How Maryland’s Renewable Energy Law Hurts Maryland

Most energy consumers probably believe that clean renewable energy does not include burning fossil fuels, trash, wood or other waste to produce electricity.

But in Maryland, that is not the case.

That’s because in Maryland, energy providers don’t have to produce clean energy like solar, wind or geothermal to have their electricity sales qualify under the state’s renewable portfolio standard. That standard sets a target of fifty percent renewable electricity by 2030. That’s an ambitious goal. But it is made easier by the fact in Maryland providers can count electricity powered by fossil fuels for about one-half their renewable requirements if they buy “credits” from sources like incinerators that burn household waste or facilities that burn wood and other gas products.

In 2020, credits from these dirty energy sources made up about 24% of the state’s renewable portfolio standard. That standard allows energy companies to buy renewable energy credits from sources and claim the “renewable attributes” of that energy to comply with state law. Unfortunately, many of these energy sources mess up the environment and do nothing to fight climate change. In fact, most do not even provide energy to Maryland residents and businesses.

Some of the projects Maryland subsidizes are so outlandish as to defy logic.

For example, Maryland has subsidized operations at the Blue Plains wastewater treatment plant in Washington, DC. Although the plant delivers no electricity to the grid, the Blue Plains plant sells to Maryland utilities the credits associated with the biogas it burns to help power its plant and create soil conditioner from the sewage. The soil conditioner is sold in hardware stores throughout the region. A May 2021 report from the Sierra Club found that this soil conditioner had alarming levels of toxic per-and polyfluoroalkyl substances (PFAS), known as “forever chemicals,” in it. Of the nine sludge-based fertilizers tested, the highest levels of contamination were found in the soil conditioner from the Blue Plains. Between 2018 and 2020, Maryland energy providers bought an estimated $2 million in credits from Blue Plains. Maryland ratepayers got nothing in return from this investment except toxic fertilizer.

Maryland residents are also subsidizing a facility in southern Virginia that burns wood waste to produce electricity, which sells its energy to customers in North Virginia. Virginia considers the facility too dirty to qualify for its own recently-enacted renewable portfolio standard. Between 2014 and 2020, Northern Virginia Electric Cooperative (NOVEC) sold an estimated $26,213,619 worth of biomass credits from this facility to Maryland electricity providers to meet renewable energy requirements. As a member-owned cooperative, NOVEC passes its earnings to its customers in the form of lower rates. Low-cost electricity is enormously attractive to businesses. In this way Maryland is putting itself at a competitive disadvantage to Virginia by making Northern Virginia a more inviting location for data centers and other businesses.

Maryland consumers’ “renewable” energy dollars are also propping up three highly polluting trash incinerators. These incinerators are misfits in the clean energy world—so much so that county leaders want to shutter the facilities in Baltimore and Montgomery County while a plant in Fairfax County, Virginia is considered one of the top sources of pollution in the Washington, DC area. The Virginia facility is so dirty that it got kicked out of New Jersey’s renewable energy program. However, the facility was able to sell its credits to Maryland energy providers who could then claim their own fossil fuel-powered electricity was renewable under Maryland law.

These examples are just the tip of the iceberg. Public Employees for Environmental Responsibility estimates that between 2008 and 2030, Maryland ratepayers will likely spend about half a billion dollars subsidizing dirty energy sources under the state’s renewable energy law, and most of this will go to out-of-state facilities that provide no energy to Maryland.

Last year, Maryland removed black liquor – a dirty byproduct of the paper industry — from the definition of renewable energy. That was a start, but it just scratches the surface of the problems in Maryland’s renewable program. This year, the General Assembly needs to go further and remove all dirty sources from the renewable portfolio standard and work to ensure the standard provides real clean energy jobs and benefits to all Marylanders.

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Tim Whitehouse is the Executive Director of PEER. Among other things, Tim formerly served as an EPA enforcement attorney.