PennFuture, Others Reach Settlement with PECO: An Out-of-the-Park, Bases-Loaded Home Run for Pennsylvania's Environment and Economy
Agreement Means $120 Million in Rate Cuts, Protection for Low Income Customers, Increased Funding for Green Energy and Economic Development
HARRISBURG, Pa., Sept. 13 /PRNewswire/ -- Citizens for Pennsylvania's Future (PennFuture) today announced that it and 11 other parties had reached a settlement with Philadelphia-based PECO Energy that will cut the costs of electricity to residential, small business and commercial customers; maintain current prices for the delivery of electricity (transmission and distribution, or T&D fees) for four more years; substantially expand assistance to low income customers; improve reliability of electricity to customers; increase economic development programs; adopt rules that will allow customers with solar panels or other personal power to sell excess electricity back to the company; and massively boost funding for renewable energy development and conservation programs. This record-breaking agreement comes after PennFuture and the other parties filed objections before the Pennsylvania Public Utility Commission (PUC) to the proposed merger between PECO's parent company, Exelon, and New Jersey's Public Service Enterprise Group Inc. (PSEG). Under Pennsylvania law, the PUC may not approve any merger proposal unless it can be demonstrated to be necessary or proper for public service.
"This agreement is an out-of-the-park, bases-loaded home run for Pennsylvania's environment and economy," said John Hanger, President and CEO of PennFuture, and former member of the PUC. "We gained funding for clean, renewable energy, and energy conservation. The agreement puts consumer protections in place for the Pennsylvania customers affected by this merger. It will save lives by increasing assistance to low income customers by $20 million. And most of all, it will cut electricity rates by a whopping $120 million to homes and small and large businesses.
"In an energy world in turmoil, where oil, gasoline, natural gas and even coal prices have increased by 100 percent to 400 percent in the last five years, PECO's electricity prices are a startling exception," continued Hanger. "PECO customers will pay less in constant dollars for electricity in 2006 than in 1996 - that's a remarkable achievement."
In addition to the millions in rate cuts, consumers will also get a four- year extension of the T&D rate cap that will otherwise expire on December 31, 2006. This extension is worth millions, and is unusual for Pennsylvania. In 2004, the PUC granted Allentown-based PPL a $194.3 million increase when that company's rate cap expired.
Renewable energy and energy conservation will also get a $19.2 million boost from the settlement, with PECO Energy paying $12 million to the Pennsylvania Energy Development Authority (PEDA) "for the purposes of funding renewable energy, energy efficiency and energy conservation," and $7.2 million to the Sustainable Development Fund. When combined with Pennsylvania's landmark Alternative Energy Portfolio Standard law, the Energy Harvest program, the sustainable development funds, and Pennsylvania's vibrant voluntary green energy market, the $19.2 million of renewable energy and conservation benefits from the settlement means Pennsylvania can build thousands of megawatts of new wind, solar, biomass, methane and energy conservation projects.
PennFuture participated in similar negotiations with PECO and Unicom when they proposed merging to form Exelon in 1999. In those negotiations, PECO's initial merger filing offered no benefits for consumers, the competitive market or the environment, but the final settlement was a step forward for all three. That settlement included a total of $32 million in support of renewable energy, of which $24 million was newly-committed funds and the remainder an accelerated payment of funds already committed; $15.5 million to support new wind energy development - enough to power more than 40,000 households each year; $4 million to finance the installation of rooftop photovoltaic panels to provide personal solar power; $2.5 million to fund public education on renewable electricity; and marked improvement in Exelon's "net metering" tariff to make customer installation of solar PV, fuel cells, or other personal power simpler and more economic.
If the current agreement is approved by the PUC, PECO customers will have received four, separate rounds of rate cuts since January 1, 1999, worth a total of $867 million. These cuts came as a result of the 1998 electricity restructuring case, the 2000 securitization agreement, the 2001 Exelon/PECO merger and now the Exelon/PSEG merger.
In addition to PennFuture, parties settling the case before the Pennsylvania Public Utility Commission (PUC) are the Office of Consumer Advocate, the Office of Small Business Advocate, the Office of Trial Staff, the Department of Environmental Protection, Action Alliance of Senior Citizens, the Association of Community Organizations for Reform Now and the Tenants' Action Group, the Philadelphia Area Industrial Energy Users Group, The Reinvestment Fund/Sustainable Development Fund, Energy Coordinating Agency of Philadelphia and State Senator Anthony Williams.
PennFuture is a statewide public interest membership organization that advances policies to protect and improve the state's environment and economy. With offices in Harrisburg, Philadelphia and Pittsburgh, PennFuture's activities include litigating cases before regulatory bodies and in local, state and federal courts, advocating and advancing legislative action on a state and federal level, public education and assisting citizens in public advocacy.
Source: Citizens for Pennsylvania's Future (PennFuture)
CONTACT: Jeanne K. Clark of PennFuture, +1-412-258-6683 or
+1-412-736-6092 (cell), Energyflak@aol.com
Web site: http://www.pennfuture.org/
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Profile: Utilities
