Public Advocate says Delmarva’s proposed 8.35% rate hike excessive

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Delmarva Power’s proposed rate increase will not sail through Public Service Commission proceedings if the Office of Public Advocate has its say.

The office represents customers in Public Service Commission rate cases.

“As customers are struggling to pay bills, Delmarva Power is seeking one of the largest electric distribution rate increases we have ever seen,” said Delaware Public Advocate Andrew Slater. “Simply put, reliability is extremely important but so, too, is affordability. No customer should have to choose between paying for their utility service or paying for other essential needs. It’s long past time costs are reined in just as many of their customers are trying to do.”

In past rate cases, regulators have been skeptical about further upgrades, citing costs that lead to only a minimal increase in reliability. A less favorable regulatory environment was a factor in Delmarva’s parent company PEPCO merging with the nation’s largest utility Exelon.

Delmarva has argued that upgrades are necessary since the need for more reliable service has grown for businesses and residential customers. Also, underground and above-ground utilities that were installed decades ago during previous building booms in the state are beginning to need more maintenance and upgrades. Also a factor is the growth of solar power, which is fed into the grid when customer use declines.

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Under state law, the increase will become effective on a temporary basis on July 15, 2023, subject to refund, pending a final decision by the Delaware Public Service Commission.

Delmarva Power’s request for an increase in electric distribution rates comes after a $16.7 million increase approved by the Public Service Commission on August 5, 2021.

If approved as requested, Delmarva Power residential and residential electric space heating customers will experience an additional increase of 8.35 percent and 13.2 percent, respectively, in their electric distribution charges. A typical residential non-space heating customer using 844 kWh per month would see an additional increase of $10.41 per month to their total bill, and a residential space heating customer would see an additional increase of more than $11 per month to their total bill.

“As customers are struggling to pay bills, Delmarva Power is seeking one of the largest electric distribution rate increases we have ever seen,” said Delaware Public Advocate Andrew Slater. “Simply put, reliability is extremely important but so, too, is affordability. No customer should have to choose between paying for their utility service or paying for other essential needs. It’s long past time costs are reined in just as many of their customers are trying to do.”

This requested distribution rate increase of roughly 25 percent follows a nearly 60 percent increase in natural gas supply rates over the past two years.

Delmarva Power’s reliability is in the top tier among utilities. Even so, Delmarva Power intends to spend $430 million on plant over the next three years. This represents an increase of 155% over Delmarva’s 2019 plant spending.

The Public Service Commission will hold a public comment session once a procedural schedule is established. Written comments may be sent by mail to Delaware Public Service Commission, Docket No. 22-0897, 861 Silver Lake Boulevard, Suite 100, Dover, DE 19904, or by e-mail to psc@delaware.gov, Attn: Docket No. 22-0897.

Delawareans can contact Energize Delaware about its Home Performance with Energy Star, and Home Energy Counseling and Check-Up programs. These programs could potentially produce energy savings. Consumers may learn more at: https://www.energizedelaware.org/.

Additional programs, such as weatherization and the Low-Income Home Energy Assistance Program (LIHEAP) may be able to help customers save on energy costs. Customers can review eligibility requirements for both programs by calling 302-504-6111 for the Weatherization Assistance Program and by calling Catholic Charities for LIHEAP assistance at 302-654-9295 (New Castle County), 302-674-1782 (Kent County), or 302-856-6310 (Sussex County).

To learn more about the Division of the Public Advocate, click here.

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