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Pepco’s Historic Plan to Change Ratemaking
On April 13, 2023, Pepco filed an application with the PSC for a multiyear rate plan (MYP), seeking to increase electric rates for D.C. customers by $186.5 million over three years. OPC opposes this plan, considering it unreasonable and burdensome for consumers.
The MYP represents a significant shift from traditional rate-setting methods. Under this plan, which OPC believes could harm District residential consumers, they would bear 43% of the rate increase, the largest share among customer groups.
Pepco justifies this disproportionate burden on residential customers by citing historical revenue deficiencies compared with business and commercial consumers.
The Commission required Pepco to file testimony on lessons learned from a previous MYP pilot, which ended in December 2022 with a $108.6 million rate increase. Additionally, Pepco was asked to submit a traditional test year filing, which they did on October 16, 2024, requesting a $108.2 million rate increase.
On July 30, 2024, the Commission held a legislative-style hearing, but, for the first time, declined to hold an evidentiary hearing. OPC opposes this decision, arguing that consumers deserve to have their voices heard under the longtime, traditional platform. As of this writing, OPC awaits the Commission’s decision on a rate increase, hoping for a just, fair, and reasonable outcome.