D.C.’s top court has yanked the plug on Pepco’s latest rate hike, tossing out the Public Service Commission’s approval of the utility’s 2024 to 2026 multi-year plan and sending the whole thing back for a do-over.
Appeals Court Vacates PSC Approval
The District of Columbia Court of Appeals said in a D.C. Court of Appeals opinion that “We agree that this was a contested case which required the Commission to hold a trial-type evidentiary hearing,” and it vacated Order Nos. 22328 and 22358 and sent the case back to the PSC for further proceedings. The judges found the commission mishandled disputed factual questions by using a legislative-style hearing instead of taking sworn testimony and allowing cross-examination.
How the Commission Approved the Hike
Pepco filed its multi-year plan in 2023, and on Nov. 26, 2024 the PSC signed off on a modified version that allowed a $123.4 million cumulative increase over 2024 to 2026. That decision, recorded as D.C. Council Order No. 22328, drew petitions for reconsideration from the Office of the People’s Counsel and the Apartment & Office Building Association, which later took their fight to the Court of Appeals.
Advocates Hail the Ruling; Pepco Responds
As reported by WTOP, the Office of the People’s Counsel called the ruling “a victory for process and a victory for consumers,” arguing that regulators must build a transparent evidentiary record that includes sworn testimony and cross-examination. Pepco told WTOP it is reviewing the decision and “remains focused on providing safe, reliable and affordable service for customers in the District” while it works with the commission and other stakeholders.
What Comes Next for Customers
On remand, the court has ordered the PSC to run a trial-style evidentiary hearing, where parties can present witnesses, submit exhibits and cross-examine before the agency rules on any new multi-year plan. The case docket and pre-filed testimony are available through the commission’s eDocket system. The PSC will decide the schedule for new hearings and how to handle bills that have already included the higher rates since Jan. 1, 2025, so the real-world impact for customers is still up in the air.
Legal Implications
The court anchored its decision in the D.C. Administrative Procedure Act’s contested case requirements, emphasizing that when material facts are in dispute an agency must hold a trial-type hearing. The opinion signals that the PSC will have less leeway to rely on legislative-style proceedings for future multi-year rate cases and sets a clear procedural standard the commission will have to meet when it reconsiders Pepco’s plan, according to the D.C. Court of Appeals.
