In the winter and summer months, when temperatures are at their coldest and hottest, electricity demands increase, causing hikes in utility bills. This summer, D.C. Pepco customers can expect a monthly bill increase of $20.81, or 17.7%, which became effective on June 1, as mandated by the Public Service Commission of the District of Columbia (DCPSC).
“The supply charge is a pass-through to our customers from our energy provider, which is PJM,” Lamont Atkins, Pepco director of Governmental and External Affairs, told The Informer. “For us at Pepco, we don’t have any say in what those costs or charges are, so we’re not able to affect making sure [they] stay affordable.”
PJM Interconnection is a regional transmission organization (RTO) that allocates wholesale electricity to the District and 13 surrounding states. The RTO ensures customers have enough energy available according to supply and demand by administering a capacity auction for the following year.
During these auctions, the energy provider accepts offers to distribute energy at the lowest possible costs, and accepts higher prices as the auction continues until enough capacity — or the maximum energy a generator can output — is accumulated to meet the reserved energy needed for the following year. Soon after, power providers and utility companies are given the final offer price.
At the most recent auction, which occurred in July 2024, capacity prices skyrocketed unexpectedly due to an expanding energy demand and a lack of available renewable energy, according to a press release published by the Office of the People’s Council (OPC) on May 22.
“In the next auction coming up in July, it’s anticipated, according to a report that OPC contracted, that the price will probably only go up a dollar for this next capacity auction,” OPC’s Director of Litigation Laurence Daniels told The Informer. “A number of reforms have been put in place to prevent what just happened last year.”
After taking complaints received from OPC and other consumer advocacy groups into consideration, PJM proposed changes that were approved and adopted by the Federal Energy Regulatory Commission (FERC). According to Daniels, these reforms will ensure that more supply sources are available, and PJM will improve and hopefully increase the accessibility of renewable energy sources.
To prevent even worse increases in the future, Pepco is trying to create more opportunities for generation inside D.C., as approximately 98% to 100% of the city’s energy is imported from other areas.
“I’ve only been with the company for four years, but this may be the first time we’ve seen such a large increase during the summer because of the PJM supply rate,” Atkins told The Informer. “I think going forward, we may continue to see this because of a lack of generation.”
How to Stay Cool and Cut Costs This Summer
While increased rates may be stressful to consumers, they have various options available to help mitigate the uptick in their monthly energy bills.
Pepco offers bill payment assistance, including the Low-Income Home Energy Assistance Program, the Residential Aid Discount Program and the Arrearage Management Program.
Residents can also take advantage of alternative energy options, like solar panel installations.
The Department of Energy and Environment (DOEE) offers Solar for All, which aims to help 100,000 low to moderate-income families enjoy the benefits of solar-powered energy. According to DOEE, “all Solar for All participants should expect to see a 50% savings on their electricity bill over 15 years.”
Other solar energy programs are available.
For long-term Washingtonian Barbara Allen, utilizing Sunrise Solar two years ago was a complete game-changer.
“My Pepco bill would run during the summer between $500 and $600 a month, but my daughter got her solar panels… and she gave me the gentleman’s name,” Allen told The Informer. “He came, he put the solar panels on my house, and my Pepco bill has not been over $90 since.”
Even though solar panels have proven to save ratepayers money, there is still reluctance to trust the alternative energy source, especially among the city’s senior citizen population.
On June 5, at the Hattie Holmes Wellness Center, DCPSC hosted an educational outreach event for seniors called “Flip the Switch.” Ward 3 and 4 residents learned about different options available to them to conserve energy and save money during the summer.
Even though she was an attendee, Allen spent the majority of her time at the event trying to persuade community members to convert to solar energy, telling her story in hopes that she would open others’ eyes to this method of sustainably decreasing energy bill costs.
“Some of the programs D.C. has are income-driven, and they are afraid they may not qualify,” Allen told The Informer. “There are people here I’ve been talking to about the solar panels who are not quite ready because, for them, they feel like there’s some hidden catch that’s going to jump out at them.”
The District’s senior population has a median household income of $65,855 annually, which is significantly less than their counterparts in the city who earn approximately $87,800 per year.
Many who have retired usually rely on three primary sources for income– Social Security, pension plans and savings.
Long-term resident and senior citizen Audrey Baker is skeptical of investing her money into alternative energy sources due to her dependence on fixed income sources and the trouble she’s had with energy assistance programs.
“If I can’t pay for my electricity now, what happens when that solar bill comes in?” she said. “I don’t want to get involved in that. None of that.”
‘Energy Is Something We Cannot Live Without‘
Although providers don’t control energy costs, Baker condemns Pepco and other utility companies for not being prepared to handle the surge in demand they witnessed at last year’s PJM auction.
“They knew they would have that demand,” she told The Informer. “It’s like if you have a business, you know that you have to pay taxes on the business.”
Pepco customers can call the utility company’s customer service center if they know they’ll have trouble paying their bill. By doing so in advance, they can prevent their services from being shut off and possibly set up a more manageable payment plan.
According to Atkins, the company is “always happy to help.”
Customers can also easily remain proactive in reducing their costs by following basic energy tips, like unplugging any unused devices and appliances, turning off unnecessary lights and even closing their curtains during the summer to prevent the sun’s heat from warming up their houses.
Even still, OPC and other advocacy groups are adamant about ensuring customers have access to affordable energy.
“Energy is something we cannot live without,” he told The Informer. “People need the ability to have energy that is fairly priced because it runs so many aspects of our lives. It’s the way we heat and cool our homes, it’s the way we provide light and energy to our appliances,… so we have to make sure the rates are fair.”