Signifying that it has reached an agreement with six entities regarding a service rate increase it requested in March 2008, PECO filed a joint settlement petition Thursday with the Pennsylvania Public Utility Commission (PUC). The utility, which serves 1.6 million electric and 480,000 natural gas customers in southeastern Pennsylvania, said the increase is necessary to offset rising costs.
The settlement petition provides for a revenue increase of $76.5 million, or $21.8 million less than the $98.3 million originally requested. If approved by the PUC, the average monthly residential bill of $141.58 would increase by $10.83, or 7.6%. The average monthly commercial bill of $688.22 would increase by $50.38, or 7.3%.
PECO said the settlement would also significantly enhance PECO’s low-income programs, specifically its customer assistance program (CAP) and low income usage reduction program (LIURP). Under the plan, CAP would be expanded from two income-adjusted rates to four income-adjusted rates and funding would be increased from $4.3 million annually to approximately $13.7 million annually. Funding for LIURP, which provides free weatherization measures to low-income customers, would be increased from almost $900,000 to $2.25 million.
In the filing PECO proposed new energy efficiency programs. One of the programs is an appliance rebate program that would provide customers with a $300 rebate to replace old furnaces or boilers with high efficiency-certified models and a $50 rebate to replace old water heaters.
The utility said it is planning $280 million worth of investments to its system during the next five years. Among the reliability projects are increasing flow to portions of the service territory experiencing growth, repairing and replacing aging equipment and distribution lines and increasing system efficiencies.
The utility said the rate filing is also needed because of the rising cost of materials, citing the fact that the cost of steel pipe has risen 30% over the last five years and copper and brass fittings are up 35%. In addition, health care and other employee-related expenses have risen sharply since the last delivery service rate increase in 1988, it said.
PECO’s proposed settlement will be reviewed by an administrative law judge, who will provide an opinion to the PUC as part of the commission’s review of PECO’s rate request. Any approved rate adjustment would likely be effective no later than Jan. 1. The utility delivered 78.5 Bcf of natural gas and 39.9 billion kWh of electricity in 2007.
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