DELMARVA POWER SAYS IT IS WILLING TO OFFSET INTEREST FOR DELAWARE CUSTOMERS WHO PHASE IN HIGHER ELECTRICITY RATES
Thursday, April 20, 2006
Newark, DE--Delmarva Power officials said today that they are willing to offset interest for Delaware customers who choose to phase-in higher electricity rates driven by increases in the costs of fuels used to generate electricity.
Differences in timing led to differences between plans in Delaware and Maryland to allow Delmarva Power’s customers to phase-in the higher rates. The company supported House Bill 6, Delaware legislation that was passed on April 6th to give customers the option of phasing in the higher electricity rates at an interest rate equal to the company’s actual borrowing costs. In the past week, the company has been part of a broader group that negotiated an agreement to define the phase-in program for Delmarva Power customers in Maryland. As a result of that agreement, which is now being considered by the Maryland Public Service Commission and was negotiated weeks after the Delaware legislature acted, Delmarva Power’s Maryland customers do not have to pay interest to phase in the new rates.
Delmarva Power Regional President Gary Stockbridge said, "Given what we knew in Delaware at the time, we negotiated in good faith. In fact, at the time the legislation was passed, we had on file with the Maryland Public Service Commission a settlement agreement that would have enabled us to recover interest charges from Maryland customers. Given what has happened since, we will work with the appropriate Delaware state officials to ensure that customers in Delaware are treated in a fashion that is consistent with the way customers in Maryland are being treated. While there are significant differences between the situations in the two states, we want customers to have confidence that we are taking appropriate steps to help customers in both states deal with higher rates driven by increases in the costs of fuels used to generate electricity."
Stockbridge said customers should not overestimate the value of not having to pay interest on the option of phasing in the rates set to take effect May 1st. "No interest does not equate to no consequences. With or without interest, customers who put off paying the higher rates now will have to pay significantly more than they otherwise would later."
Stockbridge said the basic details of the phase in option that have been communicated to customers will remain the same. Residential and small commercial customers in Delaware who do nothing will have the rates phased in over three steps—May 1, 2006, January 1, 2007, and June 1, 2007. Customers in those categories who do not want the rates phased in must either call the company at 877-285-9316 or visit the company’s website, www.delmarva.com.
Stockbridge said approximately 71,000 customers have already elected to opt-out of the phase-in plan. He said the company will communicate with customers who have opted out once all the details of the revised phase-in plan have been finalized with Delaware state officials.
Delmarva Power, a public utility owned by Pepco Holdings, Inc. (NYSE: POM), provides safe, reliable and affordable regulated electric and natural gas delivery services to more than 500,000 customers in Delaware, Maryland , and Virginia .