Maryland Electricity Imports
Maryland Electricity Imports
Maryland generates roughly 60% of the electricity it consumes; the remaining 40% is imported from other PJM states. It is often assumed that these imports cost more than in‑state generation. That assumption is incorrect.
In PJM, all generators—inside or outside Maryland—are paid the same locational marginal price (LMP) at a Maryland pricing node (pnode). There is no import premium, no separate import tariff, and no state‑line surcharge.
Maryland’s LMP reflects:
- regional supply and demand
- transmission constraints
- the marginal unit’s production cost
Generation location does not affect the wholesale price.
Retail electricity prices are not driven by whether or not electricity is imported but rather by:
- distribution system costs
- transmission investments
- utility rate design
- capacity and ancillary service obligations
- state policy requirements
Because state coal retirements have reduced in-state supply, and natural gas development is limited, Maryland imports power. The lowest-cost marginal units are often in Pennsylvania, West Virginia and Ohio, resulting in imports frequently lowering Maryland’s costs, because cheaper out‑of‑state units often set the clearing price.
The only circumstance in which Maryland may see higher prices is when there is transmission congestion, which raises LMPs at specific nodes. Congestion is a locational phenomenon—not an import penalty—and can occur entirely within a single state.
In Summary:
Maryland does not pay more for imported electricity. Maryland pays the PJM locational marginal price, which applies equally to in‑state and out‑of‑state generation. Claims that imports inherently increase costs are incorrect under PJM’s market structure.
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