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Pepco to Hold Hearing on Increasing Rates by 5.5 Percent

The Maryland Public Service Commission will hold a public hearing tonight, Wednesday, Aug. 30, to get citizen input on Pepco’s proposed rate increase.

Pepco, which provides electricity to roughly half of Germantown residents has proposed a rate increase, which amounts to a 5.5 percent monthly increase for a typical residential customer. The increase would cost the average residential customer $7.37, or 5.5 percent, more per month. The move to increase rates comes after Pepco spent about $138 million in 2016 and plans to spend $150 million in 2017 on service reliability improvements.

At tonight’s meeting, the Maryland Public Service Commission, which decides whether to allow the rate increase, will hear public testimony.

Montgomery County Council President Roger Berliner plans to submit testimony to the state’s Public Service Commission opposing the latest $68 million rate. According to Berliner, Pepco's request to increase rates by $737 a month is "not justified. No way. No how."

Berliner, who also serves as Chair of the Council’s Transportation, Infrastructure, Energy & Environment Committee, argues that Pepco is requesting a rate of return that is too high, is seeking permission to recover costs of system improvements that have not yet been made, and "most importantly", failed to meet its 2016 reliability commitments that the company agreed to as a condition of approval of its merger with Exelon.

In November 2016, Pepco increased its rates by $52.5 million—about half of the $126 million increase it sought from the Public Service Commission. The 2016 rate increase came after Pepco merged with the Chicago-based utility Exelon in March 2016, a move that made the combined company the largest publicly held utility in the country.

“A deal is a deal. Pepco did not do what it pledged to do and what the PSC ordered it to do. It should face financial consequences for failing to honor its commitment,” Berliner said. “Instead, the company has requested extraordinary rate treatment, rate treatment contrary to fundamental rate-making principles. Pepco is not entitled to extraordinary treatment. Far from it.”

Tonight’s meeting is open to the public and will start at 6:30 pm in the Third Floor Hearing Room of the Montgomery County Council Office Building in Rockville. The Public Service Commission is expected to rule on Pepco’s newest proposed rate hike later this fall.

Photo by Germantown Pulse.