For Immediate Release
June 22, 2007

CONTACT:
Colleen Greer
Phone: 717-787-6801
Back to News Releases

Weekly Column: PUC Investigating Distribution Rate Increase Request for PPL Customers

Under a state law approved in 1996, Pennsylvania adopted its own electric deregulation plan allowing customers to choose their electric suppliers. As part of the deal with electric companies, PPL and Met-Ed among them, rates were capped for a period of time. But now the artificial caps that stabilized prices are about to expire.

Earlier this year, PPL Electric Utilities filed a proposal with the Pennsylvania Public Utility Commission (PUC) to increase its distribution rates for consumers. The company is making the request to ensure that it has the resources needed to continue to provide highly reliable electric service to customers. The rates would cover expenses related to personnel, poles, wires, and electricity delivering equipment. PPL is also proposing new programs to help customers manage their energy use and encourage energy efficiency.

In addition, a new electric consumption tax has been unveiled by Governor Rendell to promote his energy independence plan, which if enacted, would be an additional tax on consumers. The Legislature continues to study and debate the merits of this plan.

The proposed increase by PPL is expected to affect approximately 1.2 million residential customers and about 174,000 commercial, industrial, and municipal customers in Berks, Bucks, Carbon, Chester, Clinton, Columbia, Cumberland, Dauphin, Juniata, Lackawanna, Lancaster, Lebanon, Lehigh, and Luzerne Counties. Based on the request, PPL's average residential customer would pay about $6 more per month. The company claims that even with the proposed increases, rates would remain below average in Pennsylvania, the Northeast, and Mid-Atlantic. However, the PUC will investigate PPL's request to increase its distribution rates.

Changes to distribution rates must be reviewed and approved by the PUC. The utility must file a request with the PUC that shows the proposed new rates and effective date, and must prove that the increase is needed. The utility must also notify customers at least 60 days in advance. This notice must include the amount of the proposed rate increase, the proposed effective date, and how much more the ratepayer can expect to pay.

By operation of law, the proposed increase will be suspended for up to seven months from its proposed effective date. The commission voted to open an investigation and assign it to a PUC administrative law judge for a recommended decision or settlement. During the investigation, hearings are typically held to hear evidence in support/against of the rate increase and expert witnesses are called to testify. In addition, consumers are given an opportunity to voice their opinions and share testimony.

The PUC has scheduled a series of hearings to receive comment on the proposed distribution rate increases by PPL. The next local meeting will take place on Wednesday, June 27, 2007 at 7 p.m. at the PUC's headquarters located in the Commonwealth's Keystone Building on 400 North Street (hearing room #2). Consumers are asked to arrive 10-15 minutes before the hearings begin. Those who want to testify will need to sign in. Residents should also bring documents of any information they want to provide as evidence. Once the hearings are complete, the PUC Commissioners will make a final decision by January 1, 2008.

For more information on the schedule of hearings, consumers may visit the PUC's website at www.puc.state.pa.us or call PUC's Bureau of Consumer Services at 1-800-782-1110. Customers may also contact the PUC with their views on the rate increase by writing letters to: The Pennsylvania Public Utility Commission; Bureau of Consumer Services; P.O. Box 3265; Harrisburg, PA 17105.

Comments, questions, or complaints concerning public utility issues can also be share with the Office of Consumer Advocate (OCA). Pennsylvania's consumer advocate can be reached by calling 783-5048, by email at consumer@paoca.org, or on the Internet at www.oca.state.pa.us.