Press Release

PUC Approves Settlement for a Default Service Plan for Duquesne Light

Published on 6/21/2007

Filed under: Electric

HARRISBURG – The Pennsylvania Public Utility Commission (PUC) today approved a settlement for a new default service plan for Duquesne Light Co., which establishes generation rates for default service customers.

The Commission voted 4-0 to approve the settlement because it provides customers with reasonable default service rates and removes certain barriers to competition for each of the major customer groups. Commission Vice Chairman James Cawley issued a statement. The settlement was reached between the company and the formal complainants in the case which included consumer advocate groups, multiple electric generation suppliers, and large customer groups.

Under the settlement, Duquesne will rely on competitive wholesale market purchases to obtain power for the company’s default service customers. The settlement also eliminates declining block rates for residential default customers by Jan. 1, 2010.

The new generation rates will be effective from Jan. 1, 2008 to Dec. 31, 2010. The bill for an average residential customer using 600 kWh of electricity will increase from $ 75.47 a month to $80.59 a month (6.64 percent).

The 1996 electric competition law requires electric companies, or a Commission approved alternative supplier, to provide default electric generation service to customers who have not selected an alternative generation supplier. This is commonly called default service or provider of last resort service (POLR). The default service prices for electric generation service are required to reflect “prevailing marke t prices,” according to the law. Customers do have the right to choose an electric generation supplier other than Duquesne.

The generation rates for the state’s electric customers were capped as a result of settlement agreements reached during the state restructuring proceedings. Electric generation prices are not set by the PUC, but rather are set by the wholesale market, over which the PUC exercises no jurisdiction. Duquesne’s caps expired Dec. 31, 2001.  The existing default service plan for the company expires Dec. 31, 2007.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities to ensure safe and reliable utility service at reasonable rates; protect the public interest; educate consumers to make independent and informed utility choices; further economic development; and foster new technologies and competitive markets in an environmentally sound manner. For recent news releases, or more information about the PUC, visit our Internet homepage www.puc.state.pa.us.

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Docket No. P-00072247

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