What Is a Maryland Electricity and Natural Gas Supplier Bond?
The Maryland Public Service Commission requires electricity and natural gas suppliers, brokers and aggregators to be bonded. Under the bond contract, suppliers are obligated to pay all taxes, penalties and interest due to the State of Maryland and comply with the provisions of Title 40, Chapter 23, Article 1. The surety protects the state and the public by ensuring owed funds are available if a supplier defaults.
If you are a subscriber organization applying for authorization to participate in the Community Solar Energy Generating System (CSEGS) Pilot Program, visit our Maryland CSEGS bond page to apply.
How Much Do Maryland Electricity and Natural Gas Supplier Bonds Cost?
Maryland electricity and natural gas suppliers must purchase a $10,000 bond policy. Premiums start as low as $100 for qualified applicants with strong credit and audited financials. You can save 25% each additional year if you select a multi-year term.
If you are applying to become a natural gas supplier but are insolvent or unable to meet the financial obligations required by the Commission, you must file a $250,000 financial integrity bond form. Prices start at $5,000 for the $250,000 natural gas supplier bond. Apply now for a free, personalized quote.
How Does a Maryland Electricity and Natural Gas Supplier Bond Work?
An Maryland electricity broker/aggregator bond joins three parties in a legally-binding contract:
- Principal: The electricity and natural gas supplier/broker/aggregator
- Obligee: The Maryland Public Service Division (PSD)
- Surety: The surety bond provider
The obligee (PSD) requires the bond from the principal (electricity supplier) and the surety backs the principal’s obligation. If the bonded principal fails to pay their energy tax liabilities to the state, the bond acts as a line of credit to pay the obligee. However, the principal must reimburse the surety for any claims.
Who Needs an Electricity and Natural Gas Supplier Bond in Maryland?
Electricity suppliers, brokers and aggregators in Maryland must submit a $10,000 surety bond to be licensed. The bond is only required if you will not take title to electricity.
If you plan to accept deposits or prepayment from customers, you may need a separate bond form to cover the value of anticipated prepaid funds.
Finally, if you are becoming a licensed electricity or natural gas supplier but do not meet the audited financial statement requirements, you must file a $250,000 financial integrity bond.
How Do I Get an Electricity and Natural Gas Supplier Bond in Maryland?
SuretyBonds.com provides the fastest and easiest way to get your Maryland electricity and natural gas supplier bond.
- Bond Amount: Select your bond amount to start your online application
- License Type: Select your supplier license type: gas, electric, or both
- Information: Submit personal, company and owner information
- Quote: Get a free quote within one business day or less
- Purchase: Checkout through our secure, online portal
- Sign: Complete DocuSign e-verification for the bond indemnity agreement
We’ll mail your physical bond form for you to file with the commission. Select next-day shipping if you’re in a rush.
Do I Need to Renew My Bond?
Electrical and natural gas supplier bonds require annual renewal to maintain licensure. Be sure to renew your bond before it expires to avoid a lapse in coverage.
A SuretyBonds.com account representative will contact you during the renewal period. All you need to do is pay your renewal invoice to maintain an active bond policy.
How to Get a Gas Supplier License in Maryland
To become a natural gas and electricity supplier, broker, or aggregator, you must apply with the Maryland Public Service Commission and submit the following materials:
- Application form
- Certificate of good standing from state of formation and/or the state of Maryland
- Statement of technical and managerial competency (including resumes, description of operations and business plan)
- Sales training materials and marketing collateral that you intend to use
- Audited, current financials: balance sheet, income statement, credit reports and long-term bond rating*
- $10,000 surety bond for electric brokers and/or aggregators
- $50,000 deposit or prepayment bond (if you intend to accept prepayments or deposits from customers)
- $400 license fee made payable to “Public Service Commission”
*If you don’t meet the financial requirements, you must file a $250,000 financial integrity natural gas supplier bond rather than the $10,000 bond.
Mail a signed and verified original copy of your application plus copies to the Commission at the address below:
Executive Secretary
Maryland Public Service Commission
6 Saint Paul St.
Baltimore, MD 21202
Also send one copy of the application to:
The Office of People’s Counsel
6 Saint Paul St.
Baltimore, MD 21202
It typically takes about 45 days for the Commission to review and approve license applications. If you have any questions, call the Energy Planning and Analysis Division of the Public Service Commission at (410) 767-8085.
