Pepco

History

Pepco, an acronym of Potomac Electric Power Company, was founded in the late 19th century as a subsidiary of the Washington Traction and Electric Company, one of the private streetcar companies in Washington. Surplus power was then sold to other electric streetcar companies and to cable car companies so that they could convert to electricity. Later, the power was sold to business and residential customers.

The Public Utility Holding Company Act of 1935 forced the North American Company, the holding company, to divest itself of either their streetcar operations or their power generating utility. As power generation was far more profitable, North American choose to divest itself of the transport entity.

In 2001, the company was reorganized and became a unit of Pepco Holdings, Inc.

Transmission system

Pepco's bulk transmission system consists of transmission lines operating at 115 kV, 138kV, 230 kV and 500 kV. Pepco has interconnections with Potomac Edison (230kV, 500kV), Baltimore Gas and Electric Co. (500kV, 230kV, 115kV), and Dominion Virginia Power (500kV, 230kV).

Mergers

In April 2014 Pepco Holdings Inc. (PHI), Washington, D.C.-based parent company of Atlantic City Electric, Delmarva Power, and Pepco announced a $6.8 billion merger with Exelon, a Chicago-based utility company. A December 18, 2014 article in The Washington Post highlighted opposition by the public to the merger with Exelon, arguing that it would not be in the best interest of consumers, that it was likely to result in higher prices to District of Columbia Pepco customers and even worse reliability.

The merger was rejected by the District of Columbia Public Service Commission in August 2015, though it was approved by other federal and state regulators. On March 23, 2016, the Commission finally approved the merger. The merger with Exelon was completed on that same day.

Energy efficient rebate programs

From 2012 to 2014 Pepco offered rebate programs for residential and commercial customers looking to save energy by upgrading to energy efficient equipment and systems. Incentives helped to offset the initial capital cost of upgrading equipment.

Controversy

An investigation by The Washington Post in 2010 faulted Pepco for poor reliability. The report noted that the company's performance had slipped since 2005, comparing poorly to other major utilities in the frequency and duration of power outages. Thousands of people lost power for as many as five days after only 5-8 inches of heavy wet snow.

In 2011, Business Insider named the company first on its list of "The 19 Most Hated Companies In America" based on its American Customer Satisfaction Index rating.

During the severe June 29, 2012 derecho, more than half of the customers in Montgomery County, Maryland lost electric power. Restoration rates severely lagged behind those of neighboring power companies that were equally impacted by the storm. Pepco was unable to restore power for thousands of customers for a week. In nearby Fairfax County, Virginia, Dominion Power restored power to most customers within 36 hours. In the June 2012 derecho, over 200,000 Pepco customers lost power, and some were not restored for 8 days. Pepco charged customers a surcharge for the time they were without power and their meters were not running an administrative fee, amounting to $0.50 per customer.