PUC approves PECO's electricity, natural gas rate hikes for 2025, 2026

If you haven't gotten a utility bill in the New Year, you may want to prepare yourself.

According to a press release, the Pennsylvania Public Utility Commission (PUC) has approved rate changes by PECO for both electric and natural gas distribution services.

Officials voted to lower PECO’s proposed increase in its monthly distribution customer charge, which will now be by $0.75 per month instead of an increase of $3.78.

Under these settlement rates, the monthly bill for a residential customer using 700 kilowatt hours per month will increase by $13.58. The average monthly bill hike from $135.85 to 149.43 represents a 10% change. In 2026, the bill for this customer will increase by an additional $2.70 per month, from $149.43 to $152.13 (1.8%), including default service generation, taxes, and other surcharges.

The company initially proposed an increase of $16.67 (12.8%) and an additional $2.70 in 2026, but settled on the lesser terms for 2025. Under the terms of the settlement, PECO agreed not to file for another rate increase prior to March 16, 2026.

The settlement also reduced the company’s proposal for a 36% increase in its residential gas distribution customer charge. Customers will see a 10.2% increase from $14.25 to $15.70. The monthly bill for a residential customer using 80 Ccf per month will increase by $12.25, from $97.98 to $110.23 (12.5%). In PECO’s proposed filing, the bill for this customer would have increased by an additional 4% ($114.13 per month).

Additionally, the commission rejected PECO’s request to implement a Weather Normalization Adjustment (WNA), which was the only contested issue.

Putting funds to work

The settlement strengthens PECO’s customer assistance program (CAP) by:

• Participating in the Pennsylvania Department of Human Services’ data sharing program, consistent with the Commission’s order of June 13, 2024.
• Convene a stakeholder collaborative with its Universal Services Advisory Committee and interested parties to this case to discuss how PECO could implement automatic enrollment of non-CAP LIHEAP recipients in CAP.
• No later than April 1, 2025, add PECO’s health usage rider exemption language to the maximum CAP credit letters.
• Starting in 2025, include an additional $1 million in the Electric Low-Income Usage Reduction Program (LIURP).
• File a compliance filing in its Universal Services and Energy Conservation Plan – including financial, application and website enhancements for the company’s Matching Energy Assistance Fund.
• Enhance its customer service and consumer protection processes, including a more comprehensive evaluation of call center performance, a company review of low-income customer security deposits, termination notices and service disconnections, as well as an extension of speech analytics software involving universal service programs and other low-income customer issues.
  
  

For its gas division, PECO will: 

• Commits to improving the consistency and accuracy of leak reporting from the field with more training and awareness of field personnel and performing quality audits.
• Building a new dashboard and implementing Synergie software to better present and analyze risk, including cathodic protection status and population density into its risk model.
• Continue identifying and locating inaccurate facilities.
• Starting in 2025, adding $500,000 in the Gas LIURP.
• Increasing the budget for natural gas Energy Efficiency and Conservation by $350,000 per year.
• Revising and strengthening its Neighborhood Gas Pilot, Small Business Grant Program and Gas Customer Safety Program.