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Virginia Default Service Rates
Questions and Answers
Frequently Asked Questions
Q
What is Default Service?
A
Since 2002, Virginia customers have had the right to choose an electricity supplier other than Delmarva Power for their electric supply. If you don't choose a supplier, Delmarva Power buys electricity for you and charges you according to rates set by the Virginia State Corporation Commission. This is called "Default Service," and the cost for this appears in the "supply" portion of your bill. Delmarva Power continues to deliver the electricity to all customers whether or not they choose another supplier.
Q
Why are electricity rates proposed to increase?
A
The current contract Delmarva Power has with its energy supplier will terminate on December 31, 2004. Delmarva Power solicited bid proposals for a new contract with an energy supplier. Based on the bid proposals received, the energy supply costs are increasing which will result in an electricity rate increase. The contract has been awarded to the lowest bidder.
Q
Why is the new energy supply contract more expensive?
A
Rising fuel costs are pushing energy supply prices higher because many of the fuels are used to produce electricity.
Q
When are electricity rates expected to increase?
A
We don't know. Delmarva Power filed its rate case with Virginia's State Corporation Commission on October 26, 2004. The new contract with the supplier at the new price will take effect January 1, 2005. Delmarva Power has asked for the rate change to take effect on January 1, 2005, pending regulatory approval.
Q
How much are rates increasing?
A
· RESIDENTIAL:
That is for the Commission to decide. We requested a residential total bill increase of 13.6 percent. While the individual impact would depend on usage, the average total bill would increase about $10 a month.
· COMMERCIAL & INDUSTRIAL:
That is for the Commission to decide. We requested a total annual bill increase ranging from 14 percent to 20 percent for small commercial and small industrial customers, and ranging from 13 percent to 25 percent for large commercial and large industrial customers, recognizing that the individual customer's impact depends on usage.
Q
Are we going to see rate increases every year?
A
Fortunately, Delmarva Power has managed to keep the ever-increasing costs of fuel products from affecting its Virginia customers over the last couple of years. In fact, electricity rates for Delmarva Power's Virginia customers decreased three times in 2000 and 2001. Rates then remained unchanged until a small reduction in 2003. The new contract will keep the rates stable for at least a year. Future fuel costs will largely dictate the customer energy supply rates.
Q
How can I minimize the impact?
A
Become a wise energy user. From this web site, link to YOUR HOME and adopt the recommended wise energy practices to save on energy costs in your home.
Q
How can I get a list of electricity suppliers in the market?
A
The Virginia State Corporation Commission maintains a list of suppliers that are participating in Delmarva Power's service territory on its web site at www.yesvachoice.com.
Q
What happens if I don't choose a supplier?
A
If you do not choose a competitive service provider of electricity, Delmarva Power will continue to both supply and deliver electricity to you. You can choose a competitive service provider of electricity at any time.
Q
How does the increase in the price of electricity compare to price increases of other energy products?
A
Prices for other energy products have increased significantly over the past four years, including natural gas, up 46 percent; oil, up nearly 70 percent; gasoline, up almost 60 percent and coal, up nearly 82 percent. Several of these fuels are used to produce electricity and none of these increases have been reflected in your bills to date. Electricity continues to be a good value for its benefits.
Q
Who will deliver my electricity if I choose another supplier?
A
Delmarva Power will continue to deliver your electricity over the existing system of overhead and underground wires, even if you select a different electricity supplier.
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