Pennsylvania Power & Light Co. this week filed replies to comments made by various parties on the company's proposed retail pilot program.
As part of its reply, the company is proposing to increase the credit that participating customers would receive to shop for the company that sells their electricity to them.
PP&L was the first electric utility in Pennsylvania to propose a customer choice pilot program when it filed its plan with the state Public Utility Commission last October. In late February, PP&L proposed enhancements that will make the program better simulate the competitive marketplace.
Following that February filing, the PUC received a number of comments on the company's plan. In this week's filing, PP&L replies to those comments.
"Since we filed our enhanced pilot program in February, we have new estimates of the prices that customers can expect to pay for electricity in the competitive marketplace," said Paul Russell, PP&L's associate general counsel. "We have increased our proposed credits to reflect those new estimates."
Russell explained that the new estimates are the result of work done for the company's restructuring plan, which was filed with the PUC on April 1. "In the reply we filed today, we are requesting permission to increase the credit to match the market prices that are assumed in our restructuring filing," said Russell.
If the PUC approves PP&L's latest proposal, customers who participate will receive a credit of 2.2 to 2.6 cents on their bills for each kilowatt-hour of electricity they purchase in the competitive market. The credit will vary based on customer class — residential, commercial or industrial. A customer's net savings will reflect the cost of electricity purchased by the customer in the competitive marketplace compared to the customer's credit.
A total of 54,000 PP&L customers will have the opportunity to participate in the pilot, after it is approved by the PUC. All customers will be given the opportunity to volunteer for the PP&L pilot.
Pennsylvania's other electric utilities also have filed pilot proposals with the PUC. The Pennsylvania pilot program will be the largest in the United States. About 250,000 electric customers from all the major investor-owned electric utilities in Pennsylvania will be able to choose from among competing suppliers of electricity, including PP&L.
"As part of the pilot programs, PP&L will offer generation priced at competitive market levels to customers throughout Pennsylvania," Russell said. "We intend to compete for our own customers and the customers of other utilities. We're confident that PP&L will be very competitive in this emerging energy marketplace."
Russell said customers could be buying electricity from alternative suppliers as soon as this fall. After the PUC approves the program, all PP&L customers will receive information on the program, how it works and how customers can enroll. Customers who enroll in the pilot program will be part of the first group of customers eligible under state law to participate in full customer choice. Pennsylvania law phases in customer choice beginning as early as 1999 with about one-third of the state's electric customers. All customers will have choice as early as 2001.
In the new competitive electricity business, PP&L will continue to provide customer service, deliver electricity and maintain electric lines. There will be no additional electric lines brought into homes or businesses, and all existing customer services will continue.