WELLSBORO - Rates go up today for Wellsboro Electric Co. customers.
The Pennsylvania Public Utility Commission earlier approved a request by Wellsboro Electric Co. to increase its generation supply service rate for the second quarter of 2010. The new generation rate of 8.6542 cents per kilowatt-hour (kWh) is an increase of 1.3525 cents per kWh. The first-quarter rate was 7.3017 cents per kWh.
The new rate will be reflected on all bills rendered April 1 through June 30.
As a result of the adjustment, the monthly bill of a residential customer using 500 kWh of electricity will increase by $6.75 or 11.3 percent, from $59.64 to $66.39.
The bill includes generation and distribution charges, as well as state taxes.
The rate increase is a reflection of higher energy market prices coupled with an under-collection of power costs in the fourth quarter of 2009, according to Wellsboro Electric President and CEO Craig Eccher.
PPL seeks another rate increase
PPL Electric Utilities requested a distribution rate increase from the Public Utility Commission Wednesday.
If approved, the rate increase will be used to increase the company's revenue by 2.4 percent in 2011 to cover the cost of previous delivery system improvements, according to Ryan Hill, PPL spokesman.
With the rate increase, the average residential customer's bill would increase by $7.41 per month. The last time there were distribution rate increases was in January of 2008, when the bill rose $4.42 per month, according to Hill.
Since January of 2008, PPL invested about $727 million in distribution improvements, according to Hill.
The rate increase would change the bill of a residential customer who uses about 1,000 kilowatts of energy per month to $144.75 from the current, $137.44, according Hill.
"It takes an enormous infrastructure and great people to deliver for our customers in that defining moment when they flick the switch," said David G. DeCampli, company president. "Keeping that infrastructure strong is what this request is about."
It is anticipated that the Public Utility Commission will take about nine months to reach a determination. PPL hopes the rate increase may be made effective Jan. 1, 2011, according to Hill.
"It typically takes nine months for a decision from the Public Utility Commission. No changes will occur before Jan. 1, 2011," Hill said. "We are confident that after the PUC considers our request, that they will see the need for increased revenue. Without the increase, we will be unable to make the investment needed to maintain high levels of reliability."
There was a 30-percent rate increase in January for generation charges. Although that may be a hardship to some, PPL has many programs to help people who are struggling to pay their electric bill, according to Hill.
"We know that any increase could be difficult. We do have programs in place to help (customers having financial difficulties). We have a long history in place with helping customers who are struggling. Our commitment to them is as strong as ever," Hill said.
Pennsylvania law requires electric utilities to separate electric service on customer bills into two components: generation and distribution.
Distribution rates pay for costs associated with owning and maintaining the local wires and other equipment used to deliver electricity to customers.
The generation supply service rate, also known as the energy charge, covers the utility's costs associated with purchasing power for its customers.
The generation rate is adjusted quarterly and is a straight pass-through charge; as such, Wellsboro Electric is not permitted to make a profit on it.
Designated as a "provider of last resort" under the Pennsylvania's Customer Choice Law, Wellsboro Electric is required to purchase generation supply on the wholesale market for customers who do not choose a competitive supplier.
There are currently no competitive generation suppliers serving the Wellsboro Electric customer base.
Wellsboro Electric Co., 33 Austin St., Wellsboro, delivers electric service to more than 5,900 customers in Wellsboro Borough and Charleston, Middlebury and Delmar townships in Tioga County. It is a wholly owned subsidiary of C&T Enterprises.
C&T Enterprises is jointly owned by Claverack Rural Electric Cooperative, based in Wysox, and Tri-County Rural Electric Cooperative, headquartered in Mansfield.
The parent cooperatives provide electricity to about 36,000 consumers in northcentral and northeastern Pennsylvania.