The Maryland Public Service Commission on April 30 accepted revised standard offer service (SOS) base rates filed by Southern Maryland Electric Cooperative (SMECO), with an effective date of June 1, 2025.

Staff told the commission that SMECO filed the revised base SOS rates on March 31, 2025 under the settlement in commission order 79503, which requires a reset of base SOS rates when the power purchase cost adjustment for residential customers exceeds 5% of residential SOS rates for three consecutive months. Staff said the revised rates reflect rising costs for capacity and transmission and recommended the commission accept the proposed tariff pages for filing with an effective date of June 1, 2025.

Staff said the filing proposes residential energy rate increases of about 21% in summer months and about 24% in winter months. Staff provided a concrete example for residential usage of 1,000 kilowatt-hours per month: an expected bill increase of $18.30 in the summer and $20.60 in the winter. Staff concluded the revised tariff pages comply with order 79503 and recommended acceptance.

Representatives of SMECO told commissioners their procurement approach differs from investor-owned utilities. Dean Bradford, vice president for rates and tariffs at SMECO, said the cooperative maintains a managed portfolio with long-term power purchase agreements and bilateral contracts to hedge supply. "For the 2025-26 delivery year, we have hedging in place, which has mitigated to some extent, to the tune of about $20,000,000 a reduction in cost that we otherwise would have seen," Bradford said.

Damon Crager, speaking for SMECO, said the cooperative posts pending tariff filings on its website and uses member publications and social media to alert members; he said the company typically waits for a final commission action before broader communications so the messages do not change after filing. SMECO staff also said some hedging details and parts of the PPCA filings are confidential but that confidential materials are filed in the PPCA docket and available to commission staff for review.

Commissioners asked about SMECO's participation in auction-based procurement and inquired whether any elements of SMECO's approach might be useful for the commission to examine comparatively. SMECO representatives said the cooperative does not participate in the auction process used by some utilities and that their longer-term, blended purchasing strategy provides smoothing benefits for members.

Commissioner Linton moved to accept the tariff provisions for filing with an effective date of June 1, 2025; Commissioners Sussman and Richard voted aye, and the chair cast an aye vote. The motion carried unanimously.

The accepted filing will appear in the commission docket for the SOS base rate reset called out in order 79503; staff and SMECO noted the PPCA and hedging plan are subject to annual review before the commission.