Summer Electricity Rates May Be Uncertain
Last summer, PJM capacity auction prices shot up over seven times their normal prices. As a result, PA electric choice prices could rise this summer. A lawsuit between PJM and PA Governor Josh Shapiro attempted to address these rising costs. But, while the complaint was settled, we’re still on the hook for a rate hike from those crazy auction results. And to top it off, the electricity market is in a tizzy over the recently proposed tariffs.
This summer’s electricity prices could skyrocket. Thankfully for PA consumers looking for cheap electricity, you still have time to shop and save.
PJM and Electricity Auction Rate Hikes
Prices spiked during this last auction for several reasons. But the main issue is how slow PJM has been to add new power plants to the grid. Power plants are retiring faster than new ones are cleared to take their place. In April 2024, some 3,009 power projects sat waiting in the PJM connection queue. At one point, new projects faced a delay of 4 years.
As a result of this grid mismanagement, and the last auction, electric bills for the 65 million people served by PJM will go up this June to cover that cost.
Utility Auction Rate Hikes, Price Uncertainty
While final rate hikes haven’t been announced, we have some good estimates. PECO expects a 10% increase in monthly bills in 2025 due to the capacity auctions. Meanwhile, PPL says monthly customer bills will go up by $10 to $15. Estimates put the new price to compare at about 12.65¢/kWh. And finally, First Energy companies will raise customer bills between 11% to 19%.
However, there’s another factor to consider. The Trump administration’s proposed tariffs could upend US electricity prices. So right now, we can’t guess how rates may change this summer.
Lock in a Low Rate this Spring
But, there’s ways to handle price uncertainty. For instance, you could purchase a short term electricity plan, and keep an eye on the market. But, if this is too much effort, you could purchase a longer term plan. This would let you avoid price uncertainty and keep your bills steady.
So, with that in mind, let’s review a few plan options. To start, we’ll assume an average energy use of 1000 kWh per month.
Firstly, for PECO customers, we have the APG&E True Simple 3 plan. This short term plan comes in at 9.55 cents per kWh or around $95.50 a month on energy supply. If you want something with a longer term length, consider the Direct Energy Live Brighter 7. This 7 month fixed rate of 9.79 cents per kWh should cost around $98 a month in energy supply. In addition, both of these plans come with no monthly charges or early cancellation fees.
PPL customers can also check out the APG&E True Simple 3 plan. Slightly higher in this service area at 11.52 cents per kWh, it’s around $115 a month in energy supply costs. If you want a longer term length, check out Major Energy. Their Secure Choice 6 offers new customers a 6 month fixed rate of 11.99 cents per kWh. Which should cost around $120 a month in energy supply. Additionally, both plans also come with no monthly charges or early cancellation fees.
Find the Best Rate Today
Don’t let rising PA utility PTC rates keep you frozen in place paying high electric bills. And don’t panic about an uncertain energy market. Find the best plan for your home with us. Visit https://www.paenergyratings.com to explore the various electric plans in your area.