The Potomac Electric Power Co. opened its drive for a $27 million Maryland rate increase today before a public Service Commission board whose chairman the utility has been trying to get rid of.
Pepco objected to the presence on the panel of commissioner Michael D. Barnes on grounds he is an announced candidate for Congress this year from Maryland's Eighth District. Barnes was also a consumer activist before joining the commission 2 1/2 years ago.
Repco attorney Edward F. Shea also criticized the lack of a commission ruling on Pepco's motion to remove Barnes and to being required to proceed with the rate hearing, all to no avail.
Pepco had filed a request that Barnes either disqualify himself or be replaced because of his congressional candidacy. In its filing, the utility said it was "apprehensive" that Barnes' candidacy would "involve Pepco . . . in a political campaign." Maryland law recognizes that quasijudicial job holders should not seek elective office, the motion said.
Barnes in turn charged Pepco with "highly improper, not to say unethical" conduct. Barnes said Pepco was engaging in "a deliberate, calculated media campaign . . . a conscious effort to discredit a member of the Public Service Commission."
Barnes charged that the utility's officials had called reporters to tell them of the disqualification motion and had also called editors urging them to run the story. Pepco board chairman W. Reid Thompson took "strong exception" to Barnes' allegations and denied any media campaign, saying reporters are routinely called with notice of a public filing. "That is what was done in this case," he said.
Barnes was active in consumer-oriented groups before being appointd to the commission 2 1/2 years ago and has since become known as highly outspoken. Bob Cheeks of the consumer activist Public Power Coalition said Barnes had "certainly been the most responsive member of the commission" to consumer concerns. He suggested that Barnes' consumer-oriented reputation was part of the reason for the Pepco attempt to unseat him.
The commission asked the State Board of Ethics for a ruling on the propriety of Barnes serving on the commission and running for office at the same time and had expected that ruling yesterday. However, the ethics board was unable to muster a quorum and will not decide the issue until next week.
Public Service Commission Chairman Thomas J. Hatem then appointed hearing examiner Kirk J. Emge to serve with Barnes and commissioners William A. Badger and H. Reese Shoemaker Jr. on the Pepco case until the ethics board judgment is received.
After the charges and countercharges died away today, Pepco chairman Thompson said the $27-million rate increase is needed because "the fact is that Pepco has never come up to what is generally considered in the industry as a competitive rate of return," in its investment.
The company managed to achieve "around about" the authorized 9.16 per cent rate of return in Maryland in 1977, he said, but would fall $13.2 million short of that goal this year if rates do not go up. The rate itself ought to be higher, he argued.
Maryland People's Counsel Jack Keane told the commission panel he intended "to shoot Pepco out of the box in this entire rate case." In an interview, he and Montgomery County attorney Gary Alexander said they would question Pepco's accounting procedures, the utility's electricity demand forecasts, and especially the utility's contention that ratepayers and not stockholders should pay for Pepco's abandoned plans to build a nuclear power plant at Douglas Point, Md. The commission ruling on that point may set a precedent in cases pending nationwide on financing of abandoned power plants.