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PUC Chair Warns Suppliers, While Defending Electricity Rate Hikes

PITTSBURGH (KDKA) -- After KDKA-TV first broke the story of outrageous spikes in electricity rates by some suppliers such as IDT Energy and Blue Pilot Energy, many viewers emailed their stories to money editor Jon Delano, including Eva Mae Byers who got hit with a $2,000 electricity bill.

Delano: "Could you pay a bill like this on social security?"

Byers: "Absolutely not. No way."

Now the chairman of the state's Public Utility Commission has a simple message for these companies.

"What are you doing to work with these customers?" asks Robert Powelson.

"There are some great examples and then there are some others out there," he added. "We're going to make darn sure at the end of the day if their cleats are over the chalk line, we'll revoke a license."

But the PUC chair defends the state's electricity choice program which has burned those customers who were promised lower-priced variable electricity rates -- even though some suppliers are doubling, tripling and even quadrupling rates.

KDKA-TV showed Powelson a PUC "Shop, Switch, Save" brochure.

Delano: "Shop, switch, save -- that's a lie."

Powelson: "It's not a lie, Jon."

Powelson blames the spike in rates on this winter's weather.

"If we didn't have the polar vortex, we probably wouldn't be having this interview," he said.

But he says consumers who opted for variable -- instead of fixed -- electricity rates share blame.

"These are variable rate products that customers have affirmatively signed up for," Powelson said.

What about lack of notice?

Delano: "I think there is something unconscionable about a utility doubling, tripling rates without notice. Do you agree?"

Powelson: "It's not a utility. It's a generation supply company."

Delano: "But from the view of the customer, it's a utility. It's their electricity."

Powelson ducked the question, but insisted the PUC is encouraging suppliers to roll back those bills.

"Some companies are even doing rate roll-backs. Why are they doing that? They don't want to lose those customers," he adds.

KDKA asked the questions customers have been asking.

Delano: "Shouldn't there be notice to customers when they're dramatic price spikes?"

Delano: "How do you define hoodwink when it comes to these companies?"

Delano: "How can a senior citizen on social security pay a $2,000 a month utility bill?"

Powelson ducked the notice question and defends the state's electricity choice program, saying recent price hikes are weather-related.

"We had polar vortex one and polar vortex two," he said.

He says customers -- who opted for variable -- and not fixed -- electricity rates took a chance -- but adds, "We're concerned because we think the suppliers that have customers in these products should be working very hard to provide customers a safe landing."

And that includes adjusting the bill downward, especially for seniors on fixed incomes.

As for one frequent complaint that it takes too long to switch -- up to a month -- from a high-priced supplier back to a cheaper one, Powelson agrees.

"Customers want real-time switching," he said. "In the state of Texas right now, you can sign up for retail energy supplier and it can be done in five minutes. We've got to get there."

But Pennsylvania may not, he says, until 2020.

As for suppliers who hoodwink customers, the PUC will look at bait and switch tactics.

"If there are actors out there who are not playing by the rules, they will not be in business in Pennsylvania," Powelson said.

Powelson encourages everyone who has been affected by outrageous price hikes to call the PUC to tell their story.

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