PUC Notes Potentially Large Winter Cost Increases for Electric Customers Who Do Not Shop for Energy Suppliers; Urges Consumers to Check Their Utility’s ‘Price to Compare’ & Evaluate Alternatives
Published on 12/16/2019
Filed under: Electric
HARRISBURG – The Pennsylvania Public Utility Commission (PUC) is alerting consumers about the potential for large winter energy cost increases for electric customers who do not shop for competitive electric suppliers. To avoid the possibility of “sticker shock” from high bills during the coming cold months, the PUC reminds consumers that the start of winter is an important time to compare prices for electric generation and evaluate competitive supplier options.
Most Pennsylvania regulated electric utilities adjusted the price they charge for the generation portion of customers’ bills on December 1 for non-shopping (default service) customers, also known as the “Price to Compare” (PTC). The PTC averages 40 to 60 percent of the customer’s total utility bill. However, this percent varies by utility and by the level of individual customer usage. These recent changes in price range from a reduction of 6.3% to an increase of 24%.
As of December 1, electric distribution companies reported the following changes in their PTCs for residential customers:
- Penelec, up from 5.198 cents to 6.445 cents per kWh (24%);
Penn Power, up from 6.231 cents to 7.572 cents per kWh (21.5%);
- Met-Ed, up from 5.667 cents to 6.51 cents per kWh (14.9%);
- Citizens’ Electric, up from 6.5016 cents to 7.0986 cents per kWh (8%);
- West Penn Power, up from 5.338 cents to 5.76 cents per kWh (7.9%); and
- PPL, up from 7.585 cents to 7.632 cents per kWh (less than 1%).
The PUC noted that several other electric utilities, including UGI, Duquesne Light, PECO and Wellsboro Electric, have reduced their PTCs by 6.3%, 4.2%,1.4% and 1% respectively, though the PUC still encourages customers to explore their options in those service areas.
In most areas of Pennsylvania, consumers can choose who supplies their electricity, based on price or other factors, such as renewable energy.
Customers not choosing a supplier continue to receive default service from their local utility, with the cost per kilowatt hour (kWh) set quarterly or semiannually based on electric generation procurement plans developed by those utilities.
Note: The PUC does not regulate prices for the generation portion of electric bills, as generation is the production of electricity and not regulated by the Commission. For those customers that do not shop, electric utilities obtain default generation service using a procurement process overseen by the PUC – the electric utility in effect “shops” for the customer. Generation prices are separate from the closely regulated rates that utilities charge for their distribution services – the delivery of electricity to homes and businesses.
According to the PUC’s most recent electric switching report, more than 1.8 million (31 percent) residential and business customers currently have their electric generation provided by competitive suppliers – representing approximately 2/3 of the state’s regulated power load. In the residential rate class, more than 1.5 million customers (about 24%) are enrolled with competitive suppliers.
PAPowerSwitch.com, the PUC’s nationally recognized website for electric choice, provides consumers with valuable information on how to shop for electric supply services. The website enables consumers to quickly compare offers from competitive suppliers.
As another alternative for default service customers not participating in the competitive electricity market, Pennsylvania’s regulated utilities offer a voluntary Standard Offer Program (Standard Offer) - providing those customers with the option of receiving service from a competitive supplier at a fixed-price that is 7% below the utility’s current PTC. The Standard Offer price is fixed for one year and can be canceled by the customer at any time with no early cancellation or termination fees.
The Pennsylvania Public Utility Commission balances the needs of consumers and utilities; ensures safe and reliable utility service at reasonable rates; protects the public interest; educates consumers to make independent and informed utility choices; furthers economic development; and fosters new technologies and competitive markets in an environmentally sound manner.
For recent news releases and video of select Commission proceedings or more information about the PUC, visit our website at www.puc.pa.gov. Follow the PUC on Twitter – @PA_PUC for all things utility. “Like” Pennsylvania Public Utility Commission on Facebook for easy access to information on utility issues.
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