS ADOPTING BENEFICIAL 9
ELECTRIFICATION MEAS URES DO NOT ENGAGE I N A FORM OF LOAD MAN AGEMENT 10
TO MITIGATE THE NEED FOR SYSTEM UPGRADES AND REDUCE THE GREEN HOUSE 11
GAS INTENSITIES ASSO CIATED WITH GENERATI ON EMISSIONS DURING PEAK HOUR S; 12
(3) PAIRING THE ADOPTION OF RENEWABLE ON –SITE GENERATING 13
SYSTEMS WITH BENEFIC IAL ELECTRIFICATION MEASURES MAY : 14
(I) FURTHER REDUCE THE STATE’S GREENHOUSE GAS 15
EMISSIONS; 16
(II) PROVIDE ON–SITE RESILIENCE TO C ONSUMERS; AND 17
(III) FACILITATE LOA D FLEXIBILITY TO MIT IGATE IMPACTS ON 18
THE ELECTRIC DISTRIB UTION SYSTEM FROM LO AD GROWTH DUE TO BEN EFICIAL 19
ELECTRIFICATION ; AND 20
(4) IT IS REASONABLE TO PROVIDE ADDITIONAL I NCENTIVES AND 21
PROTECTIONS TO LOW – AND MODERATE –INCOME HOUSEHOLDS : 22
(I) TO ENSURE ACCESS TO THE BENEFI TS OF ELECTRIFICATIO N 23
AND ON–SITE ENERGY SYSTEMS ; AND 24
(II) TO PROTECT THOSE HOU SEHOLDS FROM NEGATIV E BILL 25
IMPACTS DURING A TRA NSITION TO TIME–OF–USE RATES. 26
7–1003. 27
(A) SUBJECT TO SUBSECTION S (D) AND (E) OF THIS SECTION , ON OR 28
BEFORE DECEMBER 31, 2025, THE COMMISSION SHALL ADOP T A TRANSITION PLAN 29
TO REQUIRE EACH ELEC TRIC COMPANY TO TRAN SITION EACH CUSTOMER , ON OR 30
BEFORE SEPTEMBER 1, 2028, TO A TIME–OF–USE TARIFF. 31
6 HOUSE BILL 1256
(B) THE TRANSITION PLAN R EQUIRED UNDER SUBSEC TION (A) OF THIS 1
SECTION SHALL INCLUDE PROVISIONS TO EASE T HE TRANSITION TO A T IME–OF–USE 2
TARIFF FOR CUSTOMERS IN LOW– AND MODERATE –INCOME HOUSEHOLDS . 3
(C) THE TRANSITION TO A T IME–OF–USE TARIFF SHALL : 4
(1) ESTABLISH A SUFFICIE NT PRICE REDUCTION F OR OFF–PEAK 5
HOURS COMPARED TO PEAK HOU RS TO ENCOURAGE CUST OMERS TO ADJUST THEI R 6
ELECTRICITY USAGE TO OFF–PEAK HOURS; AND 7
(2) ADEQUATELY EDUCATE A ND ENCOURAGE CUSTOME RS TO ADJUST 8
THEIR ELECTRICITY US AGE TO BENEFIT FROM LOWER RATES DURING O FF–PEAK 9
HOURS. 10
(D) (1) EACH ELECTRIC COMPANY SHALL PROVIDE TO ITS CUSTO MERS 11
NOTICE AND AN OPPORT UNITY TO OPT OUT OF A TIME–OF–USE TARIFF UNDER THI S 12
SECTION. 13
(2) A CUSTOMER IS CONSIDER ED TO HAVE GIVEN PER MISSION TO THE 14
ELECTRIC COMPANY TO TRANSITION THE CUSTO MER TO THE TIME –OF–USE TARIFF: 15
(I) ON RECEIPT BY THE EL ECTRIC COMPANY OF A RETURNED 16
NOTICE EXPLICITLY GR ANTING PERMISSION ; OR 17
(II) IF THE ELECTRIC COMP ANY HAS NOT RECEIVED A 18
RETURNED NOTICE WITH IN 30 DAYS AFTER THE NOTIC E IS GIVEN. 19
(3) A CUSTOMER WHO HAS REF USED PERMISSION TO TRANSI TION TO 20
