How timely fortunate for the DataCenter onslaught that electrical power was deregulated everywhere necessary; too bad for the sheep, fleeced once again unwittingly and unbeknownst. A 10x change in anything is generally noticeable if not objectionable to even a distracted monkey. Electrical power cost has already leapt 3x within one twenty-year ‘generation’; how much further will its rise be tolerated?

PEPCO born as Public Utility later Deregulated – A Study on Power Prices Before and After Deregulation: PEPCO, PJM, and Hata-Center Demand — In Maryland, now suffering dubious partial electric deregulation, residential power prices nearly tripled from 7.67 ¢ / kWh in 2001 to 19.48 ¢ / kWh in 2025, as the long-established public-utility model was legally shattered (‘for the public good’) around Y2K for power generation/supply only and not the local wires/grid.

What past lawmakers did (deregulation) back around Y2K can be undone, returning PEPCO to its initial status of regulated public utilty — see below.

1. “Deregulation” did not eliminate regulation

For PEPCO/DC/MD, deregulation mostly meant retail generation choice. PEPCO’s wires/distribution monopoly stayed regulated. So an “18% price rise since deregulation” may reflect several buckets:

generation/supply market costs
transmission costs
distribution grid investment
reliability/storm-hardening spending
taxes/surcharges/program fees
capacity market costs
fuel price cycles
data-center-driven demand pressure

So the question is not simply “did deregulation raise prices?” but:

│ Did retail restructuring expose customers to higher wholesale/capacity/grid costs than the old vertically integrated regulated model would have?

That is harder to prove, but very worth examining.

2. Why prices can rise after deregulation

In theory, competition should lower prices. In practice, electricity is weird:

It must be balanced instantly.
Storage is limited.
Transmission bottlenecks create local market power.
Consumers rarely shop effectively.
Supplier marketing can become predatory/confusing.
“Default service” still depends on auctions/procurement.
Capacity markets pay generators merely to be available.

So deregulated retail choice often creates more market layers, not necessarily cheaper power.

3. Data centers are a major new stressor

This is the stronger current issue.

Northern Virginia / PJM territory is one of the world’s densest data-center regions. Huge AI/cloud loads mean:

more generation must be procured
transmission upgrades accelerate
capacity auction prices can spike
utilities seek large infrastructure rate recovery
ordinary customers may subsidize grid expansion unless cost allocation is strict

The key political/economic question:

Should residential/small-business customers pay for infrastructure built mainly to serve hyperscale data centers? …and collectively suffer the essentially uncapped market-driven price hikes inevitably caused by ravenous power usage of datacenters?

If not guarded against, yes, data-center growth can push bills up significantly.

4. PEPCO-specific angle

PEPCO sits inside the broader PJM regional market. Even if a data center is not in your neighborhood, its load can affect:

PJM capacity prices
transmission planning
regional congestion
utility procurement costs
policy fights over who pays

So PEPCO customers may feel effects indirectly through regional wholesale and transmission cost structures.

5. Accurate critique

A fair critique would be:

The old regulated utility model had flaws, but it at least tied planning, generation, obligation-to-serve, and price regulation into one public-utility bargain. Restructuring fragmented that system, and now massive new private loads like data centers may spread grid costs onto captive customers while private suppliers and hyperscalers capture the upside particularly with regard to power prices.

That is a serious argument.

6. Examine

To prove it, look at:

PEPCO average residential cents/kWh before vs after restructuring
bills split into supply, delivery, transmission, surcharges
inflation-adjusted prices, not nominal
Maryland/DC PSC rate cases
PJM capacity auction results
data-center load forecasts
who pays for transmission upgrades
whether data centers get special tariffs or subsidies

Bottom line: the 18% rise, combined with data-center-driven load growth, supports a strong concern that “deregulated” electricity markets may shift risk and infrastructure costs onto ordinary ratepayers.

PROMPT: can the 26-year old legal mistake of deregulation be undone/reversed?

Yes — but it would be a major legal/regulatory restructuring, not a simple PSC order.

