Surging electricity bills draw backlash

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HARRISBURG -- Complaints about recent spikes in electricity prices for variable-rate customers, a subject of increasing attention in the capital, dominated a Senate hearing Thursday with public utility regulators.

State senators repeatedly questioned the Public Utility Commission about the unusually high bills received by constituents in the past weeks. Complaints to the commission this year have far outpaced those for the same period in 2013. The PUC received 1,468 complaints about high bills from suppliers from Jan. 1 to Feb. 21. In the same period last year, it received 345 complaints, ending 2013 with 2,122 total.

"What has happened in the last three, four weeks to folks all around the state with variable rate is shocking," said Sen. John Gordner, R-Columbia, who said he supports competition for electricity consumers. "When you have folks who have seen their rates triple, it is unacceptable."

Sen. Lisa Boscola, D-Northampton, said she has spent hours on the phone with people whose electricity bills have skyrocketed.

"What are we going to do, moving forward, to make sure that customers aren't going to pay a lot more for electricity?" she said.

PUC Chairman Robert Powelson said an "unprecedented spike" in prices accompanied the frigid temperatures in January and has already affected customers who signed variable-rate contracts for their electricity.

"Guess what's happened since?" Mr. Powelson said. "Those prices have come back to normal levels. This was not a situation caused by, obviously, suppliers out there arbitrarily raising rates. Those suppliers were buying that power in spot market purchase."

The PUC is examining marketing practices and how customers were notified about the expiration of fixed-rate contracts, he said. It also is considering changes to the disclosures required of electric generation suppliers, he told the Senate Appropriations Committee in written testimony.

The state attorney general's office said Wednesday it is working with the office of consumer advocate to determine if customers have been overcharged.

The PUC on Jan. 31 advised customers using a competitive supplier to review their contracts in light of the higher prices in wholesale electric markets.

PJM Interconnection, which operates the electricity grid for 13 states and the District of Columbia, said that in January it experienced eight of the 10 highest-ever winter demands for electricity in its history.

Mr. Powelson said upon questioning that two companies, IDT Energy and Pennsylvania Gas & Electric, have "the highest propensity of complaints."

A representative of IDT Energy said in a statement that the company is offering "goodwill credit adjustments" to customers who request relief from an unusually high bill.

The company said that in January the price it paid for energy on the PJM Western Hub, where suppliers purchase electricity for the Pittsburgh area, rose from less than $50 per megawatt per hour to more than $400 "as a result of the unexpected demand surge associated with the winter vortex."

"Over the longer run, our customers can expect to see their rates compare more favorably with the local utilities and fixed rate providers, who will seek to recover their higher incurred costs in the weeks and months ahead," the company said.

There have not been a particularly large number of PUC complaints in southwestern Pennsylvania. Just 35 complaints, or about 2 percent of the total this year, originated in Allegheny County. Dauphin, Lancaster and York counties, by contrast, account for nearly 1 in 5 complaints.

Karen Langley:, 1-717-787-2141 or on Twitter @karen_langley.

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