The OPC Connection – January 2021
A Note from Your People’s Counsel Sandra Mattavous-Frye
Empowering People through the Pandemic
In this space in the January 2020 OPC Connection, I covered the status of proposals by Pepco and Washington Gas to significantly raise their rates. I won’t rehash the details of the rate increase cases, which still have not come to a close, because they’ve been the subject of numerous OPC Connection updates. I assure you, however, that over the past 12 months, OPC has continued to press for fair and reasonable rates in both cases, as we’ve worked through the COVID-19 pandemic to advocate, educate and protect electric and natural gas consumers.
You might recall that in January 2020, the coronavirus was just surfacing but had not yet wreaked havoc on the health, livelihood, and utility bills of countless District households. Now, as January 2021 comes to a close, there is still uncertainty over when there will be a recovery, even as many are hopeful of better times ahead, given the change on the national political front.
What has not changed over the past year is OPC’s readiness and capability to serve, with staff addressing consumers’ needs remotely. Take the case of an elderly Ward 7 resident who OPC helped to get the assistance she needed to pay utility bills and repair her broken HVAC system. By making the case that utility bills would spiral out of control as consumers used more energy at home, OPC also was successful in getting lawmakers to approve relief measures. We continue to have substantive discussions with Councilmembers on legislation to protect consumers once the moratorium on disconnections is lifted. In addition, OPC staffers have been busy in the virtual space, “attending” community meetings across all eight wards to make consumers aware of bill payment assistance programs they should explore right now.
These developments and other OPC accomplishments are cited in the 2019-2020 OPC Annual Report: “Empowering People through the Pandemic.” I invite you to “read all about it,” by clicking on the report cover
“Make a plan. Pay what you can to keep utility costs under control.” That’s the message of #Here2HelpDC, a joint initiative of the Office of the People’s Counsel, the DC Sustainable Energy Utility, the DC Public Service Commission, and the District Department of Energy & Environment. Now, by going to here2helpdc.dc.gov, utility consumers can find resources OPC and the other agencies can provide to help residents and businesses minimize the negative impacts of the pandemic.
In the wake of COVID-19, the agencies joined forces to create #Here2HelpDC, a public awareness campaign to highlight bill payment assistance, and energy and money-saving programs. Thanks to the Office of the Deputy Mayor for Operations and Infrastructure, consumers also can find utility resources on coronavirus.dc.gov.
OPC Advocates for DC Water Consumers at Public Hearing on New Relief Program
On January 13, the DC Water Board held a public hearing on its “DC Water Cares” Emergency Residential Relief Program. The Board informed the public it has approved $8 million in new water assistance over two years beginning in Fiscal Year 2021. OPC welcomes the proposed relief as a positive development for consumers facing the economic challenges resulting from the pandemic. According to DC Water, in November 2020, there were 14,733 delinquent cases, an increase of 9,933 cases since March 2020.
OPC Assistant People’s Counsel Grace Soderberg testified at the hearing. She commented that DC Water should work with community-based organizations to inform the public about water assistance programs. OPC also urges DC Water to provide monthly arrearage (debt) data to OPC in order for OPC to evaluate the effectiveness of aid programs. Read the full testimony here.
A moratorium on water service disconnections continues under the public health emergency. However, consumers are still responsible for paying their bill during the pandemic. OPC encourages consumers to take advantage of assistance programs now. Highlights are below:
- Customer Assistance Program (CAP) reduces the Clean Rivers Impervious Area Charge/CRIAC for eligible customers between $15 and $77 a month.
- Emergency Relief Program provides up to $2,000 in emergency assistance for overdue balances related to COVID-19.
- Eligible customers cannot exceed 80% Area Median Income.(About $100,000 of annual income for a family of 4)
OPC’s Water Services Division also can answer your questions at (202) 727- 3071.
Pictured clockwise from top left: DC Water Board Chairman Tommy Wells, OPC Assistant People’s Counsel Grace Soderberg, and DC Water Board Members Anthony Giancola and Howard Gibbs.
What’s on the Horizon for the Solar Investment Tax Credit?
The solar industry has seen significant growth since the launching of the federal Solar Investment Tax Credit (ITC) in 2006. This federal policy provided one of the major incentives, along with local government renewable energy goals, that arguably encouraged and supported the tremendous growth of solar energy in the United States; boosting job creation and growth with billions of dollars invested in the U.S. economy as a result.
For now, the ITC offers both a residential and a commercial solar tax credit. Congress in 2020 passed a mid-year extension of the ITC with guidance from the Internal Revenue Service. The residential ITC offers a 26% federal tax credit for the cost of solar projects that began construction in 2020 and 22% for the cost of projects with construction starting in 2021. However, after December 31, 2021, the residential ITC will no longer be available.
Commercial solar projects, including utility-scale projects that began construction prior to December 31, 2021 can utilize a 30%, 26% or 22% ITC on the cost of a projects if those projects are in service before December 31, 2023, subject to IRS guidelines. The commercial ITC drops to a fixed 10% in 2024.
