For Immediate Release
(Updated March 13, 2006 to reflect corrected monthly bill averages. The percent increase remains the same.)
Salisbury , Md. - Delmarva Power today announced the results of competitive bids to supply electricity to its Maryland Standard Offer Service (SOS) customers for one year beginning June 1, 2006 . The proposed new rates must still be approved formally by the Maryland Public Service Commission (MD PSC).
Due to significant increases in the cost of fuels used to generate electricity, the average monthly electric bill for Maryland residential customers will increase by about 35 percent, or $38.67. Residential bills will rise from an average of $109.61 today to an average of $148.28, once the June 1 price increases are fully reflected in customer bills.
For Delmarva Power's small commercial customers in Maryland , the new supply rates would increase the average bill about 40 percent. For the company's medium-sized business and industrial customers in Maryland , the new supply rates would increase about 14 percent. Individual customer impact will vary according to usage and seasonality.
The increases reflect bid prices received by Delmarva Power for wholesale power to supply retail residential and commercial SOS customers in Maryland who do not buy their electricity from an alternative supplier. The competitive bid process was conducted under rules issued by the MD PSC, which also oversaw the bidding and issued its own announcement of the proposed new rates earlier today.
The increases are substantially higher than those that went into effect last year for the June 1, 2005 to May 31, 2006 period, because the design of Maryland's Customer Choice program required a much larger amount of electricity supply be up for bid this year. In addition, current bidding and price increases are taking place in the context of an extremely volatile energy market, marked by dramatic increases in the price of fuels used to generate electricity. Between 1999 and 2005, natural gas prices rose a total of 400 percent; fuel oil prices rose 300 percent; and coal prices rose 150 percent. In just one year, 2005, the price of fuel oil rose 76 percent and of natural gas, 67 percent1.
The competitive bid process was overseen by the Maryland Public Service Commission. "We held a competitive bidding process and awarded the bids based on the lowest price for our customers," said Gary Stockbridge, Regional President for Delmarva Power. "We fully understand that these increases are substantial and that all of our Maryland customers will feel their impact."
"Although we can't do anything to change the costs of energy commodities," he continued, "what we can do is help our customers significantly reduce their consumption of electricity, thereby lessening the impact of these higher rates. We know this is easier said than done, of course. That is why we have launched "Energy Know-How," a major education and information campaign to help educate and inform our customers on how to use energy wisely."
"Helping customers manage their bills is a priority for us," said Stockbridge. "This includes encouraging customers to take advantage of 'Budget Billing,' whereby they can spread their bills evenly over the year, thus avoiding the jumps that come with higher usage in summer and winter."
Delmarva Power will also continue to actively help low-income and other eligible customers to enroll in the energy bill payment assistance programs administered and supported by the State of Maryland and Delmarva Power.
Stockbridge urged customers to visit www.delmarva.com for information on energy conservation, low-income customer assistance programs and more information on rates (click on "Your Home" or "Your Business," and then on "Choices and Rates" for either residential or commercial rate information). Customers can also call 800-375-7117 for information and assistance with registering for Budget Billing or energy assistance programs and to request any of Delmarva Power's brochures, including "85 Ways to Save Money and Energy," available in both English and Spanish.
"We also encourage community groups to contact our Speakers Bureau Program to arrange for a company representative to speak about rising energy prices and provide energy efficiency information," Stockbridge added. To schedule a speaker, customers should call 800-355-0368 or send an e-mail to: firstname.lastname@example.org.
In the coming weeks, Delmarva Power's residential and commercial customers will receive detailed individual notification of the new supply rates that are scheduled to take effect June 1, 2006 .
1 U.S. DOE/Energy Information Agency; U.S. DOL/Bureau of Labor Statistics
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