A TIME–OF–USE TARIFF MAY LATER REQUEST TO TRANSITIO N TO THE TIME–OF–USE 21
TARIFF. 22
(E) FOR GOOD CAUSE SHOWN , THE COMMISSION MAY DELAY FOR A 23
REASONABLE PERIOD OF TIME THE DEADLINE FO R AN ELECTRIC COMPAN Y TO 24
TRANSITION THEIR CUS TOMERS TO A TIME–OF–USE TARIFF. 25
7–1003. 26
(A) (1) ON OR BEFORE JULY 1, 2025, EACH INVESTOR –OWNED ELECTRIC 27
COMPANY SHALL FILE W ITH THE COMMISSION ONE OR MOR E TIME–OF–USE TARIFFS 28
FOR APPROPRIATE CUST OMER CLASSES , TO BE MADE AVAILABLE TO CUSTOMERS ON 29
AN OPT–IN BASIS. 30
(2) EACH TIME–OF–USE TARIFF SHALL EST ABLISH A SUFFICIENT 31
PRICE DISCOUNT FOR O FF–PEAK HOURS COMPARED TO PEAK HOURS , AS 32 HOUSE BILL 1256 7
DETERMINED BY THE MA RKET OR AN INVESTOR –OWNED ELECTRIC COMPA NY’S 1
COST OF SERVICE , TO ENCOURAGE CUSTOME RS TO ADJUST ELECTRI CITY USE TO 2
OFF–PEAK HOURS. 3
(B) (1) (I) AN INVESTOR –OWNED ELECTRIC COMPA NY SHALL 4
PROPOSE WITH EACH TA RIFF OR TARIFFS REQU IRED UNDER SUBSECTIO N (A) OF 5
THIS SECTION A REASO NABLE ENROLLMENT TAR GET TO TRY TO ACHIEV E BY 6
JANUARY 1, 2028. 7
(II) THE INVESTOR –OWNED ELECTRIC COMPANY SHA LL 8
ATTEMPT TO ACHIEVE T HE ENROLLMENT TARGET THROUGH A COMBINATIO N OF 9
MARKETING, CUSTOMER EDUCATION , AND OTHER MEANS TO C OMMUNICATE THE 10
BENEFITS AND RISKS O F TIME–OF–USE RATES. 11
(2) (I) THE COMMISSION MAY REQUIR E AN INVESTOR –OWNED 12
ELECTRIC COMPANY TO AUT OMATICALLY ENROLL IN A TIME–OF–USE TARIFF 13
CUSTOMERS THAT RECEI VE AN INCENTIVE FROM THE INVESTOR–OWNED ELECTRIC 14
COMPANY AS PART OF A BENEFICIAL ELECTRIFI CATION PROGRAM . 15
(II) THE COMMISSION SHALL REQU IRE AN INVESTOR –OWNED 16
ELECTRIC COM PANY TO PROVIDE TO C USTOMERS THAT ARE AU TOMATICALLY 17
ENROLLED IN A TIME –OF–USE TARIFF IN ACCORD ANCE WITH SUBPARAGRA PH (I) OF 18
THIS PARAGRAPH NOTIC E AND AN OPPORTUNITY TO OPT OUT OF THE TI ME–OF–USE 19
TARIFF. 20
(C) ON OR BEFORE JULY 1, 2026, EACH INVESTOR –OWNED ELECTRIC 21
COMPANY SHALL SUBMIT A REPORT TO THE COMMISSION EVALUATING : 22
(1) THE POTENTIAL TO AVO ID OR DEFER ELECTRIC DISTRIBUTION 23
SYSTEM CAPITAL PROJE CTS THROUGH THE USE OF TIME–OF–USE RATES , 24
DEMAND–RESPONSE AND DEMAND –SIDE PROGRAMS , AND RENEWABLE ON –SITE 25
GENERATING SYSTEMS ; AND 26
(2) THE MERITS AND FEASI BILITY OF TRANSITION ING ALL 27
CUSTOMERS TO A TIME –OF–USE TARIFF ON AN OPT –OUT BASIS. 28
(D) IN ACCORDANCE WITH § 2–1257 OF THE STATE GOVERNMENT ARTICLE, 29
