Delmarva Power implemented a gas rate increase for its ratepayers on Sunday, April 20 and electricity customers can expect a similar increase starting June 1.
The summer rate hike announcements follow public outcry over noticeably high energy bills from customers during the winter months.
These skyrocketing energy bills prompted various public hearings in February and March between Delaware lawmakers, Delmarva Power, the PJM Interconnection — the the regional electric grid operator for the Mid-Atlantic region — and various other stakeholders.
Delmarva Power attests the bill spikes were due to unseasonably cold temperatures and record-high energy utilization by customers, but the utility company has also seen various rate increases in recent years.
In February 2021, the Public Service Commission (PSC) awarded Delmarva Power a $6.7 million natural gas rate increase and an additional increase of $13.4 million in November 2022.
During that same time period, Delmarva Power’s electric rates also increased by $17.7 million in 2021 and $42.25 million in 2024, totaling $125M in PSC approved rate increases.
The April 2024 settlement agreement for Delmarva Power's electric rate filing resulted in a $4 increase, or 3.47%, on the total bill and a profit margin of up to 9.6%.
Delmarva Power also implemented its winter rate structure in October 2024, which generally increases customers' rates by around 3%.
Now, the utility company is announcing additional rate increases for its customers on the gas and electricity side.
At a State Senate Environment, Energy and Transportation Committee meeting held in March, Chair and State Sen. Stephanie Hansen (D-Middletown) noted Delmarva's gas rate increase request of $44.9 million — the largest rate increase Delmarva Power has ever requested.
She said this request would increase money going to Delmarva's shareholders by 10% and noted in Delmarva's own filings, the utility company stated the change would lead lead to a 23% increase in ratepayers' bills.
The PSC has since approved an interim gas rate increase of around $17 million that will average around $8 more per customer depending on usage.
“That fee was implemented on April 20 and reflects the necessary investments we make to upgrade and maintain the natural gas delivery system to help ensure safe and reliable service for our customers," said Delmarva Power spokesperson Frank Tedesco.
While the PSC continues to review the rate increase, Tedesco says refunds could be issued if the commission ultimately approves lower rates.
Additionally, Delmarva Power electricity customers can expect an average supply cost increase of $10 starting June 1 if their household uses around 811 kilowatt-hours.
Tedesco explains this is a pass-through cost for electricity purchased by Delmarva Power on behalf of customers, assuming they do not have a third-party electric supplier.
The increase is due to the region having an imbalance between available energy and increased demand, which is ultimately driving up the supply cost.
This was made evident in a July 2024 energy capacity auction that saw a price increase of 568% — from $2.2 billion to $14.7 billion — compared to the price of the year prior.
"That is something that our company does not control. We're not involved in generation, so we procure energy from those markets. And yes, there is volatility in those marketplaces. And again, you've seen the national conversation on the need for additional generation that can help really keep those prices stable,"Director of External Affairs and Regional Vice President for Delmarva Power Marcus Beal said at one of the hearings.
He explained customers can expect to feel the impacts of that energy capacity auction from June 1, 2025, to May 31, 2026.
PJM has raised concerns over states pushing existing generation resources off the system — generally coal plants — before an adequate quantity of replacement generation is online.
Delaware lawmakers have been advancing a slate of energy bills through the General Assembly to try and address underlying and immediate energy issues on the cost relief side, as well as the generation side.
Delmarva Power reports the average gas and electric customer bill may increase from $224 to $243 per month.
Delmarva Power stopped late payments fees for January through March, extended its repayment period for up to 24 months for bills that were overdue and suspended disconnections for non-payment.
Although those unique relief efforts have ended, Tedesco says their is still support for customers who need assistance.
"Customers are strongly encouraged, to visit, Delmarva.com/billsupport for information to help our customers better understand their energy bill, rates, resources that can help lower their monthly bills, including energy assistance options, energy efficiency programs and tips to make their homes or businesses more energy efficient leading up to summer."
Tedesco explains there is further information about payment plans and assistance programs, as well as tools to monitor and reduce usage.
