PECO drops plan to raise gas, electric prices in southeast PA

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PHILADELPHIA - PECO is withdrawing its request to raise rates for millions of homes in southeastern Pennsylvania, the company's third proposed rate hike in four years.

PECO withdraws rate hike request

What we know:

The company and Pennsylvania Gov. Josh Shapiro announced the decision on Thursday.

Earlier this year, PECO submitted a rate review filing with the Pennsylvania Public Utility Commission (PUC). In a press release, PECO said it was taking back the request to alleviate "sustained financial strain driven by rising costs for housing, food, healthcare, transportation, energy supply costs, and other everyday essentials."

The company said it made the decision after talks with Shapiro, and input from customers and the community. PECO planned to use the money to modernize their gas and electrical systems, but ultimately decided "now is not the right time to move forward."

By the numbers:

The proposed rate hikes would have impacted approximately 1.7 million customers, according to the governor's office, and would have raised the average electric bill by more than $20 a month, and the average natural gas bill by nearly $15 a month starting in 2027.

Thursday's decision, Shapiro's office said, could save homes up to $34 a month in utility costs.

Shapiro blames Trump admin, war in Iran

What they're saying:

PECO President and CEO David Vahos reiterated t

"While our filing with the PUC would have provided needed improvements in safe and reliable energy delivery, we recognize that Pennsylvanians are struggling with basic necessities like gas, food, and energy and have decided to withdraw our proposal," Vahos said.

Shapiro blamed the "Trump administration's chaotic economic policies and the war in Iran."

"PECO’s proposed rate case would have increased Pennsylvanians’ utility bills, but I demanded that their CEO put customers first and withdraw their rate hike request," Shapiro said. "PECO listened, and I appreciate that the company is willing to prioritize affordability at a time when Pennsylvanians are worried about rising costs."

Dig deeper:

According to the U.S. Board of Labor Statistics, prices are up across the board over the last year— just over 3%. 

But energy costs have seen a much more drastic increase, with electric and natural gas prices increasing by 4.6% and 6.4% in the last year, respectively.

PECO says that things like artificial intelligence, data centers and more led to energy use hitting an all-time high in 2024, and that PJM Interconnection, which manages the electric grid in the region, could see capacity shortfalls by 2027.