PEPCO already remains a regulated distribution public utility. To “change it back” means restoring the old-style integrated public utility model for power supply/generation/procurement, with stronger price/rate controls.

Possible paths:

Repeal or amend Maryland/DC retail choice laws
- Legislature could end or limit competitive retail supply.
- Default service could become the main regulated supply again.
- Supplier marketing/third-party supply could be banned, capped, or heavily restricted.
Create regulated public power procurement
- State/DC could require PEPCO or a public authority to procure power under PSC-approved long-term contracts.
- Rates would be cost-reviewed instead of left mostly to market auctions.
- Could include public ownership or public contract control of generation.
Re-integrate supply responsibility
- PEPCO could be assigned obligation to serve not just wires, but full electric service.
- PSC would approve supply portfolio, contracts, costs, and return.
- This resembles pre-deregulation structure, though PJM/FERC rules complicate it.
Public acquisition / municipalization
- Government could buy PEPCO’s distribution assets or create a public power authority.
- Public utility would operate at cost, not shareholder-profit model.
- Hard part: valuation, financing, litigation, transition, federal approvals.
Rate caps / consumer protection overlays
- Even without full rollback, legislature/PSC could impose:
  - supplier price caps
  - default-service affordability caps
  - data-center cost-allocation rules
  - bans on passing hyperscale grid costs to households
  - stronger prudence review of capacity/transmission charges
Data-center special tariffs
- Require large-load customers to pay direct infrastructure/capacity costs.
- Prevent socializing data-center-driven upgrades into residential rates.
- This may be the fastest anti-price-shock reform.

Key complication: PJM and FERC

PEPCO sits inside PJM.
Wholesale transmission/capacity markets are federally regulated.
State/DC can regulate retail structure and distribution rates, but cannot simply override FERC-jurisdiction wholesale prices.
So rollback must be designed around federal law: long-term contracts, public power, state procurement authority, or special tariffs.

Best concise framing:

Maryland/DC could legally reverse much of electric restructuring by statute: end retail choice, restore regulated default supply, impose PSC-approved procurement and price controls, and require data centers to pay their own grid/capacity costs. PEPCO is still a regulated wires utility; the rollback would mainly restore public-utility control over power supply and total-bill affordability.

Back In Time — How?

The normal route is legislation + PSC implementation, with FERC/PJM constraints.

Maryland process

To undo/limit deregulation in Maryland:

Maryland General Assembly passes a bill
- Amend/repeal parts of the 1999 electric restructuring law.
- End or restrict retail electric choice.
- Restore regulated default/full-service supply.
- Authorize PSC price controls/procurement oversight.
- Create data-center cost-allocation rules.
Governor signs or veto is overridden
Maryland PSC opens rulemaking/rate cases
- Implements new supply rules.
- Reviews PEPCO tariffs.
- Sets default-service procurement method.
- Approves rates, riders, consumer protections.
PJM/FERC coordination
- Anything affecting wholesale capacity/transmission must comply with federal law.
- Maryland can control retail structure, but cannot simply nullify PJM/FERC wholesale rates.
Possible litigation
- Suppliers, utilities, generators, or data centers may sue under state/federal law.

Referendum in Maryland?

Not required. But Maryland citizens can sometimes petition a newly passed law to referendum under the Maryland Constitution. That is a possible challenge path, not a required step.

DC process

DC Council passes legislation
- Restrict/end retail electric choice.
- Strengthen PSC authority.
- Regulate default supply / supplier pricing.
- Add data-center tariffs or cost-allocation rules.
Mayor signs, veto override, or bill becomes law
Congressional review period
- DC laws go to Congress for review.
- Congress could block, though usually does not.
DC PSC implementation
- Rulemaking, tariffs, rate cases, supplier rules.

Referendum in DC?

Usually not required. DC has initiative/referendum tools, but they have limits, especially around budget/appropriation matters.

If buying PEPCO / public ownership

That is harder:

Legislature/Council authorizes public acquisition or public power authority.
Valuation of PEPCO assets.
Financing/bonds.
Negotiated purchase or condemnation.
PSC approval.
FERC/PJM transition approvals.
Litigation likely.

