Business & Tech

PECO: Expect 10 Percent Electric Bill Hike on New Year's

Utility spokesperson explains increase at Manayunk Neighborhood Council meeting.

Citing energy deregulation, a PECO spokesperson told residents their electric bills will most likely increase 10 percent starting Jan. 1, 2011.

Speaking to Manayunk Neighborhood Council members Sept. 1, PECO's Ray Moffo said removal of a regulatory cap in Pennsylvania, which will open electric pricing to market rates, and increased operating expenses will cause the estimated $8-a-month hike for average consumers.

"By the time the Mummers are walking down Broad Street, the caps are gone and prices will go up," Moffo said.

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According to the Pennsylvania Public Utility Commission, deregulation—affecting all electricity providers in the commonwealth—was sought to empower residents to shop among energy generators for the most favorable rates.

"In some areas, the [electric generation supplier] rate is as much as 10 percent cheaper than the default service price offered by the utility," according to a recent document.

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In 1997, the commonwealth opened utilities to the fair market and slowly moved consumers toward free energy choice. Today, caps on transmission and distribution have expired. The Jan. 1 generation cap removal will allow customers to buy directly from electric generator—with the potential to save on their energy bill. No matter what, PECO will still supply the energy.

Throughout Pennsylvania, generation caps have been removed from seven electric companies—including PPL Electric Utilities. As of July 1, more than 386,00 residential PPL customers have switched, according to the Office of Consumer Affairs.

Many electricity generators only offer competitive rates to industrial or commercial customers—which could limit residential PECO customers' options. 

The convoluted process of energy pricing is a lot to sift through. According to Moffo, that's why PECO has been out in the community all year, attempting to prepare customers. Last week at the Venice Island Recreation Center, Moffo delivered a PowerPoint presentation and fielded questions from Manayunk residents.

"We have an obligation to people throughout southeastern Pennsylvania, especially in this economy. We have to get the word out," Moffo said.

Although Moffo said PECO's "proactive" stance had reached many communities, he would not discuss internal mechanisms the utility company may or may not have employed to keep costs down. Instead, Moffo attributed rising industry costs to the increase—an aspect the commonwealth's utility board approved in March 2010.

To combat costs, Moffo offered several energy tips—from large-scale appliance purchases to simple habit adjusters. Moffo said customers could trim energy bills up to 25 percent by unplugging electrical devices not in use. The "phantom draw" from computer monitors, microwave clocks, VCRs and other appliances is significant, he said.

He also advised exploiting sunlight in the winter, turning to air dry over heat dry, and dialing down temperatures on hot water heaters. PECO created an energy- saving ideas website customers can turn to for more tips. 

Residents interested in switching energy generators may visit the Office of Consumer Advocate's website or the public utility's PA Power Switch page. 


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