ON OR BEFORE DECEMBER 31, 2027, THE COMMISSION SHALL SUBMIT A REPORT TO 30
THE GENERAL ASSEMBLY ON: 31
(1) THE IMPACTS OF OPT –IN TIME–OF–USE TARIFFS ON THE 32
ELECTRIC DISTRIBUTIO N SYSTEM; 33
8 HOUSE BILL 1256
(2) THE TIMELINE, FEASIBILITY, AND MERITS OF TRANSI TIONING ALL 1
CUSTOMERS TO A TIME –OF–USE TARIFF ON AN OPT –OUT BASIS; AND 2
(3) WHETHER A FULL TRANS ITION TO TIME –OF–USE RATES IS 3
JUSTIFIED. 4
(E) AN INVESTOR –OWNED ELECTRIC COMPA NY MAY RECOVER ALL 5
REASONABLE AND PRUDE NT COSTS, INCLUDING MARKETING COSTS, TO ACHIEVE ITS 6
PROPOSED ENROLLMENT TARGETS AND EXECUTE ITS RESPONSIBILITIE S IN 7
ACCORDANCE WITH THIS SECTION. 8
(F) FOR GOOD CAUSE SHOWN , THE COMMISSION MAY DELAY FOR A 9
REASONABLE PERIOD OF TIME THE DEADLINE FO R AN INVESTOR–OWNED ELECTRIC 10
COMPANY TO COMPLY WI TH THE PROVISIONS OF THIS SECTION. 11
(G) (1) A MUNICIPAL ELECTRIC U TILITY OR ELECTRIC COOPER ATIVE 12
MAY FILE WITH THE COMMISSION ONE OR MOR E TIME–OF–USE TARIFFS IN THE 13
SAME MANNER AS AN IN VESTOR–OWNED ELECTRIC COMPA NY UNDER THIS SECTIO N. 14
(2) IF A MUNICIPAL ELECTR IC UTILITY OR ELECTR IC COOPERATIVE 15
ELECTS TO FILE WITH THE COMMISSION A TIME–OF–USE TARIFF UNDER THI S 16
SECTION, THE PROVISIONS OF TH IS SECTION THAT APPL Y TO AN INVESTOR –OWNED 17
ELECTRIC COMPANY SHA LL ALSO APPLY TO THE MUNICIPAL ELECTRIC U TILITY OR 18
ELECTRIC COOPERATIVE . 19
7–1004. 20
(A) ON OR BEFORE APRIL MAY 1, 2025, THE COMMISSION SHALL ADOP T 21
REGULATIONS TO : 22
(1) ESTABLISH EXPEDITED PROCESSES FOR INTERC ONNECTING THE 23
FOLLOWING SYSTEMS TO THE ELECTRIC DISTRIB UTION SYSTEM: 24
(1) (I) BIDIRECTIONAL ELECTR IC VEHICLE SYSTEMS C APABLE OF 25
PROVIDING ELECTRICIT Y TO THE ELECTRIC DI STRIBUTION SYSTEM ; AND 26
(2) (II) BIDIRECTIONAL ELECTR IC VEHICLE SYSTEMS T HAT DO NOT 27
PROVIDE ELECTRICITY TO THE ELECTRIC DIST RIBUTION SYSTEM BUT DO PROVIDE 28
ELECTRICITY TO A HOM E, BUSINESS, OR OTHER STRUCTURE S ERVICED BY AN 29
ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY; AND 30
(2) PROVIDE INVESTOR –OWNED ELECTRIC COMPA NIES WITH 31
ADEQUATE TIME TO ENS URE ELECTRIC DISTRIB UTION SYSTEM RELIABI LITY IN 32 HOUSE BILL 1256 9
ADVANCE OF THE INTER CONNECTIONS DESCRIBE D IN ITEM (1) OF THIS 1
SUBSECTION. 2
(B) AN ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY: 3
(1) MAY REQUIRE A CUSTOM ER TO PROVIDE NOTICE TO THE 4
ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY IF THE CUSTO MER INSTALLS A 5
