Many state residents could see their monthly electric costs increase after Pepco proposed raising its prices, to the concern and dismay of many university officials and off-campus students.
The company, which services customers in the state and Washington, hopes to raise its electricity prices for state customers by $7.13 a month, along with a supplementary charge of 96 cents to advance its power grids’ reliability. But the additional expenses could negatively impact the university’s already limited budget, said Jack Baker, operations and maintenance director.
During the summer, Pepco produces at least half of the power used on the campus, while the other half is created in the university’s central plant, Baker said.
“The university is a big Pepco customer,” he added. “If the cost were to increase, it would certainly have an impact. We would have to increase our fuel utility budget, which supports gas, electricity and fuel across campus.”
The company has committed more than $1 billion for infrastructure enhancements for the state over the next five years in the hopes of decreasing widespread outages and delivering better and safer service. Pepco has worked for two years to make its electrical system more reliable by trimming trees that hang over power lines, updating grids and adding electrical feeders throughout the area, said Thomas Graham, Pepco region president, in a news release.
“Customers are experiencing fewer outages, and the outages that do occur have shorter durations,” Graham said.
If the Maryland Public Service Commission approves the company’s plan in July 2013, customers will begin paying the $7.13 rate and the 96-cent surcharge will go into effect January 2014.
The cost is a strain on students’ budgets, especially those living in off-campus houses, said senior English major Erin Emelio.
“I think that as an unemployed college student, any price increase bothers you,” she said. “$7 a month isn’t a huge increase, but combined with all of the other house bills we have to pay, it adds up.”
While numerous customers have criticized Pepco’s reliability — especially following June’s derecho, which left millions of customers without power for more than a week in the midst of sweltering heat — Baker said the university and surrounding area businesses have experienced few power outages over the last few years. Most outages were caused by car accidents or trees knocking down powerlines, neither of which are the electric company’s fault, Baker said.
“We have been very successful in recent storms,” Baker said. “We may have seen small blips in the power, but we have not lost power for a long extent of time.”
Because of Pepco’s initiatives, the company reported state customers so far experienced 38 percent fewer outages and a 36 percent decrease in outages’ duration from 2010 to 2012. And the company expects improved service in 2012 and 2013, it said.
Emelio said her house has had few power outages, and those that do occur have not persisted for very long.
“We’ve had good experiences with Pepco,” she said. “Our one power outage happened during Sandy, and it only lasted for two hours.”
Pepco is also proposing stricter reliability standards to meet in 2015, with an incentive that will necessitate the company to pay back customers up to $1 million if it does not meet the minimum reliability standards, and the company would charge clients an overall additional $1 million if it achieves the higher standards.
Though the university may struggle to pay these higher costs, Baker said it does not have many other options for electrical services.
“We don’t really have a choice but to pay for it,” he said. “Pepco has been working to improve their reliability, and that’s always going to bring an added cost.”
