New Castle News

March 1, 2014

Local residents shocked by electric bills

Mary Grzebieniak
New Castle News

NEW CASTLE — Jenny Pierog of North Beaver Township thought her Christmas baking had driven her electric bill up to $700 for December.

The 86-year-old didn’t know what else it could be.

“We didn’t burn any (Christmas) lights; we don’t have that much on.”

She and her husband, Stan, live in an all-electric home and usually get a bill between $200 and $300.

Their daughter, Alicia Craig, said they had the electric meter checked, but it was fine. Then they pulled the plug on a supplementary heater, thinking it might be responsible.

When a $1,300 bill came in January, Craig said, she was afraid her mother would have a stroke.

The Pierogs are among Pennsylvania residents who recently received shockingly high electric bills because they chose electric suppliers with variable rates.

Some suppliers’ rates have tripled or quadrupled, according to state Rep. Robert F. Matzie of Beaver County. The Pennsylvania Public Utility Commission has received 750 complaints about the increases.

Craig said her parents had switched over to Pennsylvania Gas and Electric some time ago and saw their kilowatt hour rate grow to 9 cents in December, then double to 18 cents in January. She said this is three times the rate offered by Penn Power.

“I talked to Penn Power and told them get my parents off — switch them back to Penn Power,” she said. But “they told me it would be one more month” before the switch is complete.

Local businessman Darryl Audia also was stunned to find his electric bill had tripled for his Hickory Township home. He said he intends to investigate why there was no mechanism in place to seek PUC approval and to notify him when his kilowatt hour rate jumped from 5 cents to “17 or 18 cents.”

He said that when he switched to a variable rate, his understanding was there was a cap on the rates and that he would be notified in case of such a large hike.

“It’s embarrassing for me to be hoodwinked,” he said, noting he has been in the real estate business for many years as well as working for government. He compared the situation to filling up his gas tank and only later being told the cost per gallon.

Kathy Donegan, who also lives in Hickory Township, said that she had switched to Ambit Energy, a Texas company, after reviewing its website. She said she knew her rate was variable, but was convinced to change because the website listed its average kilowatt rate as lower than some other suppliers.

However, she was surprised when her January bill was $170, nearly four times her normal $45 bill. She said she thought it was because of the cold weather and the fact she was using a space heater. But she still thought it was odd because “I turn things off; I try to keep things off” to conserve energy.

Doug Marcille, president and chief executive officer of Pennsylvania Gas and Electric, one of the companies that increased its rates for customers on variable contracts, said many factors contributed to the increases.

They were the result of “a perfect storm of events that was unprecedented.” He explained that the polar vortex caused “more days below freezing and below zero than ever before,” driving up demand. The evolution of electricity generation from coal to natural gas also caused market conditions that contributed to the price spikes, he said.

Despite the high bills, he noted, his company has not passed all of its costs on to the customers. “We are losing money.”

Marcille said he believes the market will stabilize, adding the company will work with customers to deal with the high bills “depending on the situation.”

Consumers with a computer can get more information by logging on to www.papowerswitch.com and clicking on “Shop For Electric Suppliers.”

Meanwhile Matzie also wants the state to look into why it takes an entire billing cycle for a customer to switch to another supplier. He said he also has heard reports that some customers were put on variable rate contracts without their knowledge after their fixed rate contracts expired.

The Pennsylvania House Consumer Affairs Committee has scheduled hearings on the matter over the next few weeks.

(Email: grzebieniak@ncnewsonline.com)