Power rates are going up

May 22 - McClatchy-Tribune Regional News - Andrew M. Seder The Times Leader, Wilkes-Barre, Pa.

For the first time since the state's electricity rate caps expired in 2010, PPL Electric will raise its "price-to-compare" rates beginning June 1.

But even with the 15 percent increase, the average PPL residential customer will still pay less this summer than last summer or at any point since, 2010.

The new price-to-compare rate, which the Public Utility Commission did not object to, will be 7.993 cents per kilowatt-hour (kWh), up from 6.935 cents per kilowatt-hour currently. For the average residential customer using 1,000 kWh per month, the increase equates to about $10.50 each month.

Prices have been kept down since the state's rate caps expired in 2010, thanks largely to competition and the natural gas industry.

"When natural gas rates are down, the price of electricity is down," noted Irwin "Sonny" Popowsky, the state's consumer advocate.

Kurt Blumenau, a PPL spokesman, said "for the last year or so, the boom in natural gas has driven down the cost of wholesale energy." But he said "power prices usually increase in the summer on the wholesale market. It's a time of peak demand."

Even though the new price to compare, which is a combination of generation and transmission prices, is more than a penny higher per kWh than the past quarter, he said it's still lower than last summer's rate of 8.774 cents per kWh and nearly 2 1/2 cents lower than the rate in effect in the summer of 2010. Then it was 10.44 cents per kWh.

He noted that "for the past two quarters, we've had a particularly low price to compare," which makes the increase seem much more dramatic than it is.

PPL filed the rate hike with the PUC last Friday and it will remain in effect for three months, expiring Sept. 30. Jennifer Kocher, the PUC press secretary, said the commission "reviewed the request and found it to be within the guidelines established by the company's previous filings with the commission."

Popowsky said that while the quarter-to-quarter volatility could create large hikes and decreases in electricity rates, "I think we're still in very good position."

When the state let rate caps expire for PPL customers at the end of 2009, rates were raised 30 percent but they had been coming down each quarter until now.

Popowsky said the "system is working pretty well in Pennsylvania."

The new rates affect only residential and small-commercial customers on the utility's default supply service.

For small-commercial customers, the new price to compare will be 9.154 cents per kWh, compared with 6.387 cents per kWh currently, a 43 percent increase.

The increase in PPL Electric Utilities' price to compare means customers may be able to save on costs by comparing the new price to compare-with offers from alternative suppliers.

SHOP AROUND

A list of state-licensed suppliers and their offer prices are available from the PUC's website, www.PAPowerSwitch.com. More than 30 suppliers are currently serving the residential market in PPL's service area.