D.C. Mayor Muriel Bowser
Mayor Muriel Bowser Credit: Darrow Montgomery

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Time is a flat circle at the Public Service Commission. In November, almost exactly two years after Mayor Muriel Bowser nominated former Department of General Services director Greer Gillis for a spot on the obscure three-member body that regulates public utilities, she tapped Lorna John to replace her.

To the frustration of many working to ensure the District meets its renewable energy and sustainability goals, neither Gillis nor John have specific experience in utility regulation, ratemaking, or the energy sector. Gillis had plenty of experience in engineering, and as DGS director, oversaw construction projects. Her lack of pertinent utility experience frustrated only a handful of D.C. councilmembers and she was confirmed by an 8–5 vote in 2018.

John, an attorney, came to the PSC fresh off a mayoral appointment to the Board of Zoning Adjustment, where she weighed in on applications for exceptions from the zoning code. Before that, she was a senior attorney at the Federal Aviation Administration and has worked in several other areas of law including contracts, real estate, immigration, criminal law, and family law, according to her resume. John pitched herself as a hardworking and dedicated public servant who has mastered a variety of complex issues throughout her career.

“Before I joined the FAA, I was neither a pilot nor a mechanic and I was able to talk with experts and understand the information so that I could handle the matters that came before me,” she told the D.C. Council’s Committee on Business and Economic Development during her confirmation hearing last November.

Despite her otherwise impressive resume, John gave a disappointing performance at the hearing. Councilmembers Charles Allen (Ward 6), Mary Cheh (Ward 3), and Kenyan McDuffie (Ward 5), who chairs the committee, peppered John with complicated, jargony questions to test her knowledge about “distributed energy resources” and “interconnection” for solar energy arrays.

John refused to answer with any level of specificity out of concern that she would voice an opinion about an issue that could come before the commission. But she also declined to answer simpler questions: She refused to give her definition of grid modernization, to say whether she believes D.C. can achieve carbon neutrality if regulated utilities are allowed to continue selling fossil fuels, or to suggest ideas for how to help residents struggling with unpaid bills caused by the pandemic.

By December it became clear that John’s nomination did not have the votes to make it out of committee, and Bowser withdrew the nomination, apparently at John’s request. With John’s nomination off the table, Bowser tapped Emile Thompson as her next nominee. He has experience with utility rate setting analysis through his mayoral appointment to DC Water’s board of directors, according to the mayor’s announcement. But the bulk of his professional experience is in criminal justice as a federal prosecutor for the Office of the U.S. Attorney for D.C. Before that, he was an adviser to the deputy mayor for public safety and justice in the Bowser and Vince Gray administrations.

As Thompson awaits his confirmation hearing, many in the solar power sector are holding their breath, but the signal from Bowser has already been received.

“As far as we can tell, she will not put forward candidates that the utility doesn’t think will vote in their favor,” says Anya Schoolman, executive director of the nonprofit Solar United Neighbors. “That’s what’s going on here. It would be great to be proven wrong and see that [the nominee is] a real leader on equitable energy transformation.”

D.C. has committed itself to some of the most ambitious renewable energy goals in the country. The Clean Energy DC Omnibus Amendment Act of 2018 calls for the District to reduce greenhouse gas emissions to 50 percent below 2006 levels by 2032, become carbon neutral by 2050, and achieve 100 percent renewable energy use by 2032. By 2041, 10 percent of that renewable energy must be local solar energy.

The three members of the Public Service Commission are the people standing between D.C.’s utility companies, such as Pepco and Washington Gas, and its residents. The PSC decides when and by how much the utilities can raise rates and sets the rules for how utilities operate. By law, the PSC is required to consider the District’s climate and energy goals in its decisions, a necessary safeguard, some say, considering the utilities’ intransigence.

Questions from councilmembers during John’s confirmation hearing about “interconnection” and “distributed energy resources” offer some examples of this inertia and, solar advocates say, how Pepco is hostile to the private solar market in D.C.

