Special Update on Expiring Met-Ed, PECO, and Penelec Rate Caps
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Electric rate caps linked to Met-Ed, PECO, and Penelec's generation billing component will expire January 1, 2011. Market energy prices have steadily increased since rate caps were established in PA in 1997. Market rates are now well above frozen generation prices. All generation components, including energy, capacity, transmission and ancillaries have increased over that time. Once the caps are lifted, January 1, 2011, generation rates will reflect the new market conditions.
Even though the rate cap expiration for Met-Ed, PECO, and Penelec is over one year away, it is not too soon to being planning and investigating options. In fact, we have several alternative suppliers who are willing to review and possibly quote rates for Met-Ed, PECO, and Penelec customers. Currently the suppliers are only interested in larger electric consumers with favorable load factors. However, the sooner businesses begin exploring options the better prepared they will be!
Clearly, major electric rate increases are coming. That’s the bad news. The good news is much of the increase can be avoided. Thanks to the recent dramatic pullback in natural gas and electric futures markets prices (result of the credit crunch and recession), customers that are able to lock in alternate generation supply can obtain pricing measurably below the default supply pricing. In fact, generation supply can be locked in providing price certainty and budget surety for two and possibly even three years at a significant discount compared to market rates!
UtiliTech Can Help. . . We monitor energy prices closely and will work with your company to develop a strategy to take advantage of the optimum timing & pricing.
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