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This next company is responsible for delivering power to more than one million Americans call Pepco Holdings ticker symbol PO -- traits on the New York Stock Exchange just at a 52 week -- -- Tuesday.
And this energized company is using its capital to pump up our nation's smart grid.
How will they do it.
Why did they raise rates at a time when many consumers are clutching their wallets maybe because they can't joining us now from Washington DC in a box of this exclusive Joseph -- The chairman and CEO of Pepco Holdings deceived Joseph thanks for being here and and we -- because.
You're company that actually got stimulus money -- a 168 million dollars of it and you're putting it to work.
To save your consumers money tell me how that is proceeding.
Sure well it's going really well and thanks for having me on.
About 45 years ago we recognize and energy prices were likely gonna go up.
And we wanted to put in place not only assets but also rate structure that would help us help our customers save money.
So we've been putting technology in place we've been very active as you -- we were we're very fortunate.
To get the stimulus dollars which was part of an overall close to a 500 million dollar investment which is gonna save our customers money.
But about three or four years ago we actually put in place innovative rate structure called decoupling.
Which breaks the connection between the volume of consumption to the revenue that we get which really aligns our interest in helping promote energy efficiency.
And at the end of the day helping our customers save money even while we get the very good return on our -- So -- -- the Wall Street Journal doesn't economics -- conference in the first year in early 2008 -- we talked a lot about the smart grid a lot of companies try to get -- on that explain to our viewers right now how it would change their world.
It tells you that the cheapest time to be doing your loads of laundry -- might not necessarily be the time you'd think it would be.
Well let me tell you something that most people don't know.
And part of what's gonna come out of this mark rate for the first time we're actually gonna know when your powers out.
Most people think that we know that automatically.
Today we're still dependent on receiving a phone call so right off the get -- customers are gonna get -- much faster response time because we're gonna know when you're -- -- also going to be able to.
Use technology to really have the system heal itself.
But part of what we're going to do going forward is to put as you -- What's called dynamic pricing which is going to send price signals to our customers such that they'll be able to modify their behavior.
And hopefully use -- hopefully use the energy doing a less -- time of the -- It's -- let me just say though you're saving them money and then in certain regions you are raising rates is this the time to be doing -- -- you getting -- back.
To some extent but not that much I think people understand that were -- making investments to improve reliability in the system.
To deal with low growth to help deal with the expansion of necessary transmission.
And you have to also understand that the part of the business that we run.
It's about 25% of the overall electric bill so we can help them save money on the top 75%.
On all when the overall bill basis cost can go down well -- Listen you're doing good business you're you're up 29% year over year for the stock.
You what -- your profits in the first quarter you had a 52 week high on Tuesday that's all great but you know I have to ask you this question because.
We -- talking a lot of companies about tax reform in the tax code and all of that.
You paid markedly.
Less in taxes this year than you did back in 20092009.
You pay about a 104 million in income tax.
This that if for 2010 you paid just eleven million year I got your CPA -- an accountant argue -- figuring out ways not to pay income taxes -- issued.
It's not a General Electric and ExxonMobil not paying their fair -- Now I think it's a very fair question let me answer -- directly.
We actually -- significant loss last year.
When we actually sold apart and we actually sold our generation assets at a loss so that was actually part in terms of when you look at 09 ten.
In terms of what -- the tax payment down just an uptick here year.
So but in the future you're not one of these companies it's figuring out a way to weasel out of paying income taxes because no ring no not not specifically for -- -- Joseph but because.
We we've got to talk to people about everybody paying their fair share her.
Now and we absolutely buy into that we also recognize how important that tax payment plays into the local and even the federal economy.
This is not a company I wouldn't be part of a company that's trying to play some tax scheme now.
You're good Jersey boy went to Rutgers good this year -- that thank you very -- Don't -- right now is the chairman and CEO of Pepco Holdings we'll have you back we've got breaking news.