Pepco owns the electric grid—literally the poles and wires. In order to connect a solar installation, a third party—residents or a solar company—has to submit an application to Pepco. The process, known as “interconnection,” is fraught with delays from the utility. And the costs can be unpredictable and opaque, according to David Murray, executive director of the Chesapeake Solar and Storage Association, which represents solar energy companies in the region.

“Some of our installers and project developers have noticed that Pepco can be very slow to authorize this equipment to start providing solar power to the grid,” Murray says. “That has led to lost money, if you’re a business owner, but it also means you’ve got this piece of equipment that’s ready to start generating power [but isn’t].”

He doesn’t want to speculate on why Pepco is slow to approve solar connection to the grid.

“But given how utilities have historically considered distributed energy resources, they may have a financial interest in not achieving our goals,” Murray says. Put another way: The more solar that enters Pepco’s grid, the less energy it sells.

In a filing with the PSC, the District Department of Energy & Environment lists its own interconnection issues, such as a “lack of transparency in how the cost of interconnection facilities and distribution system upgrades are calculated, [and] changes to operating requirements after Pepco approves the installation,” among others.

Schoolman says the interconnection issues extend beyond the logistics of hooking solar energy into Pepco’s grid. Under D.C.’s Solar for All program, low- and moderate-income households can apply to have their energy bills reduced with credits from solar energy generated in the District. If a solar installation goes up on top of a church, for example, residents can apply for credits to their bills from the energy the array produces. But Schoolman says Pepco has failed in some cases to apply the credits.

“The utility has had some major failures in applying credits to community solar subscribers who are part of the program,” she says.

Pepco spokesperson Jamie Caswell acknowledges the delays in connecting to the grid and in applying solar credits to customers’ bills. “We recognize that we have a critical role to play in helping the District of Columbia achieve its climate change goals and advance a clean energy future for the health and well-being of its residents in an equitable and inclusive manner,” Caswell writes in an emailed statement.

“We have an aggressive plan to address and close these customer service gaps and collaborate more closely with solar and other community partners to make affordable, reliable energy accessible for District residents and businesses,” the statement continues.

Another question facing the PSC is whether Pepco should be allowed to own “distributed energy resources,” a blanket term for any apparatus that generates power at the community or residential level. In D.C., DERs usually refer to solar energy.

The Retail Electric Competition and Consumer Protection Act of 1999 bars Pepco from owning electric generation equipment, which could include solar installations, for the purposes of selling retail electricity. But Pepco is asking the PSC to let it own solar installations.

The proposal may seem harmless enough. The more entities focused on producing solar energy in D.C., the better, right? But the solar industry believes utility ownership of solar installations will kill the competitive market place and drive up the cost of solar power in the District.

In comments made to the PSC in November, Murray’s group representing the regional solar industry explains why utility ownership is a
bad idea.

“Allowing a utility company who is able to realize a regulated rate of return to compete against entities who are unable to realize a regulated rate of return would cause immediate and irreparable harm to our members that would be fundamentally destructive to the current marketplace,” Murray writes.

The industry association estimates that the solar energy industry has invested about $500 million and created over 1,000 jobs, “which will be put at risk should the utility become eligible to encroach on marketplace fundamentals such as ownership of storage or
generation assets.”

They also point out in comments to the PSC that there is an inherent conflict of interest in a structure that allows the utility to control interconnection of renewable energy generators as well as the generators themselves.

Sunrun, a solar company based in San Francisco that operates in D.C., also submitted comments to the PSC in opposition, fearing the precedent Pepco’s ownership of solar power generators and storage could set.

“Without regulations or restrictions a regulated distribution utility could exercise preferential treatment in the pricing or the terms governing essential facilities, like the transmission and distribution of services or fairly compensate for services,” the company writes in its comments.

The company adds its support for rules and regulations that speed up interconnection of solar power to the grid.

“Chronic delays in the process of connecting [rooftop solar] systems to the grid through a utility is costing rooftop solar owners millions and potentially slowing solar adoption rates across the country,’ writes Amy Heart, Sunrun senior director of public policy.

