PPL Rate Increase for Summer 2013 Goes Into Effect

On June 1, 2013 Pennsylvania Power & Light customers who have remained on the electric default rate got a significant rate increase that will show up when these consumers receive their electric bills in July. The PP&L price to compare rate jumped from 7.4 cents to 8.227 cents as calendar pages turned from May to June. PP&L electric rates have been very volatile since the start of Pennsylvania electricity choice. At times competitive rates have showed savings as high as 25% versus the PPL price to compare, while in recent months few competitive suppliers were able to offer savings versus the default price.

The PP&L price to compare is the default rate consumers pay for generation and transmission charges who do not shop for competitive power. The price changes every three months and is often very difficult to predict. Even when PP&L does post an estimated price to compare for the next three month period it has proved to not be an accurate forecast. The majority of PPL customers who have done an electricity switch and who are buying their power from an alternative supplier do so because of the savings they get at that specific time period. However, for more customers the benefits of electricity choice is becoming just as much about price security and certainty as the instant savings. Consumers who locked in fixed electric rates last fall to save money during that time may have been slightly disappointed when PPL announced a default rate reduction from March through May of this year. However now they are saving money once again when electric bills will be at a premium in the hot summer months. These customers do not have to be concerned with this PPL rate hike or the potential of another one in three months since they locked in a low fixed electricity rate.

As of May 29, 2013 over 527,000 residential PP&L electricity customers are purchasing their power from competitive energy companies. This number actually decreased slightly from the all time high achieved in March of 2013 due to the low PPL default rates over the last several months. With the recent rate hike in effect that number is expected to grow. With 42.8% of the residential class active in electricity shopping the idea of electric choice in Pennsylvania is no longer a foreign idea. The market has become once of the most competitive energy choice markets in the country with new suppliers entering almost every month offering low electricity prices and sometimes additional incentives.

Current competitive PP&L electricity prices can be found below.


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Compare PPL Electric Rates

A variety of electric rate products exist for PPL customers.  Many Pennsylvania electric consumers have chosen a variable electric rate since capped rates expired at the beginning of the year.  Most of these customers saw a sharp increase on their rates and electric bills last month.  The rise in electric prices was a direct result of spiking wholesale electricity prices.

Those customers who have chosen a fixed electric rate did not see such spikes last month.  Variable electric rate customers, both residential and commercial, may want to look into the security of a fixed electric rate as we approach the peak of hurricane season, which can have a negative effect on wholesale electricity prices.

PPL customers who have not switched electric companies for their supply service should shop in order to compare their options.  Pennsylvania Power and Light is still responsible for the delivery of power and the maintenance of the lines and wires.  However with default electric rates above 10 cents per kilowatt hour, it makes sense for all electric customers to compare electric rates in order to find savings.  Lower electric rates are yielding saving between 10 and 30 percent off of electricity bills for consumers and businesses.
Compare PPL Electric Rates:


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Kilowatt Hour Cost Increases for Large Commercial PPL Customers

Large commercial and industrial electricity customers in PPL who are on a variable rate will see an increase on their electric bills in August due to an increase in their kilowatt hour cost.  Many PPL (Pennsylvania Power and Light) commercial customers who are on default service and are under the PPL rate class of MP, MT, or L5 have their rate directly tied into the wholesale energy market.

From January until June 2010 these default customers have enjoyed low default rates as the wholesale prices have averaged between $0.06 and $0.08 cents per kilowatt hour over the period.  However, in July these rates got out of hand and were as much as $0.30 cents per kilowatt during some hours.  Many of these MP and MT rate class customers can expect their kilowatt hour cost to be above $0.10 when their August bill arrives.

These large commercial and industrial energy users did not have an incentive to shop the competitive market for low electric rates because the floating rate that they were receiving were so low.  Now that these variable rates have increased, many of these commercial electricity customers will shop the market for low fixed electric rates from an electricity company offering competitive supply rates.  Large commercial electricity customers can find fixed rates as low as $0.073 per kilowatt hour, which can help these customers budget against volatile energy prices.

Current wholesale prices for electricity for PPL can be found at www.pjm.com

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PPL Electric Providers

The purpose of this article is to briefly explain the different type of electric providers in the Pennsylvania PPL electric market.

With the competitive electric market in the PPL utility territory maturing, business and residential customers are starting to become more familiar with some of the 30+ alternative suppliers’ brand names.

With many consumers the idea of electricity choice is still a foreign concept, and difference between providers is minute.  In reality the difference between some electric providers can be vast.  To start, though all electric providers are selling the same end product, electricity, how and who they sell it to will determine if they can be a right fit for you.

I put the providers into three categories:  Level 1 (Bait and Switch), Level 2 (Fixed Rate), Level 3 (Large Business Complex).

Level 1 providers are providers like Viridian and Glacial Energy.  They present an easy and friendly way to switch showing an introductory rate that is less than current default rates.  There rate is a floating rate that can changed at anytime.  Their market is usually small businesses who spend less than $1,000 a month.  They attract a customer who is unwilling to sign a more complex contract that would allow them to lock into a low fixed rate.

Level 2 providers offer customers a true fixed rate that will not fluctuate during the term of the contract.  Their contracts are more complex than that of the Level 1 provider because they are essentially buying the power for the specific customer on the wholesale market in advance.  This is how they are able to offer a fixed rate.  Providers like this include Liberty Power, Con Ed Solutions, and Direct Energy.  Their target markets are businesses that have good credit ratings.

Level 3 providers are usually only willing to service large business customers.  They tailor their rate products and contracts for those customers.  Their contracts are usually the most complex and often the customer will benefit by having a licensed broker represent them in negotiating the contract with the provider on their behalf.  The complexity of the contract is however justified as the provider is making a large investment, by agreeing to buy a large block of energy, for the customer and in doing so can save the customer a lot of money on their energy expenses.  Though not always limited to these type of transactions, some of the providers that are more likely to fall into this class are Suez Energy, UGI Energy Services, and Constellation New Energy.

For more information on specific providers, feel free to leave a comment or send and email.

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Lower My PECO Bill

PECO is trying to prepare their customers for choice in who charges them their electric rates by unleashing multiple programs.  Recently, the PA Public Utilities Commission announced that Pennsylvania utility companies will offer customers a choice of who they buy their electricity from.  In addition, price caps that expired in 2011 in the PECO area - as well as Met-Ed, Penn Electric, and West Penn – have increased default rates and given consumers an incentive to shop.

PECO is rolling out numerous programs to help customers cope with increases including the PECO Smart Home E-Audit, Smart Lighting Discounts, Smart Home Rebates, and Smart Appliance Recycling.  Alot of smart programs, but probably the smartest way consumers will be able to reduce their electricity bill is by shopping for an alternative supplier that will offer a reduced rate versus the PECO price to compare default rates.

PECO will continue to deliver power to those customers who they are currently delivering to as well as continue to send invoices out.    The decision to choose an alternative electric generation company will simply be a choice to pay less.  We will be providing contact information and rates for alternative providers as we get closer to 2011.

Update, as promised above, here are the absolute best rates and electric providers we have found in PECO:
Rates are updated Daily


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