The Virginia Electric and Power Co.'s rates in the last five years have gone up nearly twice as fast as the electricity rates charged by the two other major utility companies in the Washington area.
Vepco, which this week asked for a 12.2 percent rate increase, charged the average residential customer about $23 a month in 1973. By last month, the same amount of electricity cost about $44. Vepco does not, however have the righest rates in the metropolitan area.
In Virginia the average Vepco customer uses about 1,000 kilowatt hours of electricty a month, far more than consumers in the District of Columbia or Maryland. A kilowatt hour is the amount of energy it takes to burn 10 100-watt light bulbs for one hour.
A survey of rates charged by Vepco Potomac Electric Power Co. and Baltimore Gas & Electric Co. shows that while Vepco's rates have increased by 91 percent in the past five years, customers of all three companies pay roughly the same price for each kilowatt hour of electricity they use. Vepco charges 4.4 cents per kilowatt hour, BG&E, 4.8 cents and Pepco between 3.5 and 4.5 cents.
Vepco's rates in 1973 were considerably lower than those charged by Pepco, which serves customers in the District of Columbia, surburban Maryland and Virginia, and by BG&E, which serves Maryland.
Vepco bases its monthly charge on a sliding scale determined by the amount of electricity consumed. Therefore, the rates cited in this story may be slightly higher or lower than actual rates charged.
Vepco's rates have almost doubled, according to William Berry, the company's executive vice president because of sharp increases in the price of oil and coal and because of the company's large investments in nuclear generating plants.
"Every new plant we build has a higher cost than its predecessor. The more you build, the more prices are pushed up," Berry said. He said that Vepco, which is the eighth largest electric utility in the nation, is in a high growth area and is forced to build to keep pace with demand.
Rates charged by Pepco in Maryland over the past five years have gone up about 55 percent. In the District, where residential rates have been closely regulated over the past five years, the Pepco increase is about 21 per cent. BG&E has increased its rates over the same period by about 45 percent.
Customers of these two utilities use an average of between one-half and two-thirds of the 1,000 kilowatt hours per month consumed by Vepco's Northern Virginia customers. Not surprisingly, their electric bills are much lower.
The reason for high electricity consumption in Virginia, according to lawyer John T. Schell, who has represented consumer groups in challenges of Vepco rate increase requests since 1972, is the greater number of all-electric homes in Virginia compared to the District and Maryland. Schell said the higher consumption can also be attributed to a higher number of electrical appliances and relatively higher incomes.
In an interview with The Washington Post in January, T. Justin Moore Jr., Vepco's chief executive officer, said his company made a mistake by failing to request rate increases early enough in the wake of soaring oilprices in the early 1970s. That helps explain why Vepco's 1973 electric rates were lower than other Washington-area utilities.
Schell said that Vepco's four rate increases since 1973 more than make up for the company's hesitance in the early 1970s to ask the Virginia State Corporation Commission for higher rates.
Schell said he is not surprised that tthe three Washington area utility companies have all raised their rates to about the same level. "Their managements have a similar approach - the higher cost approach," Schell said.
As many consumer advocates have complained in recent years, Schell said Washington-area utilities emphasize new construction of generating plants over conservation programs that could eliminate the peak power demands the new plants are built to meet.
Concerning Vepco's pending rate increase request, Schell said that Vepco's troubles with the Nuclear Regulatory Commission in construction disputes at the North Anna nuclear plant have caused expensive delays for which Vepco is responsible and for which Vepco's customers are paying.
Vepco vice president Berry said that responsibility for delays at the North Anna plant "rests on many shoulders. We have done everyting we can possibly do (to speed construction)." Berry said the delays were primarily "regulatory and bureaucratic."
Berry said that Vepco was "on the horns of a dilemma" in regard to the choice between conservation and building to accommodate the area's growing energy needs.