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From response to District of Columbia’s Commissioner Beverly questions: 

[ *** ] To briefly recap, Commissioner Beverley, using his independent authority under D.C. Code § 34-802, sought DOEE’s input in developing an “error rate” to be applied to the bills of Pepco subscribers given that the Potomac Electric Power Company (Pepco) failed to timely provide required billing data. Pepco’s failure to provide billing data prevented the auditor from performing one the core purposes of the audit — to ensure CREF subscribers received all the credits they were due under the CREF program. Commissioner Beverly further inquired whether any error rate DOEE developed could be applied to all CREFs, or just SFA CREFs. Commissioner Beverley’s Inquiry sought similar information in relation to unsubscribed energy payments to DOEE and all CREF developers.

DOEE retained a contractor to specifically undertake this task. DOEE’s contractor developed several options for an error rate as set forth in the attached response. These options were based on an audit sample of eleven SFA CREFs using data that Pepco only made available to comply with Order No. 22415 (rel. May 7, 2025) post-audit. The methodologies and assumptions used to create these error rates are also described in the attached response (see attachment A to DOEE’s Response).

To summarize the conclusions in DOEE’s response, DCG recommends that the Commission adopt an error rate of $5.70 per month, per SFA subscriber, for each month that the subscriber participated in the SFA program during the audit period (ATO through August 2023). As described in more detail in DOEE’s response, this error rate represents the average amount of under-credits that SFA CREF subscribers in the CREF audit sample (eleven SFA CREFs) received in any month where an under-credit on one or more of the samples CREFs occurred.

For a subscriber enrolled in SFA for the entire audit period, adopting DCG’s proposed error rate would result in a lump sum credit of roughly $245 that could be applied towards that subscriber’s electricity bill each month until exhausted. DOEE estimates that the total amount of credits flowing to SFA CREF subscribers using this error rate would equate to roughly $1 million. If the methodology behind this error rate were extended to non-SFA CREF subscribers (i.e. the entire CREF market), the resulting total credits would amount to roughly $1.8 million. 

In addition, DOEE’s response contains several other recommendations to resolve this proceeding, which are likewise adopted by DCG. Notably, DOEE was unable to calculate an error rate for unsubscribed energy payments. More information, as set forth in the response, would be needed to do that – for both SFA CREFs and the CREF market as a whole. Another recommendation is to adjust the credit amounts to account for Pepco’s subsequent rate increases. In other words, because the error rate is based on rates that were in effect at the time, any reimbursement through a rate credit should amount to an equivalent bill offset in terms of kwhs, which have increased in the interim as a result Pepco being awarded another MRP. DOEE also requests that it be reimbursed for expenses entailed in developing its error rate proposal. Significant time and resources went into this endeavor. Lastly, DOEE believes the CREF program in general, and SFA in particular, would benefit from periodic audits of the accuracy of Pepco’s crediting and billing practices, which were the root cause of the mismatch. It should go without mentioning that none of Pepco’s costs to carry out these recommendations should be passed on to ratepayers.

When considering these recommendations, it is important to remember why these errors rates were developed. They were developed as a direct consequence of Pepco’s failure to provide required data despite repeated requests and only after being specifically compelled to do so by the Commission. The result of Pepco’s intentional failure was an auditing process that took far longer than necessary and ultimately undermined the very purpose of the audit. It therefore cannot be emphasized enough that DCG is recommending this error rate (and other listed items) in lieu of moving the Commission for penalties that would otherwise be warranted. 

Moreover, as DCG and OPC alleged in their Joint Petition, any pattern of under-crediting to subscribers results in reputational harm to the CREF program and SFA in particular. DCG believes Pepco should be held responsible for this ongoing conduct. DCG proposes the attached recommendations in full resolution of ongoing law violations that the Commission determined Pepco committed in Order No. 21600 (almost 2 ½ years ago). For these reasons, DCG believes that the foregoing error rate represents the fairest and most appropriate resolution to this protracted proceeding. [ *** ] 

DOEE Response  (09/24/2025) 
FC1171 (06/30/2022)
(In The Matter Of The Investigation Into Community Renewable Energy Facility Practices In The District)