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Electricity Deregulation in Pennsylvania
Pennsylvania started deregulating electricity in 1997, with the passage of the Pennsylvania Electric Generation Customer Choice and Competition Act. The overall goal was to separate the business of generating and selling electricity itself from the business of transmitting and distributing it to customers. Traditional electric utility companies (Philadelphia Electric Company (PECO), People's Power & Light (PP&L), Allegheny, Duquesne Light & Power, Met-Ed, Penelec, Pike County Light & Power, and UGI ) continue to be responsible for long distance electricity transmission and local distribution to individual homes and businesses within their regions, at rates fully regulated by the Pennsylvania Utilities Commission (PUC). Customers can choose to buy electricity itself from a variety of competing retail suppliers, who either generate electricity themselves, or buy it from generators at wholesale.
To ensure a smooth transition, the Pennsylvania Utility Commission ordered the electric utility companies to become the “default service supplier” within their service region. This means the utility must continue to provide electricity to customers in its region who don't switch to an alternative supplier, but at no profit. To avoid sudden price increases, the PUC also continued to set the price utilities could charge for electricity generation. These 'rate caps' were gradually removed region by region, allowing utilities to raise their rates, but also creating opportunities for other suppliers to sell electricity at better prices than the utility. As of January 1, 2011, all rate caps in Pennsylvania have been removed, and customers in most parts of the state can choose from among several alternative suppliers offering lower prices.
For Pennsylvanians, switching to a different supplier has no effect on their electricity service other than price. The local utility still handles service calls, meter reading, and billing,and guarantees a reliable, uninterrupted supply.
Shopping Online for Electricity
The Pennsylvania Utilities Commission took a number of steps to help consumers with the transition to deregulated electricity. One of the most effective has been the consumer-friendly website PA Powerswitch - http://www.papowerswitch.com/. Whether you are a residential customer or a small business, you will find lots of well organized, straightforward information to help you understand why you may want to switch electricity suppliers, what's involved in switching, and to answer common questions.
Where PA Powerswitch really comes through though is in making it easy to comparison shop for suppliers. As a public agency, the PUC is able to create an unbiased marketplace for consumers, and that's exactly what they've done. By entering their zip code, consumers can find a list of suppliers who can service their home, an overview of each supplier's current offers and prices, and contact information.
You can also find lots of information and tips on shopping for electricity on the website of the Pennsylvania Office of the Consumer Advocate (OCA) - http://www.oca.state.pa.us/, including tips on how to shop for electricity and compare prices for generation suppliers in each major electric utility service territory in Pennsylvania. The Office of Consumer Advocate is a state agency that represents the interests of Pennsylvania utility consumers before the Pennsylvania Public Utility Commission (PUC), federal regulatory agencies, and state and federal courts. The OCA is involved in rulemakings, policy statements, and state and federal level cases that involve either the price consumers pay for vital utility service or the quality of service they receive.
Major Players in the PA Electricity Supplier Market
Here are some of the most actively marketed alternate suppliers found on PA Powerswitch, with competitive offers in some or all regions of Pennsylvania:
- Blue Star Energy Solutions - an electricity supplier for residential customers and small businesses in Illinois, Pennsylvania, Maryland, and Washington DC., founded in 2002.
- Champion Energy Services - a residential commercial and industrial suppler in Texas, Illinois and Pennsylvania.
- Con Edison Solutions - a wholly-owned subsidiary of Consolidated Edison, Inc., the regulated utiltity company serving New York city.
- Direct Energy - Direct Energy is a major electricity generator as well as a retail supplier, with operations in 10 Canadian provinces and 46 U.S. states plus the District of Columbia.
- Energy Cooperative Association of Pennsylvania - A Philadelphia-based member-owned cooperative focused on sourcing electricity generated locally from renewable sources.
- Gateway Energy Services - a privately held retail energy marketer supplying natural gas and electricity to residential and commercial customers in 35 deregulated markets across Kentucky, Maryland, New Jersey, New York, Ohio, Pennsylvania, Texas, Virginia, the District of Columbia and Ontario, Canada.
- MX Energy - An independently owned natural gas and electricity supplier headquartered in Stamford, CT, serving 15 deregulated territories in the United States and two in Canada.
- North American Power - A wholly-owned subsidiary of North American Power Group Ltd., a privately held energy producer based in Colorado.
- Spark Energy - A Houston, TX-based retail energy service provider serving residential and commercial customers in 16 states starting in 1999.
- Stream Energy - Stream Energy is the parent company of Ignite, a network marketing distribution channel whose Independent Associates recruit energy customers on behalf of Stream.
- Viridian Energy - a direct marketer focused on electricity from renewable sources.