The Pennsylvania Public Utility Commission (PUC) on June 4 approved a settlement authorizing an increase of $275 million in annual base distribution revenues for PPL Electric Utilities that will result in a 3.23 percent increase to residential customer bills.
The approved settlement resolves the company’s distribution rate review, supports continued investment in the electric system, and will strengthen customer protections and affordability programs, the utility said.
The resolved rate case follows an April 29 letter Pennsylvania Gov. Josh Shapiro sent to 24 electric, gas, and water utilities telling their CEOs that “the 20th century utility model is broken.”
“We can no longer simply prioritize corporate profitability to drive infrastructure development,” Shapiro wrote. “Rather, we must be laser focused on delivering on the actual needs of our communities.”
In his letter, the governor pointed to 13 utilities in the state that sought $975 million in additional rates in 2025 “after those very same utilities earned a total of $1.4 billion in profits in 2024.”
“We have reached a tipping point, and this is a moment to put your customers first and change the behaviors causing rate increases,” wrote Shapiro, who proposes that utilities should provide cost-benefit analysis of needed infrastructure upgrades and expansion, take on more low-cost debt, and publicly publicize the expected profits before a rate increase is approved.
“We thank the Shapiro administration for constructive engagement in our rate case and we share the governor’s focus on affordability as outlined in his recent statement of principles,” Christine Martin, president of PPL Electric, said on June 4 following the PUC’s approval of its settlement.
“While this rate case was settled prior to the governor’s letter, PPL Electric looks forward to engaging with the governor’s special counsel to fulfill the expectations of those principles in future rate case filings,” said Martin.
The approved settlement reflects a broad, collaborative agreement among customer advocates, environmental and business interests, and other stakeholders, according to PPL Electric.
The PUC found the settlement to be in the public interest following its review, which includes a minor modification related to net metering eligibility.
“This decision reflects a thorough and rigorous review of the company’s request and past performance,” Martin said. “This strong outcome supports our commitment to deliver safe and reliable electric service to our customers. It enables us to continue making critical investments to strengthen reliability — helping reduce outages and operate more efficiently — while expanding protections and support for the customers and communities we serve.”
PPL Electric said it will make targeted investments to enhance system performance and resilience, including replacing aging infrastructure, expanding vegetation management, advancing smart grid technology and improving customer service systems.
These investments are critical as the company responds to more frequent and severe weather, according to Martin.
The settlement also will support customers — particularly those facing financial challenges — through expanded low-income assistance, enhanced screening for eligibility, and no reconnection fees for income-eligible customers, said PPL Electric, which also plans to continue offering flexible payment arrangements, energy-saving tools, and programs to help customers better manage their bills.
As part of the PUC’s decision, the company also has established a new large-load customer rate class designed to support system growth while protecting existing customers.
The new rate class includes binding long-term financial and usage commitments, including a minimum 10-year requirement for large users such as data centers, helping ensure infrastructure costs are paid by the large load customers and not inappropriately shifted to other customers.
Beginning in 2027, $11 million annually in low-income program assistance will be assigned to these large-load customers through a non-bypassable charge, providing assistance to residential customers who need support while reducing these costs for other residential customers.
“As electricity demand grows, our priority is to maintain reliability, transparency and fairness,” Martin said. “These provisions ensure customers driving new infrastructure needs pay their share and existing customers are protected while supporting continued investment and economic growth.”
Bill changes based on estimated total bills as of July 1, are: residential (1,000 kWh/month) will see a $6.48 increase per month; commercial customers (1,000 kWh / 3 kW) will have a $4.08 increase per month; and industrial customers (150,000 kWh / 500 kW) will have a $332.54 increase each month.
As part of the decision, PPL Electric will not increase distribution base rates for at least two years following implementation.