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Pepco Puts In Request For Another Rate Increase

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The utility has been the subject of criticism due to slow outage response times.
Markette Smith
The utility has been the subject of criticism due to slow outage response times.

Pepco is asking Maryland regulators for another rate increase, filing a rate hike request today with the Maryland Public Service Commission. The utility is seeking an additional $43 million. 

Pepco Region President Donna Cooper says the average customer would have to pay about $4.80 more per month or about 16 cents a day.

Pepco says it needs the money to pay for the upgrades it has made since 2010 to improve its reliability after a series of thunderstorms that summer left thousands of customers without power for up to and over a week. 

"Significant capital is needed to maintain and upgrade the system," Cooper says. "Therefore the company requires this rate increase to pay for those investments.  And this is in the best interest of our customers."

The utility says that, since then, the number and length of outages has dropped roughly 40 percent.

But critics say Pepco was among the worst in both categories nationwide in 2010, and its improvement was easy to achieve considering how poorly the utility was peforming then.

In a statement, Montgomery County councilman Roger Berliner says he expects the Maryland Public Service Commission to reduce Pepco's request when it makes a decision in July. In particular, Berliner is upset that Pepco would use some of the money from the rate hike to increase the return on equity for shareholders by roughly one percent. 

He says that while Pepco has improved, it still ranks in the bottom half nationally in utility performance, which Berliner believes is not good enough to merit shareholders making more money from a rate hike.

A decision from the Public Service Commission is expected in July. The commission approved a partial rate hike in Maryland earlier this year.

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