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Pepco-Exelon: the Zombie That Will Eat Us Ratepayers

Just when we thought the thing had finally died, like a zombie — it came back! This time in a revised DC Public Service Commission (PSC) ruling announced on March 23, 2016.

Hailing the ruling, Exelon’s press release trumpeted that “the merger provides benefits to our customers and continues and expands our role as a partner in the communities we serve. This new era will bring a new level of service excellence and economic and environmental benefits to our customers, while maintaining our leadership and partnerships in our local communities.”

(Note that this was not from Pepco, further confirming our dismay that any semblance of local control will be a thing of the past.)

But what are these alleged “economic benefits” to us already beleaguered ratepayers? Well, one is the one-time credit of $50, previously hailed by the Chicago-based Exelon as a fine thing — but now it seems that it will be more like $47 — they clearly think all of us have just rolled off the turnip truck!

Another sop they have tossed out is that residential customers who haven’t paid their bills for the past two years will have those accumulated charges forgiven. Why in the world should the PSC go along with that? Did the Commission ever think about all the customers who struggled to dutifully pay their bills and not question why they should end up subsidizing the ones who didn’t.

As for those who genuinely had real problems due to no fault of their own, assistance should be provided directly through a city-funded program in the same way that other programs for deserving, down-on-their-luck residents are funded — through the regular City Council appropriations process.

This brings us to one of our major objections — one that we have  not previously commented on in four earlier editorials — tapping electric customers to pay for city programs that should be included in the regular city budget and not through a kind of “off the books” scheme separate from the normal way the government raises its revenue.

In an extensive, well-researched and thoroughly analyzed commentary about the then still pending proposed acquisition by Exelon (written much like a legal brief), dated December 7, 2015, Councilmembers Mary M. Cheh (Ward 3), Charles Allen (Ward 6), Elissa Silverman (At-Large), and David Grosso (At-Large) cogently addressed this issue as follows:

“[T]he Mayor touts an additional $39 million in payments to the District government as a public benefit. These payments ostensibly go to various funds intended for energy, environmental, or workforce development programs; but, increased amounts in those funds mean only that the Mayor can offset the funds she would have allocated [through the regular budget process] . . . freeing up money to pursue other priorities. . . . There is nothing . . . that requires [these] funds to supplement rather than supplant the . . . funds’ regularly allocated annual budgets”

So, as we contend, we ratepayers will effectively be hit with nothing other than a tax increase disguised as a benefit from the electric company; a total scam if we ever saw one. Or, as Councilmember Cheh stated in an April 7th press release about the entire Pepco-Exelon deal, “. . . from my analysis it doesn’t appear to satisfy requirements set forth by the Office of the People’s Counsel in terms of protections for rate payers. In any event, this deal is rotten at its core.” (Italics ours.)

There is so much more that these Council members discussed in detail and about which we concur that we do not have space to address here; their 11-page statement is posted on our website.

On April 4th, the Office of the People’s Counsel (OPC) announced that it “is carefully reviewing the Commission’s order that approved the merger to determine next steps and whether it will request the Commission reconsider its decision.” We strongly urge that the OPC do so vigorously. And, in so doing, make the pitch that if the PSC insists on upholding its ruling that it at least scrap the phony “benefits” of forgiving all those delinquent customer bills and the $39 million for the mayor to use as she wishes and instead require that the utility provide for low-income senior citizen discounts on their electric bills — much in the same way the City Council long ago provided meaningful discounts on real property taxes as a way to help seniors afford to stay in their longtime homes.