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Electricity Deregulation in Pennsylvania
Pennsylvania is one of many states with deregulated energy. This drives competition between retail electric providers (REPs). As a home or business owner, you have the right to shop around for the best PA electric supplier rates. You can also choose the type of contract you sign with your energy providers in Pennsylvania. You can opt for a fixed or variable rate and choose the length of the agreement.
Pennsylvania passed the Electric Choice and Competition Act in 1997. However, competition for supply became most prevalent though in 2010 across the state due to relief of rate caps. Consumers could finally shop for a new retail energy provider that was not the utility company.
You may be overpaying for your energy if you have never switched.
Utilities in Pennsylvania
In Pennsylvania, you still have an electric utility that handles all your maintenance needs. Most importantly, if your power goes out, there is an emergency, or a down power line, you will need to contact your utility for help. Your Retail Energy Provider cannot assist you with these types of situations.
There are cooperatives in the state that are unfortunately ineligible for third party supply. If you live in one you will be subject to their supply costs.
Below is a list of PA electric utilities and their contact numbers if you need to speak to them directly:
Duquesne Light Company – (412) 393-7100
Met-Ed (Metropolitan Edison) – (800) 545-7741
PECO (Philadelphia Electric Company) – (800) 494-4000
Penelec (Pennsylvania Electric Company) – (800) 545-7741
Penn Power (Pennsylvania Power Company) – (800) 720-3600
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Residential & Small Commercial Rates in Pennsylvania
If you have a home or your business uses under 250,000 kWh’s per year, it would be best to review our online portal to compare suppliers. Rates in your area are based on today’s current market conditions.
Schedule A Reverse Energy Auction
Our large commercial clients want and need a more tailored approach to their supplier shopping process. With our reverse auction, they can watch LIVE as supplier compete for their business, driving down the rate further.
Rate Options: What Are The Best Electric Rates in PA?
Understanding the different options is important before signing your next agreement. Depending on your company’s risk level, there may be other solutions outside of a traditional fixed rate.
Fixed-Rate Plan
Fixed rates are based on the market when you enroll, and they stay the same throughout your contract. If market prices are low when you sign, this type of contract can be of value to you. It is important to note that not all fixed rate are created equal. Talk to one of our experts today for more info, 800-225-3813.
Variable-Rate Plan
Variable rates change from month to month based on changes in the market and typically do not have a term attached.
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Let’s Dive Into PA Deregulation
For commercial customers in Pennsylvania, the way you use your energy is crucial to getting the best rate option for your business. Regardless of your annual kwh usage, there are other factors that are weighed in. These factors determine the risk for a supplier to purchase your energy. Your utility assigns you “tags” for both capacity and transmission.
Capacity
Maximum Generation Capacity is the amount of power your business would use if running at full blast. Your highest consumption on a ‘peak day’ in both the summer and winter are used to analyze your usage pattern. It is crucial to ensure the electric grid can provide you your energy. Based on how you much extra power you are consuming on those days will determine your capacity costs.
Transmission
Transmission rates are called Network Integration Transmission Service or NITS in PJM. NITS rates are demand-based charges based on your network service peak load value and are calculated using this formula: (NSPL x Transmission Rate $/MW-day x # of Days in term)/Forecast Term Volume.
Most supplier options have clauses that adjust for changes in their network service peak load value and current transmission rates set by the PJM. If your companies peak load were to change, your agreement may account for pass-throughs either up or down to adjust for those changes. There are solutions that lock in your capacity and transmission costs regardless of your peak load adjusting throughout the contract. To best understand what is included and not included in your new energy agreement, have one of our Energy Advisors review the options alongside you.
Gross Receipt Tax (GRT)
As a consumer in the state of PA you are subject to a tax no matter who you receive your electricity from. Gross Receipt Tax (GRT) is included in the costs of electricity generation. Regardless of the supplier (or the utility if you are on the Price to Compare rate) you use.
The current GRT rate in Pennsylvania is 5.90 percent. However, distribution companies and PA electric suppliers include a ‘gross-up’ factor. As a result, the amount is actually 6.27 percent on the base price of electric supply. The ‘gross-up’ factor is calculated by using the following formula: 1/1-5.90 percent.
It is crucial to understand that while GRT is 5.90 percent, the total cost that is passed on the consumer will total 6.27 percent. When shopping for an electric supplier in PA, we advise that you review rates with and without GRT. This way you can easily compare apples to apples.
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