More than ever, Pennsylvanians are looking for ways to save money and cut costs during these tough economic times. Even as the commonwealth reopens and slowly emerges from the lingering effects of the COVID-19 pandemic, we still don’t know what the coming months may bring.
However, what’s certain for many is that shelter-in-place orders have made us more acutely aware of our energy use. With computers running, phones charging and air conditioners humming all day long in the summer heat, people working from home now are seeing higher bills.
We’ve seen our day-to-day electricity use change dramatically. But even in a lockdown, mandated or not, consumers have choices that potentially can save them money right now. And they’ve had the power to choose for some time.
In 1996, Pennsylvanians were given by law the option of choosing their electricity suppliers. Prior to competition, our commonwealth had some of the highest electricity prices in the country.
Since then, average prices have lowered and stabilized, and Pennsylvania’s program has been hailed as a national model. Notwithstanding this fact, less than 30 percent of residential consumers participate in Pennsylvania’s electric choice program.
Residents need to know what a majority of businesses have already learned.
Driven to lower their energy costs and take advantage of innovations that competition brings, more than 60 percent of commercial and industrial consumers participate in the competitive power market.
Potentially saving hundreds of dollars annually can make a big difference for families on the edge. The same goes for businesses still trying to recover from this crisis. But getting back to normal doesn’t mean going back to business as usual.
Reminding everyone about their choices and the programs available on how they might save money can play a major role in getting our economy back on track. So can making sure the policies are in place to emerge stronger than before.
As successful as Pennsylvania’s electric choice program has been, it needs updating to keep up with consumer demands, technology and market trends.
Here’s why.
Right now, consumers who don’t choose their electricity supplier — again roughly three-fourths of all residential customers — automatically default to their utility company. When they do, these regulated monopolies have little incentive to invest in innovation, efficiency or customer service. Plus, they lean on ratepayers to recoup production losses.
To compete with these utilities, electricity suppliers must innovate, enhance efficiency, offer creative renewable energy plans and manage risk on behalf of consumers while bearing any cost increases — unlike utilities that pass on those costs to customers.
The good news is new legislation (H.B. 2555) would bring Pennsylvania’s competitive power program into the 21st century. If made law, H.B. 2555 would switch things around with Supplier Consolidated Billing, where the customer pays the electricity supplier directly, making the supplier responsible for paying the utility for billed costs.
This would make the suppliers directly accountable to the consumers.
Think about it this way: When you order a product from Amazon, you don’t get billed by FedEx or UPS. You get a bill from Amazon with the shipping charges included. Your electric bill should be no different when you order a product from an electricity supplier.
When there’s a direct relationship, electricity suppliers seek to understand what consumers want and use innovation as a way to win and retain customers through enhanced services and energy management tools like time-of-use pricing to curb usage during periods of intense demand. Suppliers can provide data on how electricity is consumed to alert customers, so they can use less.
Imagine having that much control during uncertain times!
Importantly, if you choose a competitive supplier, your reliability will remain exactly the same, because your power is delivered to your home in exactly the manner as it is today — and by law, your current utility must respond to outages with the same priority, even if you choose a competitive supplier.
Pennsylvania families and businesses have the power to choose.
With updates to the state’s electric choice program and armed with new information about their own energy use during this pandemic, consumers will have even more power to take control of their energy costs and partner with the right supplier with the right solutions to meet their needs.
