Credit: Darrow Montgomery

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Electric company Pepco-Exelon is asking D.C. regulators to permit a combined ratepayer increase of $85 million, or approximately $4.36 per customer per month, in new papers filed to the D.C. Public Service Commission on Thursday.

According to the company, the higher rates wouldn’t take effect until 2019 if the PSC grants a $25.6 million credit and a $1 million yearly incremental offset to District customers—a term it and officials agreed on during negotiations over the merger of Pepco and Exelon earlier this year. The requested hike would represent a roughly five percent raise on top of current charges, the firm adds, its first since March 2013. But corporate watchdogs claim the way in which the merger was handled casts doubt onto the PSC’s ability to process the case; some seek to challenge the deal in appeals court.

“[The PSC] should limit the Pepco/Exelon request to the mere requirements of the law,” said Christina Harper, a spokeswoman for Mayor Muriel Bowser, in a statement. “And they must apply the $25.4 million that Mayor Bowser negotiated, and they redirected, toward shielding D.C. residential ratepayers from any increase for three years. To do otherwise would be to the detriment of D.C. residents.”

A representative for the PSC hasn’t returned a request for comment. Pepco President Donna Cooper told the Post that the solicited increase is needed to make up for the hundreds of millions of dollars it’s spent over the past few years to improve electricity infrastructure. Today, the average D.C. ratepayer monthly bill is a little north of $80, the Post reports.

“This case is driven by on-going investments on behalf of Pepco’s customers,” the firm’s request explains. “Specifically, Pepco has continued to invest in its system to maintain and improve reliability and to serve load growth in the District of Columbia. Pepco’s revenue growth has not kept pace with the resulting growth in operating costs and rate base, and the current rates do not allow Pepco a reasonable opportunity to recover its costs and earn a fair return.”

But Sandra Mattavous-Frye, the head of D.C.’s Office of the People’s Counsel, said in a statement that the PSC’s order to approve the Pepco-Exelon merger raises eyebrows about whether the commission will also grant protections for customers. Pepco has garnered approximately $100 million based on four rate increases since 2006, she added.

“OPC will be vigilant in examining this monumental filing to ensure that any rate increase is based only on the expenses necessary to keep the lights on and not those associated with Exelon’s lengthy journey to merge with Pepco,” Mattavous-Frye said. “It is alarming that the cost of living and housing trends in the District unfortunately have widened the gap between the haves and the have nots.” Meanwhile, OPC is monitoring the firm’s merger compliance.

The commission likely won’t decide the case for several months. Pepco-Exelon says the rate hike would ultimately “enable [it] to maintain its investment-grade ratings on securities and to compete for capital on more favorable terms.”

You can read the company’s filing here.

Update, 5:00 p.m.: Ward 3 Councilmember Mary Cheh and At-Large Councilmember Elissa Silverman, who together opposed the merger of Pepco and Exelon, criticized the company’s request for higher power rates in a joint statement:

“No sooner does the ink dry on the merger then Pepco issues a request for District residents to pay the largest single rate increase in decades. We predicted that this would happen and now it has come to pass in the District as it has in other jurisdictions bound to Exelon. We can only hope that the Public Service Commission will push back against this exorbitant request and limit it to the barest increase it can justify. The Office of the People’s Counsel’s new Merger Compliance Team should act as a vigilant watchdog. This recent action underscores the need to study a public-power option and pursue sustainable, alternative energy sources in the District of Columbia.”