Press Release

HARRISBURG – Approximately half of PECO Energy’s commercial customers may be randomly assigned to alternative electricity suppliers under a plan approved today by the Public Utility Commission (PUC) to encourage electric competition in the Philadelphia area.

The “market share threshold” plan is a requirement of PECO’s 1998 restructuring settlement. It says the company must randomly assign half of its customers to alternative electricity suppliers if less than 50 percent of its customers had selected another supplier as of Jan. 1. As of the first of the year, approximately 7.7 percent of PECO’s 152,500 commercial customers were being served by another supplier.

“Today the Commission takes action in a matter of significant importance for Pennsylvania’s competitive electricity markets,” PUC Chairman Glen R. Thomas said. “I commend the parties for agreeing to a settlement that moves toward achieving the Commission’s intent to have at least 50 percent of PECO’s commercial customers being served by alternative generation suppliers. I believe that the settlement sets forth a reasonable proposal that is in the public interest.” (Chairman Thomas’ Statement)

Today’s plan was approved 4-1, with Commissioner Terrance J. Fitzpatrick dissenting (Commissioner Fitzpatrick’s Statement)

Commercial customers who are assigned to a new supplier – approximately 71,800 - will begin to receive service from that supplier beginning on May 1, with the majority of the customers receiving at least a 0.25 percent discount off of PECO’s price to compare. Customers will still receive one bill from PECO, who will include charges from the generation supplier. But a customer may request to receive a separate bill from the supplier.

While some customers will be assigned to a new supplier, they are not required to participate in the program. Customers can opt out by calling PECO or by returning a postage-paid, opt-out postcard that they will initially receive from the new generation supplier. Customers can also switch suppliers or return to PECO at any time without paying a switching fee.

Generation suppliers can bid on serving small commercial customers in blocks of 1,000 accounts or in blocks of 500 accounts for generation that includes renewable energy. Bidders for the renewable energy component must acquire at least 3 percent of their generation supply from renewable sources and are not required to offer a discounted rate below PECO’s price to compare. The minimum bid to serve large commercial non-interval metered accounts is 1 megawatt. Large commercial interval-metered customers are not being assigned, but offers can be made to them.

On Feb. 17, suppliers will receive information from PECO to make their bids, which must be returned by Feb. 21. PECO will announce the winning bids between Feb. 24 and Feb. 26. Customers will be notified by their new supplier between March 11 and April 8. The PUC may reexamine the bidding process if it doesn’t produce enough suppliers to serve at least 50 percent of PECO customers.

Today’s plan pertains only to commercial customers. A similar plan is required for residential customers, and is being developed in an official case before a PUC administrative law judge.

The Pennsylvania Public Utility Commission ensures safe, reliable and reasonably priced electric, natural gas, water, telephone and transportation service for Pennsylvania consumers, by regulating public utilities and by serving as responsible stewards of competition.