Chairman Winslow and members of the Public Service Commission,
In the last few years, we have seen significant increases in residents’ energy bills. Families are
already struggling to keep pace with the rising costs of essential goods and services, and the
increased cost of gas and electricity is only adding to these families’ strained finances. That is
why last year the General Assembly passed legislation to change the standard by which rate
increases would be considered, switching from the business judgement to the prudence standard.
This legislation would allow the Commission more latitude to reject, or further modify, unfair
and unfounded rate increases and require utilities to provide greater documentation in support of
their rate proposals before being allowed to bring increased costs onto our constituents.
That is why we are disappointed to see Delmarva Power’s December 9th request for a rate
increase. The timing of this submission means it still falls under the old business judgement rule
instead of the prudence standard which went into effect at the beginning of 2026. This date was
chosen to give the Commission time to develop new regulations and processes for the new
prudence standard you would be adopting. It is our belief that the request should be resubmitted
in the new year so that it will fall under the prudence standard this body overwhelmingly
supported, sending a loud and clear message that we wanted future rate increases decided by
prudence rather than business judgement. In Governor Meyer’s state of the state address last
week, he urged the Public Service Commission to utilize every tool available to prevent more
rate increases from being passed onto our constituents. We second this request and ask the PSC
to reject this request to allow for a second more reasonable proposal to come forward under the
prudence standard.
Additionally, we hope that when the request is resubmitted that the return on equity requested by
Delmarva Power is significantly lower than its current request of 10.5%. We cannot reward
Delmarva investors with such high returns on the backs of our constituents.
As noted in the Public Advocate’s January 12th press release, Delmarva Power has sought three
electric base rate adjustments in the past five years and this most recent request would see
increases of 4.13% or $6.42 per month on the average customer’s bill. But these could be higher
for space heating customers and is higher when considering the rate increase builds in existing
DSIC rates which were not part of the last rate case. With those caveats, some customers’ base
rates could increase 23.7% or $15.63 month. These are percentage increases many working
families and fixed-income households will struggle to build into their budgets.
In our previous letter to the Public Service Commission last spring, we stated our intention to
change the state towards the prudence standard and for the Commission to utilize it to protect our
constituents from injurious rate increases. We are now asking you to do everything in your
power to enforce that legislation, including making the case that Delmarva Power should
resubmit their rate case under the new prudence standard that the General Assembly put into
place and reject the current rate case that attempts to pass on significant costs to Delawareans to
benefit out of state shareholders.
We, the members of the General Assembly, will not stand idly by while utilities create excessive
returns for their investors at the expense of our constituents. The people of Delaware are looking
to all of us to step up and provide the relief they desperately need, and they deserve our full
attention and effort at every level of government to provide that relief.
Sincerely
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