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Both Sides Disappointed In Pepco Rate Hike Decision

by Aaron Kraut | July 15, 2013 at 10:25 am | 169 views | 2 Comments

Flickr photo by Bill in DCA state regulator’s decision on Friday to grant Pepco a partial rate increase didn’t make either side happy in the debate over the oft-criticized utility company.

County Councilmember Roger Berliner (D-Bethesda-Chevy Chase) said he was disappointed the Maryland Public Service Commission approved almost half ($27.9 million of a requested $60.8 million) of Pepco’s rate hike request:

“I know that Montgomery County ratepayers share my disappointment in this decision,” Berliner said in a statement. “Our County argued that Pepco should, at best, only receive a 1/10th of what they asked for, not slightly less than half. Our goal remains the same: require Pepco to make significant reliability improvements as soon as possible, and base their financial returns on their performance — not on the dollars they spend.”

A Pepco spokesperson told The Gazette, the $27.9 million is not enough to improve its infrastructure.

“We are very disappointed in the Commission’s decision on our rate adjustment request,” Myra Oppel, told The Gazette. “We will need time to analyze the details before we can provide further comment, but we don’t feel this adequately supports our continued investments to improve service reliability for our customers in Maryland or our plans to respond to the governor’s recommendations to improve grid resiliency.”

The rate increase will mean an additional $2.19 on the monthly bill of average residential customers. The $60.8 million request would have meant an increase of $7.13 a month.

Also part of the PSC approval was $17 million for tree trimming and cutting, $151 million for undergrounding of six feeders and $24 million for a “Priority Feeders” project to “accelerate the hardening of 24 feeders that are prone to outages during major storm events, 12 feeders each in 2014 and 2015,” according to a press release from the PSC. (You can read the full decision here.)

The Priority Feeders project will mean an additional 6 cents on monthly bills in 2014 for average residential customers, an additional 19 cents per month in 2015 and 27 cents per month in 2016.

The PSC said it granted the $24 million for the feeders project on the condition that Pepco provide a detailed description of the work, performance objectives for each feeder project, incremental milestones and estimated costs. Pepco must submit annual filings so the PSC can monitor the progress of the project.

Berliner said Pepco shouldn’t get any money up front for reliability improvements he said the company should be required to provide.

“As a county, we fought hard to stop Pepco from getting automatic trackers (immediate return) for reliability investments –investments we believe Pepco should be required to make to satisfy their fundamental obligation to provide reliable service,” Berliner said. “In this decision, the Commission allowed some trackers, but limited them to a few feeders, which represent approximately 12.5 percent of Pepco’s request.”

Flickr photo by Bill in DC

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  • rorojo

    I am sure Pepco is busily figuring out ways of pocketing this money for profit and executive bonuses. I wonder if they will pay taxes this year.

  • MechanicalTurk

    And power will still continue to go out in some areas after a mild thunderstorm.

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