Utility Rates and Ratemaking Amendment Act of 2026

COMMITTEE ON HOUSING
ROBERT C. WHITE, JR., CHAIR
COUNCIL OF THE DISTRICT OF COLUMBIA

Statement of Introduction
Utility Rates and Ratemaking Amendment Act of 2026
February 13, 2026

Today, alongside Councilmembers Pinto, Nadeau, and Parker, I am introducing the Utility Rates
and Ratemaking Amendment Act of 2026. District residents and businesses have experienced
sharp and sustained increases in utility bills in recent years. The issue is not unique to D.C. –
external pressures including rapid data center development, volatile tariffs, and global conflict all
play a role – but the District is especially vulnerable to market swings, in part because we have
limited ability to generate electricity locally. Many of these factors fall outside local control, but
they are not the whole story. Pepco’s shift to multiyear rate plans and Washington Gas’s
surcharges tied to the District SAFE pipe replacement project have contributed to steadily rising
electric and gas bills.1,2 These increases persist despite existing consumer protections and despite
the utilities' commitments to reduce costs.

Utility companies are in a difficult position. Wholesale costs are rising due to factors beyond
their control, and they are responsible for safe and reliable delivery in a volatile market.
However, the tools Pepco and Washington Gas rely on lack the appropriate cost-saving
incentives and residents are paying the price. The District’s Public Service Commission (PSC)
has regulatory authority over utility rate cases – this legislation preserves that authority but adds
necessary guardrails for multiyear rate plans and infrastructure projects in order to shift the
financial burden off of customers. Multiyear rate plans will still be eligible for approval, but only
if they are based on historic costs, exclude reconciliation mechanisms, and clearly demonstrate
customer benefit. Similarly, large gas infrastructure projects may still be approved but must
prove that alternatives were seriously considered and ensure surcharges are considered in future
rate cases.

District residents cannot afford inaction. Typical households are paying nearly $600 more per
year with no change in usage. 80,000+ Pepco customers are in arrears, owing more than $40

1 D.C. Public Service Commission; Washington Gas Application to Increase Distribution Rates – FC 1180;
https://dcpsc.org/Newsroom/HotTopics/Rate-Case-Applications/FC1180.aspx
2 D.C. Public Service Commission; Pepco “Climate Ready Pathway” Multiyear Rate Plan (CY 2024-2026) - FC 1176.
https://dcpsc.org/Newsroom/HotTopics/Rate-Case-Applications/FC1176.aspx
COMMITTEE ON HOUSING
ROBERT C. WHITE, JR., CHAIR
COUNCIL OF THE DISTRICT OF COLUMBIA

million,3 and applications for utility assistance programs continue to climb. A recent Lessons
Learned working group released a report in which the Apartment and Office Building
Association (AOBA), the Office of the People's Counsel (OPC), and other local government
representatives called for these reforms.4 And other states, including Maryland, have already
acted. This legislation would bring a necessary rebalancing of risk and responsibility, protecting
District ratepayers who have no choice in their utility providers.

3 Potomac Electric Power Company’s November 2025 Information on Disconnections for Nonpayment. Public Service
Commission e-docket number ARDIR2025-01 - 12
4 Formal Case No. 1176 – Lessons Learned Working Group Final Report.
https://edocket.dcpsc.org/apis/api/Filing/download?attachId=235360&guidFileName=b5cf40f9-d162-49e7-9022-
ffebbb6eef85.pdf

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_________________________ ______________________________ 4
Councilmember Brooke Pinto Councilmember Robert C. White, Jr. 5
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Councilmember Brianne K. Nadeau Councilmember Zachary Parker 11
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A BILL 15
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IN THE COUNCIL OF DISTRICT OF COLUMBIA 20
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To amend the Public Utilities Act of 1989 to require the Public Service Commission to approve 24
multiyear rate plans only if the plans are based on historic test years and do not include 25
reconciliation, specifies how excess return on equity will be refunded to customers, and 26
clearly demonstrates customer benefit, and to require the Public Service Commission to 27
approve gas infrastructure projects only if the company clearly demonstrates customer 28
benefit and that the company analyzed cost-effective alternatives, and to direct the Public 29
Service Commission to take into account any benefits the company realizes from 30
infrastructure project surcharges in future rate cases. 31
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BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this 33
act may be cited as the “Utility Rates and Ratemaking Amendment Act of 2026”. 34
Sec. 2. Paragraph 2 of section 8 of Chapter 150 of An Act Making appropriations to 35
provide for the expenses of the District of Columbia for the fiscal year ending June Thirtieth, 36
nineteen hundred and fourteen, and for other purposes, approved March 4, 1913 (37 Stat. 977; 37
D.C. Code §34-1101), is amended as follows: 38
(a) A new section 923 is added to read as follows: 39

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"Sec. 923. Rates and Ratemaking. 40
"(a) Unless otherwise authorized by law, the Commission may approve the use of a 41
multiyear rate plan for the distribution of base rates only if the plan: 42
"(1) Sets the proposed base rates on the basis of actual historic costs with 43
allowance for adjustments to reflect known and measurable changes in costs for the rate effective 44
period; 45
"(2) Does not allow for the public utility to file for reconciliation of cost or 46
revenue variances of the approved revenue component used by the Commission to establish just 47
and reasonable rates; 48
"(3) Clearly defines a mechanism for returning, refunding, or crediting any excess 49
return on equity to customers within a specified timeframe after the conclusion of the rate plan; 50
"(4) Provides a quantitative cost-benefit analysis demonstrating how ratepayers 51
can expect to see positive monetary net benefits of the investment; 52
"(A) The cost-benefit analysis shall include a summary of available 53
alternatives, and a description of why those alternatives were not pursued, in order to aid the 54
Commission's prudency review. 55
"(B) All non-confidential models, assumptions, and supporting data used 56
to justify a multiyear rate plan shall be made publicly available in the Commission's docket." 57
"(b)(1) For a gas company to recover costs associated with eligible infrastructure 58
replacement projects, a plan shall demonstrate: 59
"(A) A quantitative cost-benefit analysis demonstrating how ratepayers 60
can expect to see positive net benefits of the investments; and 61

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"(B) That the gas company has analyzed available cost-effective options to 62
defer, reduce, or remove the need to replace, construct, or upgrade components of the gas 63
company's distribution infrastructure, including leak detection and repair. 64
"(2) In a base rate proceeding after approval of a plan, the Commission shall, in 65
establishing a gas company's revenue requirements, take into account any benefits the gas 66
company realized as a result of a surcharge approved under the plan.". 67
Sec. 3. Fiscal impact statement. 68
The Council adopts the fiscal impact statement in the committee report as the fiscal 69
impact statement required by 4a of the General Legislative Procedures Act of 1975, approved 70
October 16, 2006 (120 Stat. 2038; D.C. Official Code § 1-301.47a). 71
Sec. 4. Effective date. 72
This act shall take effect following approval by the Mayor (or in the event of veto by the 73
Mayor, action by the Council to override the veto), a 30-day period of Congressional review as 74
provided in sections 602(c)(1) of the District of Columbia Home Rule Act, approved December 75
24, 1973 (87 Stat. 813; D.C. Official Code § 1-206.02(c)(1)). 76