BIDIRECTIONAL ELECTR IC VEHICLE SYSTEM DE SCRIBED IN SUBSECTIO N (A) 6
(A)(1)(II) OF THIS SECTION; BUT AND 7
(2) MAY NOT REQUIRE THE CUSTOMER TO ENTE R INTO A NET ENERGY 8
METERING CONTRACT OR OTHERWISE APPLY FOR INTERCONNECTION WITH THE 9
ELECTRIC DISTRIBUTIO N SYSTEM. 10
(2) SHALL REQUIRE A CUST OMER TO APPLY FOR IN TERCONNECTION 11
IF THE CUSTOMER CONF IGURES A BIDIRECTION AL ELECTRIC VEHICLE SYSTEM TO 12
PROVIDE ELECTRICITY TO THE ELECTRIC DIST RIBUTION SYSTEM . 13
(C) A MUNICIPAL ELECTRIC U TILITY OR AN ELECTRI C COOPERATIVE MAY 14
COMPLY WITH THE REQU IREMENTS OF SUBSECTI ON (B) OF THIS SECTION IN T HE 15
SAME MANNER AS AN IN VESTOR–OWNED ELECTRIC COM PANY. 16
7–1005. 17
(A) (1) THE COMMISSION SHALL DEVE LOP A PROGRAM FOR EA CH 18
ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY TO ESTABLISH A PILOT PROGRAM 19
OR TEMPORARY TARIFF TO COMPENSATE OWNERS AND AGGREGATORS OF 20
DISTRIBUTED ENERGY R ESOURCES FOR ELECTRI C DISTRIBUTION SYSTEM SUPPORT 21
SERVICES ON A PAY –FOR–PERFORMANCE BASIS THROUGH AN INCENTIVE 22
MECHANISM DETERMINED BY THE COMMISSION. 23
(2) ON OR BEFORE JANUARY 1, 2025, THE COMMISSION SHALL 24
ADOPT REGULATIONS ES TABLISHING PROGRAM R EQUIREMENTS TO ACHIE VE 25
ELECTRIC SYSTEM BENEFITS USING DISTR IBUTED ENERGY RESOUR CES. 26
(B) (1) (I) ON OR BEFORE JULY 1, 2025, EACH ELECTRIC 27
INVESTOR–OWNED ELECTRIC COMPANY SHALL SUBMIT TO THE COMMISSION FOR 28
APPROVAL A PILOT PRO GRAM OR TEMPORARY TARIFF FOR ELECTRIC 29
DISTRIBUTION SYSTEM SUPPORT SERVICES THA T PROVIDES REASONABL E 30
COMPENSATION ON A PAY–FOR–PERFORMANCE BASIS TO RENEWABLE ON–SITE 31
GENERATING SYSTEMS THROUGH A MECHANISM DETERMINED BY THE 32
COMMISSION. 33
10 HOUSE BILL 1256
(2) (II) THE PILOT PROGRAM OR TEMPORA RY TARIFF SUBMITTED 1
UNDER PARAGRAPH (1) OF THIS SUBSECTION SUBPARAGRAPH (I) OF THIS 2
PARAGRAPH SHALL PROVIDE THAT E LECTRIC DISTRIBUTION SYSTEM SUPPORT 3
SERVICES TO ON –SITE ENERGY STORAGE DEVICES BE USED FOR SYSTEM PEAK 4
REDUCTION ACCORDING TO A SCHED ULE AT A FREQUENCY OF AT LEAS T 30 EVENTS 5
PER YEAR. 6
(C) ANY PILOT PROGRAM OR TEMPORARY TARIFF SUB MITTED UNDER THIS 7
SECTION SHALL ESTABL ISH A STRUCTURE FOR PERFORMANCE PAYMENTS THAT IS 8
DESIGNED TO COVER TH E COST OF DISTRIBUTE D ENERGY RESOURCES T O AN OWNER 9
OR AGGREG ATOR PROVIDING ELECT RIC DISTRIBUTION SYS TEM SUPPORT 10
SERVICES. 11
(2) (I) A MUNICIPAL ELECTRIC U TILITY OR AN ELECTRI C 12
