Exelon’s Pepco on Oct. 26 said that it has filed a multi-year plan (MYP) with the Maryland Public Service Commission, requesting a 4.4% ($5.50) upward adjustment of typical monthly residential bills effective April 1, 2023, and a 4.2% ($5.50) upward adjustment of typical monthly residential bills effective April 1, 2024, to reflect the investments being made over the period of the plan.
In total, over the period covered by the plan, customers would experience an $11 monthly increase in the typical residential bill, or 1.29% annual average per year over the period of the plan since the last rate increase, the company said.
As noted in the application, the company is proposing a three-year MYP covering the three-year period April 1, 2021 through March 31, 2024. The company added that in order to continue to meet its obligation to provide safe and adequate service, Pepco must continuously replace and enhance the distribution system infrastructure. Pepco also said that new technology has been installed, enabling it to provide more reliable service in a cost-effective manner. In order to maintain and enhance its infrastructure and implement those distribution technologies, Pepco said that it must continue to make substantial investments in infrastructure and have a reasonable opportunity to recover its costs.
The company noted that since 2012, customer outages have been reduced by 48% and when an outage occurs, customers are restored 64% faster.
Pepco said that it is projected to spend about $259m in 2020, and $1.09bn over the four-year calendar period 2021-2024 on upgrades and improvements to its Maryland distribution system.
Pepco also said that it is presenting a plan to convert company owned streetlights throughout its service territory to light-emitting diode (LED) streetlights with smart nodes, and is requesting that the commission allow Pepco to record the operations and maintenance costs associated with deployment of the Smart Streetlight Initiative as a regulatory asset, to be amortized over five years. Pepco said that it is also proposing to deploy a Smart Sensor Pilot to demonstrate the benefits and functionality of smart sensors, and is requesting that the commission allow the company to record the costs of that pilot as a regulatory asset, to be considered in a future base rate case proceeding.
Pepco noted that it provides evidentiary support in its application for electric revenue deficiencies of $44m for the 12 months ended March 31, 2022; $78m for the 12 months ended March 31, 2023; and $110m for the 12 months ended March 31, 2024.
The company said that in light of the impacts of the COVID-19 pandemic, its proposal includes the acceleration of certain tax benefits and pause in amortization expense that results in no overall distribution rate increase for customers during the first two years of the MYP, and a partial offset to overall distribution rates in the third year of the MYP. Pepco said that under its proposal, customers would see no overall distribution rate increase until April 2023, adding that the proposed rate increase in April 2023 after offsets is $56m. The impact of the requested rate increase on the typical residential Standard Offer Service customer using 811 kWh per month is $0 per month for rate years one and two, the company said, adding that for rate year three, the per month increase is $5.50, representing a 4.4%.
The company noted that it has established a regulatory asset to record any incremental impacts related to COVID-19, and that it is seeking recovery of that asset over the term of the MYP. In addition, Pepco said that in a separate case (Case No. 9478), the commission directed the company to submit an electric vehicle (EV) pilot project and authorized it to defer all pilot-related incremental costs into a regulatory asset for recovery in a base rate case. Pepco said that it is seeking recovery of those costs in the MYP.
Discussing the current status of Pepco’s Maryland EV program, the filing noted that as of the end of September, Pepco has provided 114 residential rebates and fulfilled a charging station installation at one multifamily property. Pepco said that its public charging program has completed construction of 13 public charging stations, with four under construction and 38 in engineering/design or awaiting approvals.
The company further noted that it is proposing “tracking only” performance incentive mechanisms (PIMs) be included as part of its proposed MYP, adding that it has proposed five tracking PIMs covering reliability measures, customer service measures, and environmental related measures. Pepco said that the proposed tracking only PIMs do not include any penalty or reward and do not impact the revenue requirement over the MYP periods.
As noted in the filing, Pepco’s proposed EV Chargers Installation PIM, for instance, is based on the number and pace of public EV charging station (EVCS) Pepco will install in its Maryland service territory. The filing noted that installation of EVCS in Maryland is necessary to support the adoption and growth of plug-in EVs (PEVs) in the state, which has a goal of supporting 300,000 PEVs within the state by 2025.
As noted in the company’s statement, a decision on the current proposed plan is expected from the commission in May 2021.