FOR IMMEDIATE RELEASE Contact: Jeanne K. Clark
March 19, 1998 412/421-6072
Average Residential Customer Could Save $156 per Year
Pittsburgh, March 25 – Citizen Power, a Western Pennsylvania public policy, advocacy and education group, today released a national comparison study on electric rates and shareholder return, which proves that Duquesne Light Company (DQE) could drop its current residential rates by over 20% and still make a reasonable profit. The study also showed that Duquesne Light charges far higher rates and produces more profits than all but one of the 101 surveyed companies.
“Since 1988, Duquesne Light customers have paid over $1 Billion more than the national average for electricity while the company enjoyed soaring profits” said David Hughes, Executive Director of Citizen Power. “But this gravy train must end. Pennsylvania law requires that risks and benefits be shared by all – the company, investors and customers. It is time for Duquesne to share the wealth, not just the bills.
“Our study proves that Duquesne could lower the residential electric customers’ rates by 21.12% and still enjoy reasonable profits. That cut means that the average customer would save $156 each year.
“If Duquesne Light won’t do the right thing and lower their rates, the Pennsylvania Public Utility Commission (PUC) should order them to. And in light of the $1 Billion overcharge that customers have already suffered, the PUC should deny Duquesne’s current request for recovery of so-called stranded costs,” continued Hughes.
The Citizen Power study, compiled by Dr. William Carlson, Assistant Professor of Business Finance at Duquesne University, is designed to evaluate DQE’s request to the PUC to keep their current high rates in place throughout the transition to retail competition (until 2005). DQE has asked for this nearly $2 Billion in so-called stranded costs to cover bad investments made earlier that will be unrecoverable in a free market environment. A decision will be handed down by the PUC on May 28, 1998.
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NOTE: Copies of the Executive Summary, as well as the complete study are available from Citizen Power by calling 412/421-6072 or electronically by emailing Energyflak@aol.com