COOPERATIVE MAY ESTA BLISH A PILOT PROGRA M, TEMPORARY TARIFF , OR 13
PERFORMANCE MECHANIS M UNDER THIS SECTION . 14
(II) IF A MUNICIPAL ELECTR IC UTILITY OR ELECTRIC 15
COOPERATIVE ESTABLIS HES A PILOT PROGRAM , TEMPORARY TARIFF , OR 16
PERFORMANCE MECHANIS M UNDER THIS SECTION , THE PROVISIONS OF TH IS 17
SECTION AND §§ 7–1006 AND 7–1007 OF THIS SUBTITLE THA T APPLY TO AN 18
INVESTOR–OWNED ELECTRIC COMPA NY SHALL ALSO APPLY TO THE MUNICIP AL 19
ELECTRIC UTILITY OR ELECTRIC COOPERATIVE . 20
(C) (1) NOTWITHSTANDING ANY P ROVISION OF THIS SUB TITLE, AN 21
INVESTOR–OWNED ELECTRIC COMPA NY MAY PROPOSE AND S UBMIT TO THE 22
COMMISSION A PERFORMA NCE MECHANISM TO COV ER THE COST OF USING 23
DISTRIBUTED ENERGY RESOUR CES OR AN AGGREGATOR OF DISTRIBUTED ENERG Y 24
RESOURCES UNDER THIS SUBTITLE. 25
(2) THE COMMISSION MAY APPROV E A PERFORMANCE MECH ANISM 26
SUBMITTED UNDER PARA GRAPH (1) OF THIS SUBSECTION I F THE COMMISSION 27
DETERMINES THAT THE PERFORMANCE MECHANISM IS IN THE PUBLIC INTEREST . 28
(D) (1) ON OR BEFORE OCTOBER 1, 2025, THE THE COMMISSION SHALL 29
APPROVE, DENY, OR APPROVE WITH AMEN DMENTS A PILOT PROGR AM OR 30
TEMPORARY TARIFF SUB MITTED UNDER THIS SE CTION FOR EACH ELECTRIC 31
INVESTOR–OWNED ELECTRIC COMPANY IN AN EXPEDITED MANN ER. 32
(2) THE COMMISSION SHALL IF THE COMMISSION DETERMINES THAT 33
TRANSITIONING A PILO T PROGRAM OR TEMPORA RY TARIFF TO A PERMA NENT 34
PROGRAM OR TARIFF IS IN THE PUBLIC INTERE ST, THE COMMISSION MAY 35
ESTABLISH A PROCESS FOR AN ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY 36 HOUSE BILL 1256 11
TO TRANSITION A PILO T PROGRAM OR TEMPORA RY TARIFF TO A PERMA NENT 1
PROGRAM OR TARIFF FO R ELECTRIC DISTRIBUT ION SYSTEM SUPPORT S ERVICES. 2
(3) EACH IF THE COMMISSION DETERMINES THE TRANSITION TO A 3
PERMANENT PROGRAM OR TARIFF IS IN THE PUBLIC INTERE ST, EACH CUSTOMER 4
PARTICIPATING IN A P ILOT PROGRAM OR TEMP ORARY TARIFF APPROVE D UNDER 5
PARAGRAPH (1) OF THIS SUBSECTION SHALL MAY BE TRANSITIONED TO A 6
PERMANENT PROGRAM OR TARIFF FOR ELECTRIC DISTRIBUTION SYSTEM SUPPORT 7
SERVICES WHEN THE PROGRAM OR TARIF F IS APPROVED BY THE COMMISSION. 8
(E) (1) THE COMMISSION MAY ALLOW THE ENERGY GENERATED BY A 9
RENEWABLE ON –SITE GENERATING SYST EM THAT PROVIDES ELE CTRIC 10
DISTRIBUTION SYSTEM SUPPORT SERVICE UNDE R A PILOT PROGRAM OR 11
TEMPORARY TARIFF APP ROVED UNDER SUBSECTION (D)(1) OF THIS SECTION TO 12