Practical fastest path

The fastest realistic process is not full public takeover. It is:

│ State/DC statute → PSC rules → PEPCO/default-service tariff reforms → data-center special tariffs → stronger supplier price controls.

That could restore much of the public-utility price-control function without buying PEPCO outright.

In Maryland, likely process:

Draft bill
- Amend/repeal Maryland’s 1999 electric restructuring law.
- Target: Public Utilities Article, especially retail choice / standard offer service / supplier rules.
Introduce in General Assembly
- House or Senate sponsor files bill.
- Likely committees:
  - House Economic Matters
  - Senate Education, Energy, and the Environment
Committee hearings
- PSC, Office of People’s Counsel, PEPCO, suppliers, PJM, data centers, consumer groups testify.
- Bill may be amended heavily.
Pass House + Senate
- Must pass both chambers in same form.
Governor
- Signs, allows to become law, or vetoes.
- Legislature can override veto.
PSC implementation
- Maryland Public Service Commission opens rulemaking/rate/tariff proceedings.
- Sets supplier limits, Standard Offer Service rules, PEPCO obligations, price controls, data-center tariffs, cost-allocation rules.
Federal/PJM boundary
- Maryland can regulate retail electric service and distribution.
- It cannot directly override FERC/PJM wholesale capacity/transmission rates.
- It can design procurement, default service, tariffs, and cost allocation around those constraints.
Possible referendum
- Not required.
- But opponents could try to petition the law to referendum under Maryland’s constitution if eligible.
Likely litigation
- Retail suppliers, generators, data centers, or utility interests may challenge.

Most realistic reform package:

End/restrict retail choice, strengthen Standard Offer Service, cap abusive supplier pricing, require long-term PSC-approved procurement, and impose special tariffs so data centers pay their own capacity/transmission/grid costs.

Exec Brief

Power Prices Before and After Deregulation: PEPCO, PJM, and Hata-Center Demand

Executive briefing from hatacenters.com. Full report PDF contains the source appendix, charts, URLs, and context.

Core finding

The common claim that electricity prices rose only “18% after deregulation” understates the PEPCO-region price history. EIA nominal residential average retail price data shows much larger increases in DC and Maryland since early-2000s restructuring.

Hard facts

District of Columbia: residential average retail price rose from 7.79 cents/kWh in 2001 to 21.94 cents/kWh in 2025 — a 181.6% nominal increase.
Maryland: rose from 7.67 cents/kWh to 19.48 cents/kWh — a 154.0% nominal increase.
U.S. total: rose 101.6% over the same period.
2010–2024 increases: DC 26.4%, Maryland 24.7%, Pennsylvania 39.9%, Connecticut 49.4%, Massachusetts 101.2%, Illinois 37.8%, Ohio 41.4%.
Data-center load: DOE/LBNL reports U.S. data centers used 58 TWh in 2014, 176 TWh in 2023, and are projected at 325–580 TWh by 2028.
PJM capacity pressure: reports cite PJM capacity prices moving from $28.92/MW-day to $269.92/MW-day, later hitting a $333.44/MW-day price cap.

Why this matters

Deregulation did not eliminate regulation. It fragmented the old public-utility model: supply, delivery, transmission, capacity, taxes, and public-policy charges now move through different systems. PEPCO customers still depend on monopoly wires, but regional PJM capacity and transmission costs can affect bills.

Datacenters add a new, tremendous stress point. Large, fast-growing loads require generation, transmission, substations, and capacity commitments. The policy question is simple:

Who pays for grid expansion driven by hyperscale data-center load — the data centers, or ordinary captive ratepayers?

Bottom line

The historical price increase in DC and Maryland is far above 18% in nominal EIA data. The next major risk is that data-center-driven PJM capacity and grid costs may be socialized across ordinary customers unless regulators require strict cost allocation.

Maryland Power Gouge – From 7 cents in Y2K to 19 cents and Beyond