Residential and small-business customers of PPL Electric Utilities now have a second option for spreading out the 2010 increase in electricity supply prices that will follow more than a decade of capped rates.

The Pennsylvania Public Utility Commission on Thursday (7/23) approved a deferred payment option that PPL Electric Utilities filed earlier this year.

“We are committed to giving our customers options for spreading out higher prices, tools that can help them save energy and money, and information they can use to consider offers from alternative electricity suppliers,” said David G. DeCampli, president of PPL Electric Utilities.

The deferred payment option lets residential and small-business customers defer increases of more than 25 percent when higher electricity prices take effect starting Jan. 1. Customers who voluntarily choose this option will repay the deferred amounts, plus 6 percent interest, over a one- or two-year period.

PPL Electric Utilities will provide information to eligible customers about the deferred payment option in the fall, and invite them to enroll by Dec. 15.

PPL Electric Utilities already offers a prepayment option for spreading out the 2010 increase over several years. About 140,000 residential and small-business customers, 10 percent of those eligible, enrolled in that option when it was offered in fall 2008. Customers may still enroll in this program through the end of 2009.

Customers with the prepayment option have an amount added to their monthly bills that will be used to offset a portion of the increase. They earn 6 percent interest, paid by PPL Electric Utilities, on their advance payments.

PPL Electric Utilities does not generate electricity, and must purchase it from suppliers in a competitive market for customers who do not choose their own supplier.

With five of the six rounds of electricity supply purchases for 2010 completed, PPL Electric Utilities estimates that the average residential customer bill will increase by 30.4 percent, the average small-business customer bill will increase by 18.9 percent and the average mid-sized business customer bill will increase by 36.8 percent.
 
These estimated increases follow an extended period of capped rates that were set back in 1998 as part of an agreement with the state to implement the transition to a fully competitive electricity market. No state that opened electricity markets to competition has had rate caps in effect for a longer period than Pennsylvania.

PPL Electric Utilities, a subsidiary of PPL Corporation (NYSE: PPL), provides electric delivery service to 1.4 million customers in 29 counties of eastern and central Pennsylvania and has consistently ranked among the best companies for customer service in the United States. More information is available at www.pplelectric.com.