Pepco Holdings Inc. Chairman and CEO Joseph Rigby announced yesterday he will step down as chief executive this year after a turbulent tenure marked by criticism over the company’s reliability.
Frank Heintz, lead independent director of the Pepco board, said the company has hired executive search firm Russell Reynolds Associates and expects to name a new CEO by the end of the third quarter of 2014. Rigby, 57, will remain chairman of the board until the company’s 2015 shareholders meeting.
“The board has been focused on senior executive succession for several years,” Heintz said in a statement.
Pepco delivers electricity and natural gas to about 2 million customers in Delaware, the District of Columbia, Maryland and New Jersey.
The company came under blistering criticism after widespread outages in the Washington region in 2010 and a Washington Post analysis found that the company’s customers suffered longer and more frequent outages than their counterparts in other major cities. One 2009 survey found the company’s customers experienced 70% more outages than customers of large urban utilities and the lights stayed out more than twice as long.
It was called the “most hated company in America” in 2011, based on the American Consumer Satisfaction Index.
Customer outrage led the Maryland legislature to order the Public Service Commission to hold electric providers accountable for service quality.
Rigby became chairman and CEO in 2009. He told the Post in an interview yesterday, “A lot of that criticism was, frankly, deserved.”
“This company needed to recognize that we had a hell of a lot of work to do to improve the day-to-day reliability,” he said.
Pepco doubled its budget for construction and infrastructure improvement between 2009 and 2012 and plans to spend $5.8 billion on infrastructure through 2018.
Rigby began his career at Atlantic City Electric, which Pepco acquired along with Delmarva Power, in 2002. He told the Post that although the company has boosted its reputation with customers and regulators, the perception of improvements is “somewhat tenuous.”
“That’s just a realistic view of the situation we’ve been in,” he said.
