Although electricity rates usually spike in the summer on increased demand, the current electricity market has allowed prices to actually fall thanks to new retail energy providers entering the market.
According to the Philadelphia Inquirer, Peco Energy Co. is expected to lower its residential electricity rate by 14.7 percent on July 1, the lowest rate the company has ever charged since the market became highly competitive 18 months ago. Energy deregulation laws in Pennsylvania have led some electricity rates to fall even further, down to 10 percent lower than the default rates set by Peco.
The new market came amid a confluence of other factors that have sent electricity rates groundward. A slow economic recovery, lower demand for power and less expensive natural gas have all contributed to lower prices.
“What you’re seeing are decreases because natural gas prices are lower,” said Cathy Engel-Menendez, Peco’s spokeswoman. “Natural gas is used to generate electricity, and lower wholesale prices for electricity are being passed on to customers.”
According to Pennsylvania Live, the new laws have widely been considered a success. Electricity customers are now able to shop around for affordable rates through several sites that have been developed.