PHILADELPHIA, PA — A planned 12.5% electricity rate increase for PECO customers has been withdrawn, sparing households an estimated $30 or more per month, but lawmakers say broader concerns about rising utility costs remain unresolved.
What This Means for You
- A proposed PECO rate hike has been canceled, avoiding higher monthly bills
- Lawmakers are pushing for more transparency on utility profits and spending
- Many households are still struggling with existing energy costs and debt
The House Majority Policy Committee held a hearing Tuesday to examine utility pricing after PECO reversed its planned increase, citing affordability concerns following discussions with Gov. Josh Shapiro.
Lawmakers Press for Transparency
State representatives said the canceled increase does not address underlying concerns about how utilities set rates and use revenue from prior increases.
“Our responsibility is to ensure that utility rates are fair, justified and sustainable — because at the end of the day, these decisions impact every household and every employer in our communities,” said Rep. Morgan Cephas, who co-hosted the hearing.
Rep. Jennifer O’Mara said the public deserves more detailed accounting of how utilities have used profits from earlier rate hikes.
“If utilities are asking for more, the public deserves full transparency on where previous rate-hike profits went and specifically how they’ve been used,” O’Mara said.
Households Facing Financial Pressure
Testimony presented at the hearing highlighted ongoing financial strain tied to energy costs.
Witnesses said electricity terminations have risen 27%, while about 25% of households have reduced spending on food or medicine to pay utility bills. Officials also said approximately one in 20 households carries utility-related debt.
“People are struggling, trying to decide which bill they can afford to pay this week,” said Rep. Ryan Bizzarro, chairman of the Policy Committee.
What Drives Electricity Costs
Experts explained that electricity prices are influenced in part by regional power markets managed by the Pennsylvania-Jersey-Maryland Interconnection, or PJM, which coordinates electricity supply across multiple states.
PJM representatives said recent price increases were driven by rising costs in the “capacity market,” a system that pays power providers to ensure enough electricity is available during periods of high demand.
PJM has proposed capping those capacity costs through mid-2030, though officials warned that growing demand — particularly from large-scale data centers — could increase long-term infrastructure needs.
One hyperscale data center can require as much electricity as roughly 80,000 homes, according to testimony.
Infrastructure Risks and Future Demand
Utility officials also raised concerns about “stranded costs,” which occur when infrastructure investments are made but anticipated demand does not materialize.
That risk could emerge if new facilities, such as data centers, fail to come online after grid upgrades are completed.
Next Steps
Lawmakers said the hearing will inform future discussions on utility regulation and consumer protections, with a focus on balancing infrastructure investment needs against affordability for residents.
Support the local news that supports Chester County. MyChesCo delivers reliable, fact-based reporting and essential community resources—free for everyone. If you value that, click here to become a patron today.