Unlike shopping for Natural Gas, where choice is more limited, customers shouldn’t automatically pitch those offers they get in the mail from electricity suppliers, because there are multiple suppliers for each of Pennsylvania’s electric utility providers and most offer savings that can be significant.
Here in Allegheny County, residents get their electricity from one of three distributors, Duquesne Light, West Penn Power and Pennsylvania Power.
The largest, Duquesne Light, providing service to about 95 percent of the county’s residential customers, also has the largest number of licensed competitors, 14. All these competitors offer rates below Duquesne’s current price to compare of 9.32 cent per Kilowatt Hour (kWh).
Direct Energy, for instance, currently offers a 15 percent discount on Duquesne’s rate, or 7.92 cent, for one year. Dominion Energy Solutions is offering a 25 percent discount, 6.99 cent, through May 2013.
Until March 30, First Energy Solutions is offering Duquesne customers a fixed rate of 7.15 cent through March 2014. That means someone using 2000 kWhs per month would save $28 on their bill.
That same supplier, however, offers West Penn Power customers a rate of 6.65 cent, but West Penn’s price is 7.19 cent more than 2 cent lower than Duquesne’s price.
Sonny Popowsky, head of the PA Office of Consumer Advocate, said the difference is due to how the Pennsylvania Public Utility Commission sets rates for electrical distributors.
“The PUC approves Duquesne’s rates in three-year increments. So their current rate was set in 2010 and wholesale prices have dropped since then,” he said. “West Penn’s and Penn Power’s rates are based on current prices and adjusted every three months. That means the biggest bargains are found in Duquesne’s territory.”
Because of that, Penn Power customers are, for now, out of luck because none of its three competitors can match its current 6.20 cent per kWh rate.
There are also more choices available in the electricity market compared to natural gas because there are a variety of ways to generate electricity.
“Gas is gas, but with electricity you can buy different products,” he said. “If you want ‘green’ energy you can get it.”
Actually, since Pennsylvania passed the Alternative Energy Portfolio Standards Act in 2004, everyone pays for “green” electricity whether they want to or not. The state mandates that all distributors buy a percentage of electricity generated from sources such as wind, solar, geothermal and hydroelectric.
But for customers who want to be really environmentally active, suppliers offer “green” energy packages in amounts ranging from 2 percent to 100 percent. Duquesne competitor Ambit Energy offers a 100 percent renewable one-year fixed rate of 9.54 cents. Viridian Energy offers 100 percent renewable electricity for at a fixed one-year rate of 10.5 cent per kilowatt-hour.
Several of these suppliers charge termination fees for early withdrawal. Some fees are fixed, others are based on the remaining time on the contract.
Popowsky’s office has a shopping guide that lists distributor and supplier prices at http://www.oca.state.pa.us.
“The PUC has a more interactive guide, PA Powerswitch, that allows you to plug in your own billing numbers and get prices form competing suppliers,” he said. “But the bottom line is people are shopping, according to the PUC more than 1.6 million people have done it.”
The PUC guide can be found at http://www.papowerswitch.com.
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