Pepco will face tightened reliability standards in the District of Columbia as well as potential penalties for poor performance, under new rules adopted last week by the District’s Public Service Commission. The adoption of the new Electric Quality of Service Standards in a July 7 ruling is one of several measures taken by the Commission to improve Pepco’s service reliability and hold Pepco accountable for its performance. The new rules will take effect upon publication in the D.C. Register later this month.
The new rules adopt a penalty provision designed to encourage Pepco to improve its performance while allowing the Commission to retain flexibility. Further, in its March 2010 decision on Pepco’s request to increase distribution rates, the Commission put Pepco on notice that reliability could be considered the next time Pepco rates.
In addition to the penalty provision, the new rules set more stringent benchmark levels for reliability performance. The new rules amend section 3603 of chapter 36 of title 15 of the District of Columbia Municipal Regulations, which sets specific reliability targets. The targets are calculated using District-only data, for two reliability indices:
- System Average Interruption Frequency Index (SAIFI), which measures the average number of customer outages for a system; and
- System Average Interruption Duration Index (SAIDI), which measures the average duration of system outages.
The new rules require gradual improvement in Pepco’s reliability performance on a yearly basis beginning in 2013. Pepco must improve its SAIFI performance by 9% each year, and its SAIDI performance by 3.4% annually. The goal is for Pepco to rank in the top tier of electric distribution systems by 2020.
In a related matter, the Commission is also investigating the reliability problems of particular District neighborhoods identified by Pepco as most susceptible to outages. According to Pepco, these neighborhoods have suffered the most non-major service outages in the last two years. The Commission issued its second order in this matter, Order No. 16426, directing Pepco to respond to additional questions on three areas identified as affecting reliability the most: equipment, vegetation management, and load growth.