When I was mayor of the District, the financial strength of the city was restored. I know what it takes to drive investment and bring vibrancy to our neighborhoods, especially underprivileged ones.
Pepco and Exelon have declared how they would deliver rate relief, better service and more clean energy if the deal is approved. Both companies have shown clearly that there are tremendous economic opportunities and benefits for D.C. residents included in the agreement. That's not just my opinion; the mayor and other D.C. agencies have looked over the agreement with a fine-toothed comb, and the package of benefits is extensive.
Arguments that the deal would cause rates to go up are wrong. This deal comes with commitments that make electricity more affordable, including a $50 rate credit for each D.C. household, $25.6 million in funds to erase any distribution rate increases through March 2019, about $16 million to help low-income customers with bill assistance and weatherizing homes and millions of dollars in savings that would be used to keep rates lower than they would be.
Some critics have said the deal threatens clean, renewable energy in the District. Exelon is one of the leading U.S. providers of clean, zero-emission energy, including wind and solar. The deal includes commitments to accelerate the District’s progress in making energy more sustainable and has gained support from the District’s Department of Energy and Environment and the Alliance for Solar Choice, among others.
These commitments include developing up to 10 megawatts of new solar power on top of the District's current 15 megawatts, $7 million for renewables and energy efficiency programs, easing the process for installing solar panels on our homes and buildings, growing the District's Green Building Fund with a $10 million contribution, creating four new microgrids in the District and purchasing 100 megawatts of wind energy.
The District's Public Service Commission sets rates for Pepco customers, and it would continue to do so after the acquisition. Pepco would continue to buy electricity for its customers on an open market from the lowest-cost supplier, showing no preference for Exelon or any other power generator. That would not change.
Pepco customers are responsible only for Pepco's costs, and that would remain so. The settlement stipulates Pepco's business would be separate from Exelon's, with separate financial resources. Pepco customers cannot be held responsible for the debts of Exelon or any of its other businesses. In the event of serious financial threat or bankruptcy, the settlement grants additional authority to the commission to make Exelon divest Pepco.
The settlement raises the bar for Pepco's performance, ensuring improved service reliability, meaning the lights would stay on more and come back on faster. Also, service must exceed the PSC's standards for the frequency and duration of power outages or else both companies would face significant penalties. The companies must meet those standards within existing budgets, protecting customers from new costs. The deal would give Pepco access to more field crews and resources, allowing faster restoration after major storms.
This deal would be good for employment in the District. The companies committed to providing $5.2 million for workforce development, hiring more than 100 union workers in the District, adding another 100 positions in the District by 2018 and moving Exelon Utilities, which oversees the company's electric and gas utilities, and the primary offices of Exelon's chief financial and chief strategy officers to the District. How often does a Fortune 150 company with the economic strength of Exelon announce that it wants to make an investment in the District? Not often enough.
Energy fuels our economy. Fortunately, this deal would make Pepco stronger and greatly benefit its customers. The alternative would forfeit all these benefits. I commend Mayor Muriel E. Bowser (D), the attorney general, the people’s counsel and others who negotiated a settlement that secures enormous benefits for D.C. residents. The result helps put the District on the path to an affordable, reliable and sustainable energy system.
We lose too much if we don’t pursue this opportunity for the city. There’s too much at stake. This unique agreement should soon win approval for the gain of everyone in the city.
The writer, a Democrat, was mayor of the District from 1999 to 2007 and is chief executive of the Federal City Council.
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