Proposed Order Would Decrease Bypassable Default Service Administrative Charges

A proposed order from a Maryland Public Utility Law Judge would determine the components for the bypassable SOS admin. charge at Pepco and Delmarva, and would result in a reduction in the charge versus the current charge.

The current SOS admin. charge, for residential customers in Maryland, at Pepco and Delmarva is 4 mills per kWh.

The proposed order would set the SOS admin. charge as stated in the tables below. Note that cash working capital (CWC) would now be a separate bypassable component. Also note that while the PULJ would order a cost of service study for unbundling to determine the administrative adjustment (overhead costs related to SOS, etc.), the PULJ would find that there is currently no basis upon which to set the administrative adjustment and would set the charge as zero pending development of actual costs.

Pepco PULJ Proposed Admin. Charge:

Delmarva PULJ Proposed Admin. Charge

As noted above, the PULJ concludes that a cost causation study is required to allocate the customer-related administrative costs that may be embedded in distribution rates and may be attributed to customer services used by the SOS customers

While the PULJ finds that the Administrative Adjustment (SOS overhead) should be maintained as part of the bypassable SOS admin. charge, "there is not sufficient evidence in the record to permit me to set an Administrative Adjustment component rate in this proceeding

The PULJ would thus set the Administrative Adjustment at 0 mills/kWh for all rate classes. The PULJ would direct the EDCs to file in their next base rate case a cost of service study to allocate the customer-related administrative costs between SOS and distribution service.

For the uncollectibles component, the PULJ would direct the EDCs to use actual SOS uncollectible costs for all rate classes. "Because the component will be trued up with actual costs, I initially set the residential Uncollectible Cost component as recommended by Staff, which I understand is the rate established in each Company's last base rate case," the PULJ said

The proposed order also discussed how the PULJ arrived at the values for the SOS admin. charge components above, and policies regarding setting the return and other components

Additionally, the proposed order addresses how often the admin. charge should be true-ed up. See the proposed order here for more details

Case 9226, 9232