PPL Electric Utilities
PPL Electric Utilities wants to add competition and simplicity to Electric Choice in hopes of adding participation.
In a plan announced Wednesday, PPL proposes to change its price twice a year, not quarterly as it does now.
PPL also would roll out two initiatives intended to spur competitors to beat its fixed price — now among the lowest — by at least 5 percent.
The proposed changes would take effect in June 2013 after a review by the state Public Utility Commission that could last nine months.
The rate initiatives should sound familiar to the PUC.
The commission recommended them after its statewide study of ways to get more consumers to switch from utilities.
Electric Choice got off to a roaring start in PPL's 29-county territory on Jan. 1, 2010, as state-mandated caps on PPL's rates expired.
That expiration caused PPL's rates to soar 29.7 percent.
Numerous alternate suppliers swooped in, with prices 10 to 12 percent below PPL's.
Over time, more than 30 alternate suppliers arrived in PPL territory, convincing 41 percent of PPL customers to switch.
But since that initial rate surge, PPL's rates have steadily retreated, nearly receding to where they were before the rate-cap expiration.
This decrease has erased the early advantage enjoyed by many alternate suppliers and slowed the flood of switching to a trickle.
Enter the PUC.
At the PUC's recommendation, PPL is proposing to hire an independent third party to hold an auction where alternate suppliers would try to be the low bidder to serve PPL customers who have volunteered to switch.
Volunteers would get a small bonus, perhaps $50, to take part. The bids would need to be at least 5 percent below PPL's price.
Also at the PUC's recommendation, PPL is proposing to launch a "standard offer" program. This, too, would serve PPL customers who've volunteered to switch.
However, alternate suppliers who wish to take part would offer a set price that's at least 7 percent below PPL's, rather than bid to serve these customers.
The participating customers would be allowed to pick which of the participating alternate suppliers they wanted to switch to. Or the customer could be assigned to a participating supplier at random.