The extension of the solar investment credit in the commercial sectorsignals an ongoing healthy and robust U.S. solar energy market despite the pandemic
Your electric bill has two primary costs, retail and wholesale. Your retail costs are based on what it cost for Pepco or your alternative energy provider to bring electricity to your home or business. Wholesale costs are the expenses Pepco incurs in purchasing the electricity and bringing it to the District. On average, wholesale costs comprise two-thirds of your electric bill, so OPC’s advocacy in the wholesale markets is critical to keeping your electric bill down.
There are two organizations that govern the wholesale markets. The first is PJM, which operates the largest organized market in the world encompassing 13 states and the District, and stretching from New Jersey to Chicago and Pennsylvania to Tennessee. PJM historically stands for Pennsylvania/Jersey/Maryland based on its origin. The organization is part commodity market and part traffic cop. That means PJM operates markets where utilities and energy generators buy and sell electricity, and then manages the flow of power across transmission lines from where it is generated to where it is used. OPC is a member of PJM and participates in stakeholder meetings, working with other consumer advocates, utilities, generators, and others to ensure reliable, cost-effective, and sustainable electricity is available to District consumers.
The Federal Energy Regulatory Commission or FERC serves as the primary regulator of the wholesale markets. An independent federal regulatory agency, FERC has five commissioners nominated by the President with no more than three from either political party. Among other things, FERC reviews PJM’s markets to ensure consumer and commercial interests are balanced and that electric rates are “just and reasonable.” OPC attorneys play an active role in FERC legal proceedings, and regularly meet with FERC commissioners and staff about issues important to District consumers.
Meet Erik Heinle
OPC is pleased to share that PJM Members recently elected Assistant People’s Counsel Frederick “Erik” Heinle as Vice Chairman of PJM’s Members Committee. The Members Committee provides advice and recommendations to PJM on all matters relating to the safe and reliable operation of the PJM electric grid, the creation and operation of a robust, competitive and non-discriminatory electric power market, and ensuring there is no undue influence over PJM’s operations by any member or group. As part of his responsibilities, Erik also will serve as Chairman of the Liaison Committee, which facilities interaction between PJM Members and the PJM Board of Managers. (In case you missed it, read Erik’s article above to learn more about PJM.)
Erik is originally from Pittsburgh and is a graduate of Colgate University and the University of Virginia. A self-proclaimed “energy geek,” Erik came to OPC in 2017, full of experience practicing before the Federal Energy Regulatory Commission. Since coming on board, Erik says one of his goals has been to ensure underserved DC communities have access to renewable energy resources. He has been an invaluable asset to OPC, working to ensure federal decisions and initiatives are in the best interest of District utility consumers. We congratulate Erik on his new role with PJM.
OPC is advocating for consumers in the following cases:
RM36-2020-02-E, Electricity Quality of Service Standards
On December 18, 2020, OPC filed comments in this Rulemaking. In 2011, the PSC adopted Electricity Quality of Service Standards (EQSS), which led to substantial improvement in system reliability. The EQSS performance standards, coupled with the commitments made in the Pepco/Exelon merger (Formal Case No. 1119), provided fixed targets for Pepco to strive for each year. While the EQSS is commendable, OPC believes that further improvements to reliability must also be focused on both affordability of service and promoting equitable service, as there is a tradeoff between the cost needed to improve performance and ratepayers ability/willingness to pay. In addition, there are several wards in the District that continue to receive subpar service compared to other wards.
Formal Case No. 1156: Pepco’s Application to Implement a Multiyear Rate Plan for Electric Distribution
On December 23, 2020, OPC filed a Reply Brief, addressing the Initial Briefs filed by Pepco and other parties concerning Pepco’s requests to implement a multiyear rate plan (MRP) and increase Pepco’s electric distribution rates by at least $135.9 million. OPC proposed that given the extraordinary and ongoing uncertainties facing ratepayers and the District’s economy, the Commission should (at most) grant limited rate relief now, impose measures to mitigate the impact of the increase upon ratepayers, and reject Pepco’s proposed MRPs.
Formal Case No. 1154: WGL’s Application for Approval of PROJECTpipes 2 Plan
On January 11, 2021, OPC filed a Motion for Reconsideration, Clarification and/or Modification of Order 20671 which granted in part and denied in part Washington Gas Light Company’s Application for the PROJECTpipes 2 Plan, subject to conditions. OPC requests that the Commission grant reconsideration of Order No. 20671, and: (1) reinstate the OPTIMAIN top three requirements;and/or require a program focused on replacement of small-diameter cast-iron main; (2) explicitly direct that costs to replace mercury service regulators shall not be recovered through the PROJECTpipes surcharge mechanism; and (3) clarify that the company’s Climate Business Plan remains subject to review in Formal Case No. 1167 and that until a Climate Business Plan has been fully vetted and approved by the Commission, WGL does not have permission to incorporate into a successor PROJECTpipes proposal, steps for implementation of the Climate Business Plan.
During the COVID-19 crisis, OPC welcomes the opportunity to speak at your Advisory Neighborhood Commission, civic association or community group meeting. We can give updates on utility issues and tell how we are continuing to serve during the pandemic via telework. Call (202) 727-3071 if your group would like our staff to “zoom in.”
Each year, OPC staff members give individual donations to a charity during the holiday season. This year, we were pleased to send the donations to the@TheTraRonCenter, a nonprofit organization that supports children who are survivors of gun violence in Southeast. Thanks, TraRon kids for the Twitter shoutout!