Electric Rates Seen Stabilizing, or Falling: Utilities Able to Lower ...
Electricity rates in many parts of the United States will be stable or fall for the next 18 months and then will rise more slowly than the rate of inflation for the next decade, utility officials and observers say.</br></br>Utilities companies, such as Potomac Electric Power Co., Baltimore Gas & Electric Co. and Virginia Power, will be able to keep prices stable or lower them, they say. Fuel costs will be lower because of falling oil prices. A moderate increase in demand in the mid-Atlantic Region combined with a surplus of electricity available across the country-will mean there will be no immediate pressure to build expensive new generating plants.</br></br>ÛÏThe annual energy outlook shows electricity rates decreasing in real terms by an average 0.9 percent a yearÛ through 1995, said Mary Hutzler, director of the electric power division of the Energy DepartmentÛªs Energy Information Administration. She also said if the inflation rate is 3 percent, then electricity rates would go up only slightly more than 2 percent.</br></br>ÛÏThe two big components of electricity price are the capital and fuel costs and both nre trending down,Û said one Department of Energy official. ÛÏIt canÛªt help but mean lower electricity prices but it is going to be gradual.Û Fuel costs are falling because the collapse of OPEC is forcing down prices not only for oil but also for competing fuels. Capital costs are decreasing because of falling interest rates.</br></br>ÛÏWe do not anticipate filing for a rate increase in 1986 in any jurisdiction,Û said Nancy Moses, a spokeswoman for Pepco. "Our rates have stablilized for the past three