Many Pittsburgh-area households received an unwelcome surprise in their mailbox this month: energy bills that were up to 35% higher. If you are a West Penn Power customer, the average monthly electricity bill increased $32, from $92.47 to $124.42.
What’s behind this painful bill? For starters, for the first time in twenty years, West Penn Power increased the distribution rates and fixed charges that all customers pay to have their electricity delivered. At the same time, the price that West Penn Power charged its customers for the actual energy they consume, called supply, skyrocketed. Unfortunately, July is the month when all of these recent rate increases hit your energy bills.
Check out the graphic below to see how these increases break down for a typical household that uses 1,000 kilowatt-hours of electricity a month.
Your Energy Choices
What you may not know is that you can take control over a significant portion of your energy bills: the rate you pay for the supply portion of your bill. That means that when bills jump up as they did this summer, you can switch to a competitive energy supplier and potentially reduce your energy bill by hundreds of dollars per year on your electricity bill, if you shop smart.
Before you start shopping, it helps to understand your options. And options you have: from fixed rates to variable rates, short term to long term, the choices can start to add up. Here are a few of the key things you should know when shopping for an energy plan:
Your Price to Compare. The price to compare, or PTC, represents how much you would pay your utility for each kilowatt hour of electricity you use. This information can always be found on your utility bill–utilities are required to disclose it–and will help you understand how much you can save by switching to a new plan. The current West Penn Power Price to Compare for residential customers is 7.311 cents per kilowatt hour through the end of August. This rate increased from 5.331 to 7.311 cents per kWh on June 1.
Short term vs. long term contracts. You can find plans that last as little as three months or as long as 36 months. Shorter term plans often offer lower rates, but you risk rolling on to a higher priced plan at the end of the term. The longer term plans provide peace of mind from locking in stable, predictable prices. But make sure you’re ready to commit for the long term: these plans can come with hefty early cancellation fees.
Fixed vs. variable rate. Selecting a fixed rate plan means that you’ll pay the same rate for your electricity for the duration of the plan. Many people favor these plans due to their predictability: the rate you pay for your electricity won’t change from month to month. Some suppliers also offer variable rate plans, which means that the price you pay for your electricity varies month to month based on the market price. You may get a great deal on rates when market prices are low, but beware, you’ll be on the hook if rates suddenly skyrocket.
Renewable energy options. When you buy your power from a retail supplier, you also have the choice to purchase renewable energy plans. For West Penn Power customers, this typically means you’ll be buying your power from wind farms–helping to reduce global climate change with no effort on your part. The best part: sometimes, these plans can even be cheaper than the price to compare.
Energy shopping can be confusing, but knowing a thing or two about your options before getting started makes a big difference in reducing your energy bills. Choose Energy can help you select an affordable plan that will lessen the sticker shock of this summer’s bill increase.
It’s so weird how variable energy prices are by region. Like, here, I’ve never paid more than $40 for an electric bill but have paid $150+ on gas during the winter. Meanwhile, back in the Southwest $10 on gas was typical plus $125 for electric. Weird.
That is really weird. Supply and demand? Maybe? Something to look into.
Only a matter of time before stuff like that hits Wisconsin, I think we’re currently closer to your old rates. Luckily it’s been another cooler summer in Wisconsin, most days haven’t even hit 80! I think I’ve ran my A/C a total of 5 days and only for a couple hours. I’ll have to get going on my wind turbine project soon and start using more renewable resources.
That is nice! We’ve had a relatively cool summer in my region of PA, but definitely had to kick the air on more than five times. A turbine in Wisconsin sounds perfect!
That’s quite the increase. Ouch! We just got hit with a 9.6% increase. We can’t control our rates but we can control our usage!
That is true. There are lots of things you can do to control usage when your area doesn’t offer competition. Could be a while other post!
That’s one thing I love about living in a big city. More options than a small town. The price competition usually results in savings!
Truth. Though in PA we are pretty lucky in that we have options statewide. Not 100% sure that we have more or less than the small towns, but we do have options from Pittsburgh to Philly. At least with electricity. 🙂
For the first time in forever my bill was lower than ever for July. The reason why is because July was the highest ever for us. Always. I have a big home and with a big home comes high utilities. What we decided to do was pay our bill higher and see how it went and it paid off. I think I will do this again for next year.
Nice! Paying more than the budget amount really pays off come the more expensive months!
One of my biggest expenses is my electricity bill. Even if we are living in a small city, it’s really weird that our electricity bill still increases even if I didn’t use our AC.
That is weird. I’d keep an eye on my own meter and make sure they weren’t over charging me hoping I wouldn’t notice.
Our rates went up too. I have been challenging myself to go without using the air conditioning to lower our bill and maybe be a little more environmentally friendly. The hot tub is the worst energy hog and we have been turning it down when it is hot outside. My husband it keen on looking into solar.
Ohhh let me know how that turns out! I really want to do solar when we get our own place.
This post is terrific! My electric bills never made any sense to me and the notion of shopping around was overwhelming, since I didn’t even understand what I was looking for.
It definitely can be overwhelming. I don’t think many people understand it. The biggest gotcha to watch out for when shopping around is to make sure you’re getting a fixed rate in my opinion!
Here there is only one place to get electricity–unless you get one of those rooftop solar systems
That’s rough. I’d still look into it. Here there is really only one provider per region for delivery, but generation you can shop around for. It’s something not too many people know about, so possibly it’s a well kept secret in your area? Maybe not, too. Taking an optimistic outlook on this one. 🙂