COUNT TOWARDS THE ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY’S 13
GREENHOUSE EMISSIONS REDUCTION GOALS UNDE R § 7–211 OF THIS TITLE. 14
(2) (I) SUBJECT TO SUBPARAGRA PH (II) OF THIS PARAGRAPH , THE 15
CUMULATIVE ENERGY S TORAGE CAPACITY OF A NY ENERGY STORAGE DE VICES 16
INSTALLED ON A CUSTO MER’S PROPERTY IN ACCORD ANCE WITH THIS SUBTI TLE 17
SHALL COUNT TOWARDS THE TARGETS ESTABLIS HED UNDER § 7–216.1 OF THIS 18
TITLE. 19
(II) SUBPARAGRAPH (I) OF THIS PARAGRAPH DO ES NOT 20
INCLUDE THE EN ERGY STORAGE CAPACIT Y OF: 21
1. ELECTRIC VEHICLES TH AT ARE PART OF A 22
RENEWABLE ON –SITE GENERATING SYST EM; OR 23
2. MOBILE ENERGY STORAG E DEVICES. 24
(F) THE CUMULATIVE NAMEPL ATE CAPACITY OF RENE WABLE ON–SITE 25
GENERATING SYSTEMS P ARTICIPATING IN A PI LOT PROGRAM OR TEMPO RARY 26
TARIFF APPROVED UNDE R THIS SECTION MAY N OT EXCEED 2% OF THE 27
INVESTOR–OWNED ELECTRIC COMPA NY’S HIGHEST RECORDED C OINCIDENT PEAK 28
DEMAND. 29
7–1006. 30
(A) (1) THE COMMISSION MAY APPROVE OR REQUIRE A N 31
INVESTOR–OWNED ELECTRIC COMPANY TO OFFER UPFRONT INCENT IVES OR 32
REBATES TO CUSTOMERS TO ACQUIRE AND INSTA LL RENEWABLE ON –SITE 33
GENERATING SYSTEMS I F THE CUSTOMER : 34
12 HOUSE BILL 1256
(I) ENROLLS IN A PILOT P ROGRAM OR TEMPORARY TARIF F 1
ESTABLISHED UNDER § 7–1005 OF THIS SUBTITLE; AND 2
(II) ALLOWS THE SYSTEM TO BE USED FOR ELECTRIC 3
DISTRIBUTION SYSTEM SUPPORT SERVICES FOR A PERIOD OF NOT LESS THAN 5 4
YEARS. 5
(2) THE COMMISSION MAY : 6
(I) AUTHORIZE OR REQUIRE AN INVESTOR–OWNED ELECTRIC 7
COMPANY TO PROVIDE A N ADDITIONAL INCENTI VE OR REBATE FOR LOW – OR 8
MODERATE–INCOME CUSTOMERS WHO APPLY FOR AN INCENTI VE OR REBATE 9
UNDER THIS SECTION ; AND 10
(II) REQUIRE AN INVESTOR–OWNED ELECTRIC COMPANY TO 11
PRIORITIZE THE OFFER OF INCENTIVES OR REBATE S UNDER THIS SECTION TO 12
LOW– OR MODERATE –INCOME CUSTOMERS . 13
(B) IN DETERMINING WHETHE R TO REQUIRE AN INVESTOR–OWNED 14
ELECTRIC COMPANY TO OFFER AN INCENTIVE O R REBATE UNDER THIS SECTION, 15
THE COMMISSION SHALL CONS IDER: 16
(1) THE BENEFIT OF REDUCING THE OPER ATION OF PEAK 17
GENERATING FACILITIE S IN OVERBURDENED AN D UNDERSERVED COMMUN ITIES; 18
(2) THE BENEFIT OF RESIL IENCY AND SERVICE OU TAGE AVOIDANCE 19
FOR CUSTOMERS WITH O N–SITE GENERATING SYST EMS; AND 20
(3) THE POTENTIAL FOR ELECTRIC INVESTOR–OWNED ELECTRIC 21
COMPANIES TO REDUCE EXPENSES RELATING TO ELECTRIC DISTRIBUTIO N SYSTEM 22
