Best Philadelphia Electricity Rates

by jsgs45 on November 11, 2010

Electric Rates and Hidden Fees

Philadelphia Electric Bill

When picking between residential electric providers in Philadelphia you can get a little confused in the shopping process simply because advertising can be a little tricky.

Compare Electricity Rates in Philadelphia

I was looking at some residential electricity ads in the Philadelphia area today that I saw online and one thing stood out to me.

Additional fees and charges and how they are included in the advertised rate for PA electricity. Just like in other states sometimes these additional fees are not shown in the ads.

This type of pricing can be confusing if you are trying to budget what exactly your Philadelphia electricity rate will be.

Call to speak with a Philadelphia Energy Consultant at 1-800-971-4020

If you are after the best price there can be some confusion as well because what may look like the best price in Philadelphia may not have everything included.

One culprit could be this thing called “Stranded Costs”

Stranded Costs are also known as competitive transition charges or CTC for short. Basically the PA government has required some inefficient power plants to continue to run even though they are not profitable for the electricity generation plant.

This government regulation has nothing to do with a competitive electricity market and so these are kind of like taxes and fees from the government that get past through to the consumer from the generation company.

Regardless of whether you choose a competitive electric provider in Philadelphia that is new to the state or go with the monopoly utility in your area you will still have to pay these fees.

The Philadelphia electricity supplier could get away with telling you that they do not have to show these costs in their advertised electric rate since they are simply passing them on to you from the electricity generation company.

This can easily be a point of serious confusion for a residential or commercial electric service customer in Philadelphia.

It is important for you to know about these hidden fees and charges known as “Stranded Costs” and be sure to ask the competitive electric supplier you are thinking about signing up with if they have included these charges in their advertised rate.

This charge is a very easy thing a provider will want to leave off of their advertised rate to make their electricity rates and plans look cheaper than other Philadelphia electricity suppliers rate plans.

Below is more information on Stranded Costs in Philadelphia Electric Bills

Q: What are the “competitive transition charges” fees on my Philadelphia electric bill?

A: Stranded costs are expenses for PA electricity utility plants and equipment that were built before deregulation. Many of these old inneficient power plants are the coal fired plants built in the 50’s and 60’s. These energy costs cannot be recovered in a competitive electricity market but are needed to keep power being generated to meet demand for electric service. The Public Utility Commission of Pennsylvania allows electricity companies to recover some but not all of these costs through a transition charge on electric customers’ bills. These costs are now itemized on your PA electric bill; however, they are not new charges. Most of these costs were part of your rates under regulation. The CTC or Stranded Costs will be phased out over time. It is important to verify if the electric company in PA you choose has included these charges in their advertised rate plan so you know exactly what you are signing up for.

Q: Do we have to pay stranded costs if we are buying generation from a supplier?

A: Yes. Stranded costs have nothing to do with who provides your electricity service. All customers who receive PA electricity over the (Electric Distribution Company) EDC’s transmission and distribution system pay stranded costs. In some EDC (Electric Distribution Company) territories, these charges will disappear beginning in 2002.

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