A strange-bedfellows crew of Pepco executives, consumer advocates and utility regulators joined with Mayor Vincent C. Gray Wednesday to cheer a task force’s proposal to spend up to $1 billion to bury many of the city’s most vulnerable power lines to alleviate storm-related outages.
“I think it’s historic that we got together in this way,” Gray (D) said, referring to a provisional agreement between Pepco and city leaders to jointly finance the bulk of the project via a power-bill surcharge. Work could begin within a year, he said.
Amid the back-slapping, however, some details of the plan remained sketchy. Officials said they have identified the 60 “feeders” — high-voltage lines that run from substations into neighborhoods — that would be buried under the task force’s proposal. But they were unable Wednesday to identify specific neighborhoods that would be affected by the work, other than that they would be located in all areas of the city except Wards 1, 2 and 6, which are closest to downtown.
Still, the plan won early plaudits from ratepayer advocates who are frequent skeptics of Pepco’s rate increase proposals and frequent critics of its reliability record.
D.C. People’s Counsel Sandra Mattavous-Frye, a city official who represents Pepco customers in rate cases, said she joined the task force with “a healthy skepticism but an open mind” and was surprised by the outcome.
“I do believe this is a victory for consumers,” she said. “It is a fair and equitable plan that is the result of hard work of all the participants.”
The proposed surcharge, estimated to start at about $1.50 per month for the average household and rise over seven years to $3.25, is “very, very low,” she said.
Herbert Harris Jr., chairman of the D.C. Consumer Utility Board, an advisory group that monitors issues affecting ratepayers, said the proposal represented “a fair outcome to address a long-term problem extending over decades.”
“The public, I think, will be pleased with the thoroughness of it, and the equity of who pays and how those contributions are made,” he said.
Early in the task force’s work, Harris said, Pepco representatives floated bill figures as high as $30 a month. “They were totally unacceptable,” he said. But the city’s willingness to tap its borrowing capacity helped bring the numbers down.
City budget director Eric Goulet said the $375 million in proposed borrowing would not be counted against the District’s statutory debt cap because the revenue supporting the bonds would not flow through the city’s general fund.
In the wake of last June’s derecho and Hurricane Sandy, Pepco Holdings President and Chief Executive Officer Joseph M. Rigby said that utilities up and down the East Coast have started discussing burying more lines. “The District of Columbia is by leaps and bounds much further in front of this,” he said.
Gray said he expects the D.C. Council to take up legislation enabling the plan as soon as September; the Public Service Commission would have to give its own approval afterward. If all goes smoothly, work could start early in 2014. “It will move as quickly as we can possibly move it,” Gray said,
Legislators gave the proposal generally good reviews Wednesday. Mary M. Cheh (D-Ward 3), who represents upper Northwest neighborhoods that have been among those hardest hit by weather outages, said the proposal had much in common with legislation she introduced last July.
But she said the public should understand that the line-burial proposal will not be a cure-all and that Pepco must also commit to keeping up its infrastructure.
“There are outages that have nothing to do with storms and everything to do with Pepco failing to maintain its equipment,” Cheh said. ”People shouldn’t think the problem of outages is going to be solved by this.”