Pennsylvanians Must Learn About Electricity Choice to Save Money in 2023


PPL Electricity Rates June 2023 by Todd Yasbin

If you live in Pennsylvania and have not educated yourself about the energy choice laws in the state then you are missing out on a bunch of savings. Put another way, if you haven’t taken the time to shop for lower electricity rates, then you are vastly overpaying on your monthly electric bill.

While technically speaking electricity choice has been around in Pennsylvania since the early 2000s, it wasn’t until the beginning of 2010 when people throughout the state really started to take notice. It was then that a decade long low price lock in the state’s second largest electric utility expired and opened up the floodgates of new electricity suppliers entering the state market.

Pennsylvania Power & Light (PPL), the utility company that delivers power to around 1.2 million customers throughout the central part of the state, had to increase their default rate for electricity generation supply. The previous default rate had been locked in a decade prior when wholesale energy rates were very low. When the rates finally expired, wholesale rates were now much higher and caused the price their customers were paying to increase around 20% overnight.

  1. The previously low rates had two major effects on Pennsylvania electricity choice:
    For the first decade of the 21st century, competitive electricity suppliers could not offer rates to customers below the default rate and thus didn’t bother entering the market.
  2. Because rates were low customers didn’t feel the need to educate themselves about electricity choice. They may have read an article that a new law created a new energy choice market in Pennsylvania, but from their perspective nothing had changed. They still received their bill from their utility and there were no other companies marketing their service.

But that changed in 2010 when the default rates spiked. Now competitive electricity companies had a reason to enter the Pennsylvania market as they could offer customers with lower electric rates and savings on their PPL electric bills.

Electricity companies rushed into the PPL service area market with billboards, TV commercials, online advertising, and even door to door salesmen. More people started to familiarize themselves with electricity choice and the savings available by shopping for the cheapest PPL electric rates.

The following year in 2011 the same thing occurred in the state’s largest electric utility service area PECO Energy. PECO Energy, the utility that delivers power to the city of Philadelphia, had their decade long default rates expire and were forced to charge their customers a much higher rate for electricity supply.

Meanwhile, as was the case in PPL, competitive electricity companies could offer PECO Energy customers rate plans that were much lower than the default rates. Customer started comparing Philadelphia electricity prices and switching. The industry of electricity choice was starting to take shape.

Dissecting Myths about Pennsylvania Electricity Choice by Todd Yasbin


Over the next eight years customers in the other utility service area markets in the state started to see savings opportunities offered by competitive electricity suppliers. Many of the suppliers were slow to enter into the smaller First Energy areas at first, but once they could offer savings to those customers and choice awareness picked up, it make sense for them to go in and acquire a pool of new customers.

From 2010 until 2019 electricity suppliers were able to offer savings to at least some pool of Pennsylvania customers at any given time. The market was maturing as more people began to realize that they can not only shop for savings, but for price security and even renewable options.

Electricity Shopping Activity Stops

But everything seemed to change around the time of the pandemic. From early 2020 until the summer of 2023 the default rates became very low and competitive suppliers became unable to offer savings. For the last three and a half years, the growth in electricity shopping in Pennsylvania completely stopped.

Worst yet was that many customers went back onto the default rate with their utility. The number of active customers on a competitive plan began shrinking quite rapidly.

A lot can happen in 42 months. Over the last three plus years hundreds of thousands of people in Pennsylvania have moved into new homes, and without competitive electric rates offering savings to incentivize people to shop, most consumers have forgotten that Pennsylvania electricity choice exists and have reverted back to the days of regulated energy.

2023 Pennsylvania Electricity Rates are Competitive Again

In recent months the electricity suppliers have been able to start offering competitive rates that are lower than the utility default rates. At first the savings were slight, but in the summer of 2023 savings have really started to expand.

Customers of the two largest utilities - PPL and PECO Energy - are able to lower their electric bills by more than 20%. As of April of 2023 only 21.4% of PECO Energy residential customers were purchasing their power from a low Pennsylvania electricity supplier even though savings were as high as 30% off of the PECO price to compare rate.

There is absolutely no reason why a PECO Energy customer who can save 30% should remain on the price to compare rate, and yet there are more than 1.2 million residential customers who are paying that high default electric rate.


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