Montgomery County on Tuesday filed a brief opposing a proposed Pepco rate increase with the state’s Public Service Commission.
Pepco, the electric company that serves most of Montgomery and has come under fire for reliability problems, in December filed a $60.8 million rate request with the PSC that would raise the average monthly bill of residential customers by $7.13.
Pepco also requested a “grid resiliency charge” that it claims would help it replace and repair its infrastructure. It would cost the typical residential customer in Maryland about $1 a month in 2014, then $1.70 a month in 2015 and just less than $2 by 2016.
Montgomery County, in the brief filed by Deputy County Attorney John P. Markovs and Assistant County Attorney Lisa Brennan, argued the grid resiliency charge should be rejected on the basis that the PSC historically rejects surcharges “that are related to advance recovery of projected capital costs from ratepayers.”
In October, Gov. Martin O’Malley (D) endorsed a plan that would allow for surcharges in advance of major maintenance upgrades in exchange for stricter reliability standards.
Montgomery also proposed a revenue requirement for Pepco of $6.5 million, a 90-percent reduction of Pepco’s $60.8 million rate request.
The county also claimed Pepco has not filed its tax returns for 2012 and 2013, meaning Pepco’s Accumulated Deferred Income Taxes, “is not a loss that has actually been incurred, but is merely forecasted.” The county argues that means the PSC should remove $66 million in Pepco’s Net Operating Loss Carryforward from the rate base.
The PSC is expected to rule on Pepco’s request this month. The utility was subject to harsh criticism for its performance after a major storm hit the area late last June. The PSC rejected most of Pepco’s requested $68 million rate increase in August, granting it $18 million.
Most County Council members came out against the rate request when it was proposed.
PDF: Montgomery County Pepco PSC Filing
Flickr photo by Bill in DC
