Delmarva Power will implement a 3.3 percent rate increase request for customers' electric and gas bills effective April 19, ahead of the Delaware Public Service Commission’s review.

Delmarva Power will implement a 3.3 percent rate increase request for customers' electric and gas bills effective April 19, ahead of the Delaware Public Service Commission’s review.

Delmarva is allowed to implement an increase seven months after it files for a request, by state law. But, if its request is denied, it will provide refunds, with interest, to its customers, Delmarva Power spokeswoman Bridget Shelton said Monday, March 22.

The utility filed for a delivery rate increase with the Public Service Commission in September, Shelton said. Delmarva Power’s last electric delivery rate increase occurred in 1995.

However, this increase on the delivery side of customers’ utility bills comes one year after the three-year phase in of a 58-percent increase on the supply side of people’s bills. Residential bills come in two parts: 75 percent for the amount of power they use and 25 percent for delivery of that power.

Delivery rates reflect the costs of providing the infrastructure (such as poles, wires and equipment), system, employees and services necessary to move electricity through the wires to customers, Shelton said.

The Delaware Public Service Commission, which regulates privately owned utilities, anticipates making a ruling between July and September because of the complexity of the case, commission spokesman David Bonar said.

What's Next

The Delaware Public Service Commission anticipates making a ruling on Delmarva's rate increase between July and September. If the commission reduces the hike, the utility will provide refunds, with interest, to customers.
- Commission spokesman David Bonar.

“Their cost of doing business has gone up just like anybody else’s,” he said.

The average, monthly bill for residential customers will increase $4.96 (3.3 percent), Shelton said. The impact on larger commercial and industrial customers will be less because only 15 percent of their bill is for delivery.

But they’ll see a 1 percent to 10 percent increase in their bills, Shelton said. She did not have dollar amounts for that range.

Delmarva Power delivers electricity to about 300,000 homes and businesses and natural gas to 121,000 customers in the Diamond State. The utility, owned by Pepco Holdings, Inc., provides energy to more than 500,000 electric delivery customers in Delaware and Maryland.

The rate increase is something Brandywine Hundred resident James D. Metzger saw coming when Delmarva began to replace Westinghouse meters in people’s homes with digital meters. In November, Delmarva Power announced its plan to upgrade to “smart” electric meters and gas modules that will allow the company to read meters from headquarters.

“I think Delmarva comes out of it in much better shape than its customers,” he said. “I liken this to going to a gas station, putting money in to start the pump, then paying for the gas as well as a delivery charge just to put it into your car.”

Shelton said this is the cost of doing business. The company’s poles, wires and equipment must be maintained.

As for the new meters that are replacing 19th century, analog Westinghouse meters, there is another cost, Metzger said. Namely, they will give the utility more control over people’s use of power.

“If their system starts to be overloaded, they can shut down the electricity coming to your home for as long as necessary,” he said. “I know that they can do a similar thing now by shutting down sub-stations to whole areas, but this allows them to do it on an individual basis.”

Hypothetically, Delmarva could use the smart meters to turn off power in individual homes, Bonar said. But they would not be allowed to do that.

“The commission would not look kindly on a select cutoff,” he said.  “They would be subjected to some significant review should that happen.”

Shelton does not see that happening.

“I don’t see that day coming because there is enough power to serve all customers, even during peak usage periods.”