Pepco and Delmarva Power announced they will file with the Maryland Public Service Commission in early February, outlining plans to provide annual tax savings to more than 770,000 electric customers in Maryland. The utilities are owned by Exelon.
There was no immediate word on the company’s plans for Delaware, New Jersey or the Philadelphia area. Exelon also owns Atlantic City Electric and PECO Energy in southeastern Pennsylvania.
Delaware’s Public Advocate is pushing for a reduction in bills, due to changes in the utility’s tax rate. The rate is believed to be calculated in the allowed rate of return on investment.
If approved, Pepco and Delmarva Power would plan to begin providing credits beginning in the first quarter of 2018.
The tax savings are the result of federal tax reductions under the new Tax Cuts and Jobs Act, which was signed into law on Dec. 22, 2017, and became effective on Jan. 1.
The decrease in the Corporate Tax Rate from 35 percent to 21 percent reduces the amount of federal income tax Pepco and Delmarva Power will have to pay.
“The tax law will result in lower bills for our customers and lower taxes for Pepco and Delmarva Power,” said Dave Velazquez, CEO, Pepco Holdings, which includes both Pepco and Delmarva Power. “We are pleased to provide these savings to our customers, while at the same time ensuring we are making prudent investments in the local power grid to maintain the safe, reliable, and affordable service our customers have come to expect.”
Any proposal in Maryland and Delaware would have to be approved by the public service commissions in both states.