WASHINGTON (Reuters) - A nearly $1 billion plan to bury power lines in the District of Columbia was recommended on Wednesday by a task force set up last year after widespread storm outages.
The interim multi-year plan would bury up to 60 high-voltage Pepco Holdings Inc lines in the U.S. capital that are most affected by storms and overhead-related outages, Mayor Vincent Gray said in a statement.
"This proposal is a win for the District," said Gray, who appointed the panel. About half the District of Columbia's power lines are underground.
The 15-member task force included Pepco Chairman, President and Chief Executive Joseph Rigby. It recommended that the District put up 50 percent of the needed financing and Pepco put up the rest of the financing.
The arrangement would combine traditional Pepco funding of debt and equity for $500 million and $375 million in District-securitized bonds. Another $62 million to $125 million would come from District Department of Transportation street-paving funds.
The District of Columbia's Public Service Commission has to approve the plan.
For residential customers, rate increases will start at about $1.50 per month. They will increase to a maximum of $3.25 after seven years, or about a 3.23 percent rise.
Low-income customers will be exempt from rate increases. For commercial customers, hikes will generally average between 5 percent and 9.25 percent, the statement said.
Gray set up the panel after violent thunderstorms knocked out power to millions of power customers in the eastern United States in late June 2012, including thousands in the District of Columbia.
(Reporting by Ian Simpson; Editing by Leslie Gevirtz)