Filed Pursuant To: Rule 424(b)(3)
Registration No.: 33-61379
Pricing Supplement No. 1 Dated December 11, 1996
(To Prospectus dated August 14, 1995 and
Prospectus Supplement dated December 10, 1996)
POTOMAC ELECTRIC POWER COMPANY
MEDIUM-TERM NOTES, SERIES A
(FIXED RATE)
DUE FROM 9 MONTHS TO 30 YEARS FROM DATE OF ISSUE
Principal Amount................................. $100,000,000
Original Issue Date.............................. December 16, 1996
Maturity Date.................................... December 17, 2001
Price to Public (As a % of Principal Amount)..... 100%
Interest Rate.................................... 6.53%
Interest Payment Dates........................... February 1 and August 1
Initial Redemption Date.......................... Not applicable
Initial Redemption Percentage.................... Not applicable
Annual Redemption Percentage Reduction........... Not applicable
Refunding Rate................................... Not applicable
Limitation Date.................................. Not applicable
If an initial Redemption Date has been specified above, the Medium-Term
Notes to which this Pricing Supplement relates (the "Notes") will be
redeemable as a whole or in part, in increments of $1,000 (provided that any
remaining principal amount of any such Note shall be at least $1,000), on the
Initial Redemption Date or on any date subsequent thereto, at the option of
the Company upon not more than 60 nor less than 30 days' previous notice, at
the applicable redemption price set forth below, with accrued Interest to the
date of redemption; provided, however, that if a Limitation Date has been
specified above, no Notes shall be redeemed prior to the Limitation Date
specified above as a part of, or in anticipation of, any refunding operation
by the application, directly or indirectly, of monies borrowed having an
interest cost to the Company (calculated in accordance with generally accepted
financial practice) of less than the Refunding Rate specified above. The
redemption price shall initially be the Initial Redemption Percentage
specified above of the principal amount of the Notes to be redeemed and shall
decline at each anniversary of the Initial Redemption Date by the Annual
Redemption Percentage Reduction specified above of the principal amount to be
redeemed until the redemption price is 100% of such principal amount.
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
(Merrill Lynch) and Goldman, Sachs & Co. each have severally agreed to
purchase $50,000,000 in principal amount of the Notes as principal from the
Company at a price of 99.50% of the aggregate principal amount thereof for
resale to investors and other purchasers as set forth herein.
