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Retail Supplier Residential Rate At 3 Pennsylvania Utilities (Including PECO, DLC) Lower Than 1996 Monopoly Supply Rates Even Without Adjusting For Inflation
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The average lowest fixed price retail electric supplier residential offer in Pennsylvania during 2024 was cheaper than the 1996 monopoly utility supply rates at three Pennsylvania utilities without even accounting for inflation, while such supplier rate was cheaper than the 1996 monopoly supply rates at all seven of the large EDCs when adjusting for inflation, according to a new analysis from John Hanger, who was a commissioner at the Pennsylvania Public Utility Commission (PUC) in the 1990s
Specifically, using the lowest monthly retail supplier residential fixed-rate in the relevant service area in 2024, the retail supplier rate was below the 1996 utility supply rate at PECO, Duquesne Light, and Penn Power, without even accounting for inflation
Under the analysis, the 2024 retail supplier rate was derived from PAPowerSwitch, reflecting the average annual lowest fixed-rate supply charges available within each utility service territory
When accounting for inflation, such retail supplier rate was below the 1996 utility supply rate at all of the seven large EDCs in Pennsylvania
All cost data, except the per kWh chart below, reflects a monthly supply bill for 500 kWh usage for a residential customer
"The 2024 retail supply charges for residential customers compared to the 1996 utility monopoly supply charges and the inflation-adjusted equivalents demonstrate that retail customers, who shopped for the lowest monthly fixed-rate in 2024, were paying on average 26-67% less or $10-$56 less for electricity supply in 2024 than in 1996 when the inflation adjustment is applied for supply charges. The savings for retail customers were so great that in three of the seven major utility service territories, residential retail customers paid less than they would have actually paid in 1996. The electricity price for these customers has decreased since 1996, if they shop for the lowest retail supply rate," the report said
The report also compared 2024 default service rates versus the average lowest fixed retail supplier rate
"Across all service territories, residential customers have fixed-rate retail supplier options below the utility default rate," the report states
"If utility customers had enrolled in the lowest fixed-rate offer available in their service territory, they would have saved between 30-39% or $14-$20 per month compared to the utility rate," the report said
"In 2024, across all service territories, residential customers that enrolled in the lowest fixed-rate product experienced savings averaging 34% of their energy supply bill when compared to the utility supply charge," the report states
A summary comparison of monthly costs under the 1996 rates, the 1996 inflation-adjusted rates, the 2024 default service rates, and the 2024 retail supplier average lowest fixed rate, is below:
Data on a cents per kWh basis was also included:
"As utilities in monopoly states grapple with the retirement of aging generation and push for legislation to allow them to handcuff ratepayers to new generation investments, lawmakers in other states find themselves in a similar situation to Pennsylvania in 1996 and should look to competition as a short and long-term solution for resource adequacy, reliability, and keeping costs down," the analysis states
"It's clear that competition in an energy market is working," said Hanger. "The monopoly utility structure made energy less affordable and customers still had roaming blackouts in the early 1990s. By introducing competition to the market, power generation has increased and customers are able to hold utility companies accountable because they can shop for their electricity supplier."
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Retail Supplier Rate Lower Than 1996 Utility Rates On Inflation-Adjusted Basis At All 7 Large EDCs
June 4, 2025
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Copyright 2025 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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