Frustrated with Pepco’s latest request to charge ratepayers more, Gaithersburg officials filed a petition in December opposing the increase and received permission to intervene from the Maryland Public Service Commission Jan. 7.
Pepco filed a case with the Public Service Commission on Dec. 4 for $43.3 million more in base distribution rates, a hike of $4.80 on the average customer bill. This is the company’s third rate increase request since 2011. Pepco is seeking the increase to recover the cost of providing service and to give a fair rate of return on capital to its investors.
City Attorney Lynn Board announced Pepco’s intentions to the City Council at a Dec. 16 meeting. She said the city is concerned about the increased power costs.
Board noted specifically that the rate to power street lights, which is separate from residential unit charges, would increase by 12 percent under Pepco’s proposal, costing the city an additional $24,000 per year.
“That would be a total of an 18 percent rate increase from August 2012, when we last negotiated the rates with Montgomery County, Rockville and Pepco,” she said.
Councilwoman Cathy Drzyzgula said she agreed the city needed to take action.
“I think we do have to take a stand,” she said. “If this is how Pepco’s going to act, then we have to respond.”
The proposed rate increase would take effect July 4.
The commission recently set a hearing schedule for the case, with a plan for hearings to be held on 10 days between April 22 and May 5. At that time, Board will go before the commission to present the city’s arguments.
Public hearings in both Montgomery and Prince George’s counties will also be scheduled so that Pepco customers can ask questions and share their opinions before a final decision is made. The public hearing dates and locations are yet to be announced.
The utility’s request comes less than five months after the Public Service Commission raised the company’s base rates and broke with precedent to grant it the first upfront surcharge in the state. In that case, Pepco was granted $27.9 million of a $60.8 million request for higher rates as well as $24 million of a $192 million surcharge the company asked to levy on top of what customers already pay.
In August, Gaithersburg decided to join Montgomery County in its appeal of that Pepco rate case, The Gazette previously reported.