Rising energy prices are prompting consumers across Pennsylvania to reconsider their monopoly utility’s default service and look for better options based on the lowest price and customer service. The Pacific Research Institute and the Energy and Policy Institute recently documented several incidences of consumers being subjected to skyrocketing electricity bills due to mistakes (or worse) by monopoly utilities.
The Retail Energy Supply Association (RESA) said that the rates that non-shopping customers in Pennsylvania pay utilities for electricity have skyrocketed, with prices more than doubling or tripling in some cases since December 2020, with the increases ranging anywhere from 57.25 percent to 341.91 percent, depending on the utility.
One utility customer said his household electric bill increased from roughly $120 to $270 in the last two months, which is why he decided to switch to Dynegy, a retail electric supply company, which was charging a third of what the local utility was billing.
PPL Electric Utilities, a monopoly utility serving eastern and central Pennsylvania, recently sent estimated bills to their default service customers because a “technical system issue” that prevented them from accessing usage data. Many consumers experienced sticker shock when they received bills based on “estimated electricity usage” that were hundreds of dollars more than expected.
PPL Electric Utilities’ Price to Compare increased by nearly 18 percent at the beginning of December and has nearly doubled over the past two years. Many customers are paying significantly more than they need to for electricity. PPL hit customers with an 18 percent rate increase on Dec. 1, but some people received bills that were 50 percent higher than expected. The Pennsylvania Office of Consumer Advocate said more than 795,000 customers were affected by the billing issue.
After apologizing for the billing snafus and slow response rates to customer calls, PPL recommended customers use the PUC’s PAPowerSwitch tool to shop for a provider that might offer a lower rate than PPL’s default rate.
According to analyses by the Pacific Research Institute, a Pennsylvania Public Utility Commission investigation found that PPL mailed out 12,000 bills incorrectly last year, even to those who were being billed online.
Duquesne Light Holdings, a monopoly utility in Pittsburgh, last year sent a mailing to more than 3,000 customers with incorrect names and account numbers. The PUC imposed a $12,500 fine in December.
PECO, which serves 1.6 million customers in Philadelphia, was fined $225,000 in December by the PUC for improperly terminating 48,500 customers in 2018 and 2019. The Exelon subsidiary violated provisions of the state’s utility code requiring it to have direct contact with customers at least three days before a scheduled service shutoff due to non-payment.
Sloppy billing practices are one thing, but the monopoly utilities’ abuse of their consumers often goes far beyond “technical issues.”
A Pennsylvania Public Utilities Commission audit released last year revealed that FirstEnergy charged Pennsylvania customers $2.4 million in “inappropriate costs” related to an ongoing federal criminal investigation in Ohio, but the audit did not identify what FirstEnergy used the money for. The Energy and Policy Institute obtained records showing FirstEnergy used the money for payments to firms associated with two individuals involved in the utility company’s corruption scandal in Ohio, Samuel Randazzo and Tony George.
FirstEnergy uncovered the charges during an internal investigation launched in 2020, after the company was subpoenaed in a federal criminal investigation in Ohio involving tens of millions of dollars in bribe payments. Randazzo resigned in 2020, after the FBI raided his home and FirstEnergy first disclosed a secret $4.3 million payment that the company admitted influenced Randazzo’s official actions as chairman.
Earlier research and analysis by EPI found Pennsylvania customers may be on the hook for “external affairs” spending by FirstEnergy that exceeds the $2.4 million in refunds proposed by the company. More on the FirstEnergy corruption saga can be found on EPI’s website.
Pennsylvania consumers have been able to choose their electric service provider for the last 25 years. The next rate adjustment in Pennsylvania is set for March. Customers in the state can shop for electric rates from various suppliers on the PA Power Switch website.