PUC Urges Consumers to Prepare for Rising Winter Energy Costs and Explore Options for Conservation and Savings
The Pennsylvania Public Utility Commission (PUC) is alerting consumers and small businesses that most utilities will be adjusting their prices for electric generation on December 1st – with potentially large winter energy cost increases in some areas for non-shopping (default service) customers.
To avoid the possibility of “sticker shock” from high bills during the coming cold months, the PUC reminds residential and commercial customers that the start of winter is an important time to compare prices for electric generation, evaluate competitive supplier options and explore ways to conserve and save.
“The upcoming price changes, combined with falling temperatures, make this an important time for consumers and businesses to evaluate their energy options and explore ways to save money and energy in the coming months,” said PUC Chairman Gladys Brown Dutrieuille. “We encourage consumers to carefully review their electric bills, understand the energy prices they will be paying if they stay with default service, and then explore the PUC’s official electric shopping website - PAPowerSwitch.com - for details on competitive offers, along with tips for energy conservation and savings.”
Most Pennsylvania regulated electric utilities are adjusting the price they charge for the generation portion of customers’ bills on December 1 for non-shopping customers, also known as the “Price to Compare” (PTC). The PTC averages 40% to 60% of the customer’s total utility bill. However, this percent varies by utility and by the level of individual customer usage.
The PUC notes that the Commission does not regulate prices for the generation portion of electric bills. 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.
“Price to Compare” Changes for Residential Customers
In most areas of Pennsylvania, consumers can choose who supplies their electricity, based on price or other factors, such as renewable energy.
Beginning December 1, electric distribution companies report the following changes in their PTCs for residential customers:
- Citizens’ Electric, up from 6.9777 cents to 7.9476 cents per kWh (13.9%);
- Duquesne Light, up from 7.41 cents to 7.98 cents per kWh (7.7%);
- Met-Ed, up from 7.114 cents to 7.414 cents per kWh (4.2%);
- PECO, up from 6.597 cents to 7.021 cents per kWh (6.4%);
- Penelec, down from 6.761 cents to 6.507 cents per kWh (3.8%);
- Penn Power, down from 7.657 cents to 7.593 cents per kWh (less than 1%);
- PPL, up from 7.544 cents to 9.502 cents per kWh (26%);
- Pike County Light & Power, up from 6.5234 cents to 9.796 cents per kWh (50.2%);
- Wellsboro Electric, up from 7.2596 cents to 7.5051 cents per kWh (3.4%); and
- West Penn Power, up from 5.447 cents to 5.698 cents per kWh (4.6%);
Standard Offer Program
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.
“We have found that the Standard Offer can be a ‘win-win’ for the electric shopper and supplier alike,” Chairman Brown Dutrieuille said. “The customer benefits with potential savings on electric generation over the course of a year, with no added fees and little or no risk, while the supplier gains a new customer now actively participating in the competitive retail market.”
Customer Review of Electric Bills and Supplier Contracts
It is important for every utility customer to understand what they are paying for electric generation supply, either through default service from their electric utility or a contract with a competitive energy generation supplier. Key questions to ask include:
- How do competitive suppliers’ rates compare with the utility’s Price to Compare?
- Is the supplier contract for a fixed or variable rate – and if the rate is variable, what are the conditions of changes in the price for electricity?
- Does the contract provide for additional fees – such as membership or early contract termination fees?
- When will the contract expire – and what are the options for consumers as the contract end date approaches?
The PUC’s PAPowerSwitch energy shopping website provides consumers and small businesses with valuable information on how to shop for electric supply services – enabling consumers to quickly compare offers from competitive suppliers against the default service rate from their local utility and learn more on switching to a competitive supplier, or returning to default service, should they choose.
Consumers are advised not to sign a contract without knowing the length of the contract, the price, whether it is fixed or variable and if there are any fees. Information on fixed and variable electric rates is available here.
For small business customers, the PUC notes that most EDCs are also adjusting their prices to compare in their small Commercial and Industrial rate classes. Among the state’s major EDCs, default service rates for small businesses are increasing on December 1 – ranging from an increase of 36% in the PPL service territory to a 4% increase in Duquesne Light’s service territory.
PUC Continues Encouraging Energy Efficiency & Conservation
The PUC also reminds families to explore energy conservation to help manage bills and reduce energy usage. PAPowerSwitch, as well as the PUC’s website for natural gas shopping, PAGasSwitch.com, have interactive information and tips for saving energy.