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Pepco Files for Rate Increase to Support Reliability and Service Enhancements in the District of Columbia

Washington, D.C. (June 30, 2016) - Pepco today filed a rate increase with the Public Service Commission of the District of Columbia (PSC) to recover the costs of reliability and infrastructure upgrades that have reduced the number and length of power outages, while delivering improved service to its customers in the District. It has been three years since Pepco last requested a rate increase from the Commission.

Under the proposed rate increase, the bill for the typical residential customer in the District would increase by $4.36 per month. With this increase, the average residential bill will still be lower than it was five years ago due to lower electricity supply costs.  

As part of its merger commitments, Exelon will contribute $25.6 million to Pepco customers in the District to offset the proposed increase. Pepco has proposed that the entire amount be applied to residential and master metered apartment customers. If approved, these customers will not see an increase in their distribution rates until at least January 2019, assuming rates take effect in July 2017. The merger commitments also included a one-time $54 per residential customer credit, totaling $14 million, which Exelon provided to customers in April.

"We realize that a rate increase has a direct impact to our customers and so we will continue to work with our customers to identify ways to reduce their energy usage and manage their bills," said Donna Cooper, Pepco region president. "The reliability and infrastructure upgrades that we have made have reduced the number and length of power outages, while delivering improved service to our valued customers." 

During the past three years, Pepco has spent more than $658 million to strengthen and modernize the District's electric distribution system. As a result, Pepco's District reliability performance exceeded PSC service standards from 2013 to 2015. Compared with 2011, customers last year experienced 42 percent fewer power outages and 33 percent shorter outages. Moreover, under the terms of the merger, Pepco is committed to making even more improvements to reliability between now and 2020.

Pepco has a variety of programs to help customers manage their energy bills, including budget billing, extended payment plans, and other programs. Low-income customers who qualify for Pepco's Residential Aid Discount (RAD) do not pay for distribution charges and are not impacted from the proposed increase.  Customers also can enroll in "My Account," and download the mobile app to get immediate information on their bill, the status of outages and easy ways to reduce consumption. Also, Pepco's Energy Wise Rewards program pays customers who enroll to reduce their electricity use during peak demand periods. 

Pepco's rates are set by the PSC, an independent body that regulates utilities in the District.  The PSC conducts a rigorous, judicial-like process that reviews Pepco's expenditures and considers input from all interested parties, including the Office of the People's Counsel. Through this public process, the PSC determines the amount of the rate adjustment. The process can take up to a year to complete, which means the proposed rate adjustment will not take effect until summer 2017.  

Pepco's last delivery rate adjustment in the District was filed in 2013 and took effect in 2014. Delivery rates cover the cost of the poles, wires and other equipment that carry electricity to customers' homes and businesses, the cost of staff for customer service and for preparing and processing customers' bills. Delivery rates are separate from electricity supply rates, which pay for the electricity itself.

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