Kennedy, K.M., S. Vo, K. Vangelov, B. Buddi, S. Smith, J. Lou, R. Cui, and N. Hultman (2024). “The Renewable Energy Transition in Maryland: Implications for Energy Generating Facilities and Small Businesses.” Center for Global Sustainability, University of Maryland. 50 pp.
Policy recommendations for small businesses include:
- Supporting small businesses through funding and financing. Maryland should support small businesses by providing access to funding and helping them navigate and utilize existing resources. Financial mechanisms such as green banks can play a critical role by leveraging public and private capital to offer low-interests loans for clean energy projects.
- Creating processes for engagement and technical assistance. Maryland should establish mechanisms for sustained engagement and technical assistance, supporting affected small businesses through the processes of needs assessments, funding applications, and project implementation for the energy transition.
Policy recommendations for energy generating facilities include:
- Achieving Maryland’s climate goals. Maryland should rapidly reduce emissions from both imported electricity and in-state generation, prioritizing phase-out of unabated fossil fuel generation to achieve air quality and health benefits. These considerations will be important as the state develops a clean energy standard.
- Developing a framework for facility closures. Maryland should develop a more comprehensive framework for facility closures that ensures grid reliability and addresses the broader challenges and opportunities of the energy transition. This framework should go beyond just financial and reliability concerns, considering social, economic, and environmental impacts. Such a framework will require working closely with PJM to ensure coordination with regional grid operations.
- Leveraging funding at the federal and state level. Maryland should support businesses, communities, and local governments by helping them leverage federal Inflation Reduction Act programs and tax credits while providing state-level financial and technical assistance to prioritize impacted communities.
- Bolstering stakeholder engagement. Maryland should design tailored engagement strategies, as each facility closure and community will require context-specific solutions. This engagement should include local stakeholders such as plant owners, utilities, communities, local governments, and regional stakeholders like PJM to foster collaboration and ensure community-centered approaches.
Executive Summary
The continued output of environmentally damaging greenhouse gas (GHG) emissions drives global temperature rise and has created significant climate-related challenges across the United States. These challenges are evidenced by increasing weather-related disasters like Hurricane Helene. In response to the growing climate crisis, the State of Maryland enacted the Climate Solutions Now Act (CSNA) of 2022, which set the goal of reducing state-wide GHG emissions by 60% by 2031, relative to 2006 levels. The CSNA also set a further goal of achieving net-zero GHG emissions by 2045. The state’s 2023 Climate Pollution Reduction Plan later detailed that Maryland must pursue a rapid clean energy transition to reduce GHG emissions across all sectors to meet these climate goals.
As part of this effort, the Energy Industry Working Group under the Maryland Commission on Climate Change was charged with producing a report on the impact of the energy transition on small businesses and existing power facilities throughout the state. Small businesses and energy facilities are key partners in implementing the clean energy transition, and in instituting an all-society approach to achieving the state’s emission reduction goals where no one is left behind. This report is in fulfillment of the CSNA requirement to assess how the energy transition will affect small businesses and energy-generating facilities in Maryland. It outlines the potential positive and negative effects of the clean energy transition, assessing the potential for different opportunities and challenges throughout the state. The report also outlines opportunities to create policies that are productive and beneficial throughout the energy transition process.
To that end, the report examines the current and potential energy transition policies and actions within the state. It analyzes which small businesses may experience the greatest impacts in the energy transition and describes the positive and negative ways those impacts may be felt. It provides recommendations on funding and financing for small businesses, as well as engagement and technical assistance to support these businesses through the transition. The report also highlights criteria that influence the pathways of energy facilities in the transition and develops options for facilities to take while considering the effects on employment, health, and equity. The report also provides recommendations to the State of Maryland on how to support these key actors while ensuring a just transition for energy facilities. Finally, the report discusses several case studies of small businesses and energy facilities in Maryland to contextualize the analysis.