Pepco seeks hike in D.C. delivery rates

Washington, D.C., Dec. 12, 2006 — Pepco asked the D.C. Public Service Commission (PSC) to authorize an increase in electricity distribution rates in the District of Columbia. If approved, the change would add about 7.79 percent to monthly residential electric bills. The typical bill for a Standard Offer Service residential customer using 750 kilowatt-hours a month would increase $5.97, from $76.64 to $82.61.

The proposed increase, a total of $50.5 million, reflects ever increasing costs since the mid-1990s to maintain the poles, wires and critical high-tech equipment of the electric distribution system, says Pepco. The proposed increase also would be used to improve reliability and support investment in new technology to keep pace with growth and increasing customer demand for power.

At the proposed rate levels, Pepco’s distribution rates still would be below the 1995 levels in inflation-adjusted terms, the company said.

“The increase we are requesting now is necessary for us to keep up with inflation and technology improvements necessary to continue to provide quality service for our customers,” said Thomas H. Graham, president of Pepco Region.

Distribution rates are separate from electric supply rates. Supply rates adjust annually to reflect the cost of power that Pepco buys on behalf of its customers who do not contract with an alternative supplier.

Supply costs are driven primarily by the cost of fuel to make electricity and were largely responsible for the increase in supply rates earlier this year for District customers. If approved by the PSC, the new delivery rate for District customers should, under the Commission’s policy, become effective in September 2007.

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