Electric bills growing costlier as supply rates increase

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HARRISBURG — Electricity supply rates might shock customers this summer when paying the bill.

The Pennsylvania Public Utility Commission warns that charges for electric generation will rise beginning June 1 from 6% to 45% on those consumers who don’t shop for suppliers in the online marketplace.

Residential customers who use PPL as a default supplier, for example, will see their bill rise by about $34, according to Tracie Witter, PPL regional affairs director.

Customers seeking savings through a new supplier, however, will be hard-pressed to find it.

A search through the offerings at the online marketplace PAPowerSwitch.com shows limited options for rates cheaper than the default costs electric distributors like PPL will charge starting next month.

Many rates from independent suppliers, with varied terms and fees, are higher.

“Like most Pennsylvanians, I am concerned with the impact that rising energy prices have on consumers’ ability to afford their electricity bills,” Pennsylvania’s Acting Consumer Advocate Patrick Cicero said in a press release.

PUC provides a list of electric distributors whose rates are changing on June 1. It includes the current cost, the impending cost and the percentage increase: Citizens’ Electric, 7.3995 cents to 9.3667 cents per kilowatt hour (kWh), 26.6%; Met-Ed, 6.832 cents to 7.936 cents, 16.1%; Penelec, 6.232 cents to 8.443 cents, 35.4%; Penn Power, 7.082 cents to 8.694 cents, 22.7%; PPL, 8.941 cents to 12.366, 38.3%; Wellsboro Electric, 7.7569 cents to 9.592 cents, 23.7%; West Penn Power, 5.667 cents to 8.198 cents, 44.6%.

A distributor is just that: A company that distributes electricity and maintains the infrastructure needed to do so. PPL, for example, doesn’t own supply operations. It also can’t profit off of default supply rates, PUC says, which are set at auction for such companies.

The supply rates for other distributors are rising, too, but haven’t yet been finalized. That includes Duquesne Light, PECO and Pike County Light & Power.

The rate hike arrives ahead of the start of summer. The hotter months cause greater demand for electric service.

John Banghoff, meteorologist with the National Weather Service, said overnight temperatures can have a greater influence on electric bills. The warmer it is overnight, the longer fans and air conditioners are in use.

“Recent trends show overnight low temperatures now tend to be quite warm,” Banghoff said. “Warm overnight lows tend to be one of the big problems for energy.”

Shopping online

Look at an electric bill. There are two portions for which consumers are charged: Supply and delivery.

The supply portion is referred to as the “Price To Compare.” The price is the charge for each kWh consumed, and it’s rising, PUC says, due to higher wholesale market prices for electricity.

Witter said PPL encourages its customers to shop for suppliers. She and Cicero each cautioned that online shoppers must mind the details before striking an agreement.

“We would certainly recommend a fixed rate. We’d also recommend a company that doesn’t have termination fees and cancelation fees,” Witter said.

Rates vary, in part, depending on the supplier, use — residential or business — and location.

For residential service in PPL’s service area in Central Pennsylvania, just 10 out of approximately 100 offers had lower rates than the price the utility company will charge starting June 1. Three subscription-based offers don't use a monthly rate but project lower costs.

The price structure can be varied, fixed, or in certain cases, unlimited. Some companies charge fees to enroll or cancel service or assess a monthly fee. Discounts and introductory prices may be offered.

Among Cicero’s suggestions, he says customers should consider enrolling in a utility’s standard offer or customer referral program: A 12-month fixed-rate contract that offers 7% off the utility price at the time of enrollment. And, he says, keep track of when a generation contract ends. Once it does, the price can spike.

Witter referred customers to pplelectric.com/shopsmart for information on finding electric suppliers. The company also maintains savewithppl.com, where customers can find offers like billing assistance programs, both income-based and universal, along with payment agreements, budget billing and temporary hardship programs.

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