PPL Electric Utilities has completed its sixth and final electricity purchase for 2010. This is expected to help fulfill the company's requirement for purchasing electricity in the wholesale market for its customers.
As a result of blending prices in contracts from all six solicitations, the bill for an average residential customer who chooses not to shop will increase about 29.7% next year following more than a decade of capped generation supply rates, the company said.
In the latest round, PPL Electric Utilities also purchased a portion of the electricity supply for 2010 for large commercial and industrial customers who do not shop for competitive suppliers.
The results of the solicitation were approved by the Pennsylvania Public Utility Commission (PUC). The purchases completed a process begun by PPL Electric Utilities in 2007 to buy the power needed to serve customers in 2010.
A total of 25 different suppliers have competed in the procurement process since 2007, including 17 who participated in the sixth round. A total of 11 different companies have won supply contracts over the six solicitations.
David DeCampli, president of PPL Electric Utilities, said: “To help our customers prepare, we’ve shared information for more than three years about how electricity prices will change when rate caps expire. Now we have a clear picture of what customers can expect, and we offer a wide range of programs and options to help customers manage their bills and use energy wisely.”
The company said monthly bills will increase on average about 18.4% for small businesses and about 36.1% for mid-size businesses.
For large commercial and industrial customers, a fixed generation price of 9.2 cents per kilowatt-hour will be offered to customers on the company’s LP-4 rate schedule and 8.95 cents per kilowatt-hour for LP-5 and LP-6 customers. This offer applies to customers who expressed an interest in a fixed-price option earlier this year.
These customers will have until November 9 to decide whether to accept the fixed-price option from PPL Electric Utilities, choose an alternative supplier or allow PPL Electric Utilities to purchase electricity for them on an hourly basis in the competitive wholesale market.
PPL Electric Utilities will know the exact 2010 rates for its customers in December when several smaller components of the bill are adjusted and approved by the PUC. These adjustments generally have a minimal effect on customer bills, the company said.
Mr DeCampli said: “Adjusting to higher generation supply prices, we are obligated to pass through in 2010 will be difficult for some of our customers. We’ve tried to prepare customers by raising awareness, promoting energy efficiency, and giving customers options that can help them adjust gradually to the change. We remain committed to helping them through this transition.”
He said that the company expects to begin offering many new energy efficiency programs beginning later this year. The programs, under review by the PUC, would provide financial incentives to customers who make their homes and businesses energy-efficient.