WASHINGTON. If your Pepco or Washington Gas bill keeps climbing, the D.C. Council voted Tuesday to go after the part of it that is profit.
The Council gave unanimous first approval to the GRID Act, a 43-page bill from Ward 6 Councilmember Charles Allen that targets the guaranteed profit in utility rates, expands the utility commission, and reins in companies that sell power door to door. A final vote is expected later this month.
By Mayor Muriel Bowser's own energy plan, the average D.C. household's utility bills rose 56 percent between 2022 and 2025, and higher supply costs alone added about $9.56 a month to the average Pepco bill in July.
What the bill does
The bill, B26-0602, the Guiding Renewable Interconnection and Distribution (GRID) Amendment Act of 2026, centers on the return on equity, in plain terms the profit rate regulators promise a utility on the money it invests in poles, wires and pipes. The Public Service Commission, the panel that approves or rejects rate increases, now allows Pepco 9.5 percent and Washington Gas 9.65 percent, according to the city's chief financial officer.
The bill orders the commission to reset that rate using a new yardstick: the yield on a 10-year U.S. Treasury bond plus 2 percentage points, about 7 percent at today's yields. The commission could choose a different yardstick only if it saves customers about the same, and the utility would have to prove a lower profit cannot attract investment. That is more than a suggestion, but not a number fixed in law, and it would bite only at a utility's next rate filing.
The bill also:
• Expands the Public Service Commission from three members to five: one seat for grid and renewable energy expertise, one for consumer protection.
• Bars the commission for 18 months from approving rates built on forecast test years, the projected costs behind multiyear rate plans. That pauses new multiyear plans while regulators weigh which method treats customers best.
• Caps third-party energy suppliers, which sign up residents at the door or by phone, at 110 percent of the standard Pepco supply price. A contract above the cap would be void, and suppliers could no longer charge fees for canceling early.
• Creates virtual power plants, which pay homes and businesses to lend the grid power from batteries, smart thermostats and electric cars at busy hours, cutting demand instead of building more capacity.
• Lets renters plug in small balcony solar panels without Pepco's approval process, and speeds up rooftop solar connections.
What supporters say
Allen's case rests on one claim: too much of your bill is guaranteed profit. "It's estimated that about 15% of your bill is the profits for utilities," he said. "They can still make 7% profit." The city's own math backs him: the chief financial officer estimates the new profit rate alone would cut bills by about $42 million a year for electricity and $10 million for gas, roughly $52 million in all. Mayor-elect Janeese Lewis George, who campaigned on utility prices, backed the bill, saying residents "asked us to do something around the affordability of utilities."
What the utilities say
Pepco and Washington Gas fought the profit provision hardest, warning that a lower guaranteed return makes borrowing for grid work costlier. Restricting profit would raise borrowing costs, Pepco argued, "ultimately putting upward pressure on customer bills." Washington Gas was blunter: "There is no evidence from any jurisdiction that legislatively restricting a utility's authorized return on equity lowers customer bills," wrote Brandon Todd, a Washington Gas vice president. Pepco backed other parts, including virtual power plants. Ward 7 Councilmember Wendell Felder worried about "unintended consequences" but voted yes, as did everyone else.
What it means for your bill
Do not expect relief soon. The financial officer assumes savings begin in fiscal year 2028, since the new profit rate applies only at a utility's next rate case, which could be a year or two away. Spread citywide, that is a few dollars a month for a typical household: real, but modest. The analysis also warns that higher borrowing costs could eat into the savings, and that the bigger commission would cost about $8.2 million over four years, passed on to customers through utility charges.
What happens next
After the final vote, the bill goes to Mayor Bowser for her signature, then to Congress for the standard 30-day review of D.C. legislation, which Congress can block only with a resolution signed by the president, a rare step. If the bill becomes law, the commission would have six months to begin resetting the profit rate.
Has your Pepco or Washington Gas bill gone up this year, and by how much? Is trimming the profit built into your bill the right way to bring it down? Tell us.
Reporting note: This story is based on the text of Bill 26-0602 (committee print approved November 4, 2026) and the D.C. Council committee memorandum for the November 10, 2026 legislative meeting; the fiscal impact statement issued by the Office of the Chief Financial Officer on November 4, 2026; Mayor Bowser's Energy Affordability Action Plan (July 2026); Public Service Commission notices on standard offer service rates; and reporting by The Washington Sun, including statements from Councilmember Charles Allen, Mayor-elect Janeese Lewis George, Washington Gas and Pepco. A Pepco letter to the Council dated October 23, 2026 was quoted as reported by the Barras Report.
