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PSC allows SMECO to retroactively bill KMC for $59,256.81 and directs Pepco to repair transformer
Summary
The commission authorized Southern Maryland Electric Cooperative to retroactively bill KMC Thermal LLC $59,256.81 for undercharges that extended beyond 12 months, and ordered Pepco to repair or replace the plant's three‑phase current transformer after staff said the underbilling resulted from a Pepco‑owned fault.
The Maryland Public Service Commission on Dec. 11 allowed Southern Maryland Electric Cooperative (SMECO) to retroactively bill KMC Thermal LLC $59,256.81 for undercharges found to have occurred for more than 12 months and directed Pepco to repair or replace the plant’s three‑phase current transformer.
Staff had recommended denying SMECO’s request to bill that portion of the undercharges because staff concluded the underbilling was caused by a faulty current transformer owned and maintained by Pepco and that, because KMC did not own the transformer, it was not reasonable to conclude KMC should have known the bills were in error. Eric Delgado explained staff’s finding that SMECO was unaware of the fault until a Pepco employee informed SMECO in August 2024.
SMECO counsel Mark McDougall said KMC — a long‑time customer — knew or should have known the readings were incorrect and renewed SMECO’s request to recover undercharges for the period from Oct. 5, 2022 through July 2023 (the >12‑month window). McDougall argued the regulatory standard (COMAR 20.50.0405) permits a utility to seek retroactive billing for multiyear undercharges when the customer knew or should have known of the error.
KMC’s plant manager, Jerry Ramsey, testified he had notified Pepco in 2022 that out‑meter readings appeared low and said KMC had already agreed to pay roughly $100,000 toward the total underbilled amount the parties discussed (the full unbilled period 10/05/2022–07/31/2024 was reported in filings as $158,444.62).
After discussion, the commission voted to allow SMECO’s request to retroactively bill the $59,256.81 portion that occurred more than 12 months but less than three years and directed Pepco to repair or replace KMC’s three‑phase current transformer. Commissioners recorded ayes and the motion carried.
What this means: SMECO may recover the $59,256.81 identified for the >12‑month underbilled period and Pepco must proceed to repair or replace the faulty transformer per the commission’s direction. Staff will monitor compliance and Pepco’s restoration work.