Another issue facing the PSC is Washington Gas’ pipe replacement efforts, known as PROJECTpipes. The utility is in the second phase of its decadeslong plan, and in December 2018 asked the PSC to approve a five-year, $374 million project. The proposal would continue to recoup the gas utility’s costs through a customer surcharge mechanism the PSC previously approved.

Several entities opposed Washington Gas’ plan in full or in part, including the Office of People’s Counsel, the Apartment and Office Building Association, the Office of the Attorney General for D.C., DC Climate Action, and the Sierra Club.

OAG argues in its comments that Washington Gas’ proposal would have District ratepayers pay for a distribution system that will result in a “utility death spiral.”

“In such a scenario, it is usually those who can least afford to defect—low income customers who cannot afford to electrify their homes or do not own their own homes—that remain as gas customers to pay an ever-increasing, unaffordable share of WGL’s distribution costs,” the OAG argues. “This outcome could be dire in terms of the economic well-being of
these customers.

The OAG says Washington Gas’ PROJECTpipes, the current phase, “invites these negative economic consequences,” and is an “imprudent investment.”

The Sierra Club recommended that the PSC halt the pipe replacement plan altogether and order an assessment of the plan’s alignment with D.C.’s climate goals.

In its comments, the Sierra Club included testimony from climate scientist Ezra Hausman, who says Washington Gas’ proposal is “incompatible” with the company’s commitment to changing its business model to align with D.C.’s climate goals.

“Under [WGL’s] plan, customers who were born the year D.C. reaches carbon neutrality would continue to pay for this infrastructure until their 35th birthdays,” Hausman’s written testimony says. “They may have to break out the history books to try to understand why they are paying for it.”

Washington Gas argued the goal in its pipe replacement plan is to improve safety and reliability, and “consideration of climate issues should not override the fundamental objectives … which are the enhancement of safety and improved reliability of the natural gas system.”

The PSC ultimately approved a three-year, $150 million pipe replacement plan in December 2020.

“It’s a pretty good deal for Washington Gas,” says Mark Rodeffer, political committee chair for the Sierra Club’s DC chapter. “They get to replace it and charge somebody else for it in the rates. And we have this fossil fuel infrastructure we’re supposed to stop using in 30 years. It’s totally inconsistent with the need to address climate change. The mayor has climate plans, and [the Department of Energy and the Environment] has energy plans that are good. But she needs to appoint people who take this seriously.”

“Ratepayers will be seriously hurt by this,” he continues.

Whether Thompson will be the leader that climate activists are looking for is yet unknown. Rodeffer is choosing to remain optimistic.

In January, Bowser nominated Thompson to take Gillis’ vacant seat—another snub to the energy and climate communities.

Before the announcement, 30 solar energy advocates signed a letter asking Bowser
for a meeting and encouraging her to nominate someone with deep experience in
renewable energy.

“The ideal candidate should have expertise in the technical and legal issues involved with the clean energy transition, understand the importance of building the local clean energy economy, and share your vision for a more just and diverse sector,” the letter says.
Murray says the group never met with Bowser.

“We are optimistic that someone with the background of Mr. Thompson can educate himself on these issues and can apply some of these same principles from an agency like DC Water to an electricity space,” Murray says. “We hope she will emphasize to him the importance of familiarizing himself with D.C.’s energy market and how the PSC really has a key role in shaping the future of our energy system here.”

If confirmed, Thompson will serve out the remainder of Gillis’ term that ends in June 2022. In April, Gillis took a job as VP of system development at the Jacksonville Transportation Authority. Thompson did not respond to emails seeking comment.

Bowser highlights Thompson’s previous work in the District government as well as his work on the DC Water board of directors, which gives him “direct experience in working as a commissioner to ensure that utilities provide safe and reliable services.”

Asked whether she considered a nominee with a background in renewable energy, Bowser says she’s “considered and nominated a number of people for that board and considered all manner of experiences. And I’ve been involved in that board from my early days as a councilmember, and I haven’t experienced a nomination where I didn’t have somebody mad at me.”