Dependence Day: More Pennsylvania Residents Backsliding to Safety Net Default Service, Not Exercising Freedom to Shop (State Aggregate Shopping Falls, Again)

The "cliff" threatening the Pennsylvania retail electric market that several of the Public Utility Commissioners have expressed concern about -- the lack of headroom in a year or two, towards the end of the current default service plans as rates become increasingly divorced from market pricing -- it might be here sooner than expected.

Because for only the second time since weekly migration stats started being published two years ago, the state saw a decline in total migration to competitive electric supply, as well as a decline in residential shopping. Three individual utilities saw residential shopping decline as well in the most recent stats, from about June 27 to July 3 (reporting date varies slightly by utility).

Pennsylvania's growth in electric migration has been anemic for most of 2013, and the state already recorded the dubious distinction of seeing a decline in residential shopping back in May, where during one week the state saw aggregate residential shopping fall by about 230 accounts. However, it could at least be argued that the May data reflected the tail-end of default service plans that were at the end of their two or three-year span, and therefore, rates were as far away from market reflective as they could get.

June 1, however, brought relatively fresh default service rates (admittedly with supply procured several months before delivery), but the anemic aggregate shopping growth has continued (with several utilities seeing declining residential shopping).

The start of July has now seen the state return to an overall decline in residential shopping, as three utilities experiencing a decrease in residential migration are outpacing the anemic growth in the remaining territories. Specifically, residential shopping fell by 293 accounts from about June 27 to July 3, versus the week-ago growth of 1,600 accounts. PECO, PPL, and Duquesne Light saw a loss of residential shoppers in the most recent week.

This aggregate residential decline more than offset the growth in shopping among C&I customers, resulting in total migration falling by about 100 accounts. Note that the most recent stats are as of July 3, and do not reflect any meter reading holiday which otherwise would delay switches (which will show up next week).

Specifically, from about June 27 to July 3 (report date varies slightly by utility), the weekly growth (loss) in residential electric customers on competitive supply at each EDC was:

Duquesne Light         (639)
Met-Ed                  728
PECO                   (929)
Penelec                 376
Penn Power               40
PPL                    (135)
West Penn Power         266

Link to 7/3 Weekly Migration Report

Link to Matters' comparison of 6/26 stats and 7/3 stats