Pennsylvania Senate Passed Energy Legislation to Help Lower Consumers Costs

Recently, the Senate passed energy legislation that would help lower consumer electric costs.  With the wallets of Pennsylvania citizens taking a beating, due to the economic downturn, it was important that we relieved some of the financial burden from their shoulders.  This legislation does just that.

Recently, the Senate passed energy legislation that would help lower consumer electric costs.  With the wallets of Pennsylvania citizens taking a beating, due to the economic downturn, it was important that we relieved some of the financial burden from their shoulders.  The measure was recently signed into law by Gov. Rendell.

That means that the state’s 5 million-plus electricity customers would see more than $500 million a year in savings starting in 2013.

This new law is the first step toward fighting full deregulation that will begin in 2011. It is important that we recognize that there is more work to be done to make sure ratepayers are not shell-shocked by higher rates that could increase by 40 to 70 percent under full deregulation.

This complete deregulation could easily mean hundreds of dollars annually in higher bills for each household and small business.  It would also add approximately 20 percent to PECO’s revenue, as well, at the cost of ratepayers.

We still need to find a way to ensure that this electric bill increase does not hit ratepayers all at once and the only way to accomplish that is to mitigate or phase in higher electric rates before the rate caps come off in the next two years.  Utility shutoffs have been steadily rising over the past year and if the energy deregulation issue isn’t taken care of, it could mean many more people unable to keep up with their energy bills and more shutoffs.

After 11 years, the rate cap on the generation charge portion on a consumer’s bill will end in 2010.  While the rate cap has been in place, the costs to generate electricity have risen steadily.  There will be a need to recoup this charge from consumers.

I am confident that we will find a resolution to this problem and I look forward to working on this issue with my colleagues when the Senate reconvenes.

The law would also impose fines up to $20 million against utilities caught manipulating the price of electricity. Utilities would also have to show state regulators that they are seeking out the lowest-cost electricity to deliver to ratepayers.

It is important that utilities recognize the seriousness of this issue and find ways to better help consumers save money through conservation.

In addition, many more customers would receive “smart” power meters that track how much electricity flows into a home, allowing utilities to better respond to outages and offer alternatives to the average monthly rate that they traditionally charge.  Utilities would have to provide a smart meter to whomever requests one, install one in all new construction and swap one for any meter that is at least 15 years old.

These measures are great ways to save ratepayers more money through conservation, an important part of the governor’s energy independence efforts.