October 28, 2012
The idea is as follows. Montgomery County Government will work with the PSC, Pepco and a team of outside experts to design a new grid serving tens of thousands of Montgomery County residents. The experts come from a team of utility sector thinkers who are working with municipalities around the country to revolutionize how we manage power at the grid level. We heard from this team at the Council committee.
The demonstration grid would involve Pepco in making enhancements that Pepco might not have made, with an eye towards gradually transforming the entire grid in Montgomery County.
The new grid would have different kinds of switches and infrastructure to enable it to be repaired more quickly, user energy more efficiently, and even draw from locally-generated power (solar or geothermal, for example).
Grids like this do exist, particularly in jurisdictions that have publicly-owned power. We have an investor-owned grid (Pepco). While we are pushing forward on public power, we need to work with Pepco now because there are ways we can achieve better service by working together.
In order to implement this project we will need support from the PSC and the Governor, the County Executive and Council, and collaboration from Pepco.
At the same time, this does not distract from the shorter term game plan that has been outlined by the PSC for how to force Pepco to improve its service. That plan is as follows: The PSC has required Pepco to reach improved reliability standards. If Pepco does not reach those improved standards, it will be fined and it will also not receive certain rate hikes; and the PSC may reduce the rate of return that Pepco is allowed to charge. Additionally, Pepco will not be allowed to charge rate payers for investments that it should have been making when it was rewarding investors and neglecting its infrastructure.
That policy or regulatory agenda for the PSC is our best shot to force Pepco to improve over the short term. I think this demonstration project is a fantastic opportunity to transform our grid over the long term and give residents not only a higher quality of service, but also a grid that can serve as a platform for innovation in service delivery, customer control, environmental responsibility, and sustainability.