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Pennsylvania Electric Utilities to Consider Longer-Term Fixed Rate Under New PUC Tentative Order

In Pennsylvania, the state’s Public Utilities Commission (PUC) is reconsidering how electric default service rates for residential and small commercial customers are adjusted.

Under current PUC guidelines, electric utilities such as PECO and PPL, which are known in the state as electric distribution companies (EDCs), adjust their default electricity rate quarterly, or once every three months. Under the tentative order from the PUC, EDCs would be required to adjust their default rate semi-annually, or once every six months.

The PUC’s tentative order, based on recommendations from the Commission’s investigation of the state’s retail market, is subject to a public comment period before final language is adopted. According to the tentative order, the PUC is weighing the benefits of six-month electricity rate and reconciliation adjustments versus three month adjustments.

The PUC’s tentative order is seeking comment on a series of recommendations that would go into effect June 1, 2013, when the EDCs’ next default service plans begin, which seek to align changes in retail market design with default service plans offered by EDCs.

Recommendations include filing default service plans that run for two years, limiting the proportion of long term contracts that make up default service plan energy portfolios — while avoiding mandating prescriptive contract lengths in portfolios — and incorporating an opt-in retail auction program within default service plans that would allow customers to indicate their willingness to be served by a retail electric supplier though an auction process. Other recommendations include incorporating a customer referral program within EDCs’ default service plans.


“Pennsylvania PUC to Order Utilities to Consider Longer-Term Fixed Price,” Energy Choice Matters, Oct. 17, 2011.

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