INFRASTRUCTURE BY LE VERAGING CUSTOMERS ’ ON–SITE GENERATING SYST EMS. 23
(C) THE COMMISSION SHALL CONS IDER ESTABLISHING A LIMIT ON THE 24
AMOUNT OF INCENTIVES OR REBATE S ISSUED IN A MANNER THAT ACHIEVES 25
DEPLOYMENT GOALS WHI LE MITIGATING POTENT IAL CUSTOMER IMPACTS . 26
(D) THE COMMISSION SHALL CONS ULT WITH THE MARYLAND ENERGY 27
ADMINISTRATION , WHEN APPROVING OR RE QUIRING AN INCENTIVE OR REBATE 28
UNDER THIS SECTION , TO ENSURE TH AT THE INCENTIVE OR REBATE IS DESIGNED 29
TO SUPPLEMENT , TO THE GREATEST EXTE NT POSSIBLE, OTHER AVAILABLE STATE 30
AND FEDERAL INCENTIV ES FOR CUSTOMER ADOP TION OF RENEWABLE ON –SITE 31
GENERATING SYSTEMS . 32
7–1007. 33 HOUSE BILL 1256 13
(A) AN ELECTRIC INVESTOR–OWNED ELECTRIC COMPANY MA Y RECOVER 1
ALL REASONABLE COSTS INCURRED IN: 2
(1) PARTICIPATING IN A PILOT PROGRAM OR T EMPORARY TARIFF 3
AND ADMINISTERING A PROGRAM UNDER § 7–1005 OF THIS SUBTITLE; AND 4
(2) OFFERING AN UPFRONT INCENTIVE OR REBATE UNDER § 7–1006 5
OF THIS SUBTITLE. 6
(B) TO THE EXTENT FEASIBL E, THE COSTS LISTED IN SUBSECTION (A) OF 7
THIS SECTION SHALL B E RECOVERED BY THE ELECTRIC INVESTOR–OWNED 8
ELECTRIC COMPANY WITHIN THE C ALENDAR YEAR IN WHIC H THOSE COSTS WERE 9
INCURRED. 10
(C) NOTWITHSTANDING ANY P ROVISION OF THIS SUB TITLE, AN ELECTRIC 11
INVESTOR–OWNED ELECTRIC COMPANY MAY PURSUE A ND USE A PERFORMANCE 12
INCENTIVE MECHANISM TO COVER THE COST OF USING DISTRIBUTED EN ERGY 13
RESOURCES OR AN AGGR EGATOR OF DISTRIBUTE D RESOURCES UNDER TH IS 14
SUBTITLE. 15
7–1008. 16
(A) THIS SECTION APPLIES ONLY TO AN ELIGIBLE CUS TOMER–GENERATOR 17
THAT IS: 18
(1) PARTICIPATING IN AN ELECTRIC COMPANY ’S NET ENERGY 19
METERING PROGRAM ; AND 20
(2) USING AN ENERGY STOR AGE DEVICE THAT : 21
(I) IS CHARGED ONLY FROM THE ELIGIBLE 22
CUSTOMER–GENERATOR ’S GENERATING FACILIT Y THAT CREATES NET EXCESS 23
GENERATION ; OR 24
(II) ACCRUES NET EXCESS G ENERATION ONLY FOR E NERGY 25
CREATED BY AN ON –SITE ENERGY GENERATI NG SYSTEM. 26
(B) THE DISPATCH OF ENERG Y FROM AN ENERGY STO RAGE DEVICE TO THE 27
ELECTRIC DISTRIBUTIO N SYSTEM UNDER A PIL OT PROGRAM OR TEMPORARY 28
TARIFF ESTABLISHED U NDER § 7–1005 OF THIS SUBTITLE MAY NOT BE CONSIDERED 29
DUPLICATIVE OF ANY V ALUE REALIZED BY THE ELIGIBLE CUSTOMER –GENERATOR 30
THROUGH NET ENERGY M ETERING. 31
14 HOUSE BILL 1256
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 1
October 1, 2024. 2
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.