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Maryland Politics
Posted at 10:30 AM ET, 07/09/2012

Pepco seeks delay in Maryland rate increase decision

Montgomery and Prince George’s residents may have to wait a bit longer to learn whether their electric bills will increase.

Pepco has requested a 4 percent rate hike for its Maryland customers, meaning the average residential bill would increase by $5.50. The Maryland Public Service Commission was expected to announce its decision on the request by this Friday, but Pepco has filed a last-minute request to delay the decision another week.

In a July 3 filing, Peter E. Meier, a Pepco executive, said the commission should push back the decision because of the severe storm
A Pepco contract worker works on a damaged utility pole in Silver Spring, on July 3. (GARY CAMERON - REUTERS)
that hit the Washington region on June 29 and knocked out power for more than 443,000 customers. He wrote that the company and the commission need the extra time to “remain focused on [the] important activities” of restoring power.

“Pepco has been engaged in significant storm restoration activities with the objective to restore electric service to all of its customers as quickly and safely as possible,” he wrote. “Likewise, the Commission and its Staff have been focusing on statewide storm restoration efforts.”

It remains unclear whether the commission will approve the request. Regina Davis, a spokeswoman for the commission, did not immediately return a request for comment Monday; neither did Pepco.

Last week, commission chair Douglas R.M. Nazarian declined to say whether the panel would consider the storm and Pepco’s power restoration efforts as it decides on the rate increase.

“We’re going to decide the rate cases on the record of those cases,” he told reporters in a conference call. But utility companies aren’t required to file reports on how they did over the weekend until early August, about three weeks after the commission needs to decide on the rate hike, he said. He declined to say whether the storm and Pepco’s response is part of the case record.

In response, Montgomery County Executive Isiah Leggett (D) said the commission should consider the storm response when deciding the rate increase.

“I don’t understand that,” Leggett said at a press conference in Silver Spring last week. “I know that you must have clear evidence based on performance and that is judged on results in a crisis situation.”

Montgomery County Council President Roger Berliner (D-Potomac-Bethesda) said he’s not sure whether the commission needs the extra time. He said commission staff members “undoubtedly” have drafted the decision.

“I think they feel that the timing of this rate increase request is particularly unfortunate given the criticism of their work,” Berliner added, referring to Pepco officials. “They are probably trying to get a little more distance between people’s anger and the commission’s decision.”

Council member Hans Riemer (D-At Large) said the commission doesn't need more time. “The commission should say no, and they don’t need to take any more time to consider what part of no is the correct answer,” he said.

Pepco serves nearly 790,000 customers in Maryland. There are currently 108 Pepco customers without power in Montgomery and Prince George’s, according to the company’s Web site. The company added that a majority of the “new outages” were unrelated to the June 29 storm, but it did not specify which of the outages were new.

Pepco also has requested a 5 percent hike for its District customers, meaning an increase of $5 for the average residential bill. The company says both rate increases would provide $111 million a year in additional revenue. District utility regulators have not said when they will decide on the rate hike.

In late 2010, an analysis by The Washington Post found that Pepco customers typically experienced more power outages and waited longer for service to be restored than customers of other big-city U.S. utility companies. The next year, Maryland regulators issued an unprecedented $1 million fine against Pepco, citing the outages and poor tree-trimming practices.

Pepco officials have acknowledged long-standing reliability problems. The company has upgraded equipment, expanded tree trimming and enhanced customer service centers as part of a five-year, multimillion-dollar effort to improve performance.

Local officials have said Pepco’s improved service has largely pleased constituents, but community activists and others in Montgomery County are riled over what they call excessive tree trimming by Pepco contractors. In 2011, Pepco spending for tree trimming along distribution lines was $19 million more than two years earlier, and its contractors have trimmed along more than 3,400 miles of power lines since December 2010.

Berliner and Montgomery County Council member Marc Elrich (D-At Large) have proposed legislation to limit Pepco’s tree trimming by requiring, among other things, that the utility obtain permission from homeowners before pruning on private property.

By  |  10:30 AM ET, 07/09/2012

 
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