A PHI Company

We're connected to you by more than power lines.

Delmarva Power Unveils Proposals to Lower Costs, Improve Reliability, and Enhance Energy Independence

Tuesday, February 06, 2007

Newark, DE – Delmarva Power today proposed an ambitious program that combines traditional energy efficiency programs with innovative technologies to help customers manage their energy use and reduce the total cost of energy.

“Energy efficiency is the lowest cost and the cleanest way to address future energy needs,” said Dennis Wraase, Chairman of the Board, President and Chief Executive Officer, Pepco Holdings, Inc., the parent company of Delmarva Power.

“If we can provide tools for PHI’s nearly two million customers to reduce their electricity usage, we can make a measurable contribution to meeting the nation’s environmental challenges and at the same time help customers keep their electric bills affordable,” Wraase added.

New technology will lead the way toward energy independence in the comprehensive plan filed by Delmarva Power. The proposals include Demand Side Management efforts, such as rebates or other incentives for residential customers to update inefficient appliances with Energy Star replacements. Customers could also receive credits on their bills for allowing Delmarva Power to “cycle,” or intermittently turn off, their central air conditioning or heat pumps when wholesale electricity prices are high.

Business customers would receive financial incentives for using energy efficient equipment such as peak performing lighting and HVAC systems, and would be rewarded for reducing use during periods of peak demand.

Last year Delmarva Power invested in web based, energy auditing software. That investment is already paying off for Delmarva customers who may monitor their own energy use and learn what changes might lower their costs. Today’s filing with the Delaware Public Service Commission outlining Delmarva Power’s comprehensive complement of energy efficiency and demand side management programs is the next step and represents the future in energy efficiency.

Delmarva Power also proposed to install “smart meters” in the first phase of an effort designed to improve reliability and, ultimately, give customers options for lowering usage and cost. The smart meters, which the company proposes to install in the homes of all Delaware customers over the next three to four years, would give Delmarva Power the ability to remotely identify the location of outages without customers calling in. When combined with additional investments in technologies planned by the company, smart meters can give customers the information and options they need to manage their demand when electricity prices are high.

Delmarva Power’s plan enables customers who generate their own electricity through renewable sources, such as solar or wind, to sell back more of the electricity they generate but don’t use. The company is also considering a plan to provide a separate meter to allow electric vehicle users to recharge their vehicles at home.

These environmental initiatives build on actions the company is taking at the corporate-wide level. PHI, Delmarva Power’s parent company, currently is using biodiesel and ethanol blends to fuel a portion of its 2,000 vehicle fleet and is testing electric hybrid technology in the District of Columbia, New Jersey and Maryland. PHI plans to continue to evaluate these and other technologies to increase the number of alternative fueled vehicles in its fleet. PHI also is joining the National Action Plan on Energy Efficiency Coalition, a broad based group of utilities, environmental advocacy groups, State Utility Commissions and others working together on environmental issues.

A recent study sponsored by PJM and mid-Atlantic public utility commissions--including the Delaware Public Service Commission--estimates that programs such as those advanced in Delmarva Power's blueprint for the future could save Delaware customers $10.6 million per year, depending on how the programs are structured and how many customers participate.

As part of the filing, Delmarva Power proposed ways to fund the programs outlined and offered to work with the Delaware Public Service Commission to determine the most appropriate mechanisms to permit full and timely recovery of the company’s investments.

Delmarva Power Regional President Gary Stockbridge said, “While we are aware that Delaware’s energy issues cannot be solved by any one group, our customers want to know that we are doing everything we can to provide reliable service and help them deal with higher energy prices. Through this plan, Delmarva Power is offering to help customers save money, clean the environment, and make us more energy independent.”

The Delaware Public Service Commission will review Delmarva Power’s proposals and will decide whether these plans will be implemented. PHI plans to make similar proposals in other jurisdictions it serves.

###

Editors Note: refer to Delmarva Power's website (www.delmarva.com) for information on electrical safety, energy saving tips, bill payment options and power outage updates.

Delmarva Power, a public utility owned by Pepco Holdings, Inc. (NYSE: POM), provides safe and reliable energy to more than 500,000 electric delivery customers in Delaware, Maryland and Virginia and over 118,000 natural gas delivery customers in northern Delaware .