With electricity prices rising and a hot summer forecast, some electric customers may try to shop for rates as a way to save money.
But it's important to pay attention to the fine print when looking for a deal.
At a hearing on energy affordability this week in Harrisburg, witnesses told state lawmakers that low up-front rates do not guarantee long-term savings. In fact, shoppers tend to overpay for energy compared to those who stay with their default service.
Pennsylvania's competitive utility market allows people to compare energy suppliers and choose one with lower rates. Supply is only one portion of a utility bill; the other is distribution. Which distribution company you pay for service depends on where you live.
Electric company data shared with the state Public Utility Commission shows the average monthly residential electricity bill rose 57% between 2020 and 2025, from an average of $106 to $166.
Public Utility Commissioner Kim Barrow said shopping can save money if people are diligent.
" I often tell people, 'If you're going to shop, you can save money, but if you're going to shop, please understand, you have to work. It's a job,'" Barrow said.
Many contracts offered by energy suppliers last only a few months. When the term ends, the company can renew your contract at a higher rate or change your fixed rate to a variable one. Many people miss notifications about rate changes or don't understand what they can do.
Elizabeth Marx, executive director of the Pennsylvania Utility Law Project, said shoppers have been charged $2.6 billion more for energy bills over the past decade than they would have if they stayed on default service. She said low-income customers are hit the hardest.
"It is scary, and it should bother us all," Marx said.
Marx and other consumer advocates support Senate Bill 312, which would require electric distribution companies to automatically switch customers back to default service when a contract ends, if the customer does not take affirmative steps to enter into a new contract.
The proposal was introduced last year but has not been taken up for a vote.
State Consumer Advocate Darryl Lawrence said the bill should be passed as soon as possible.
"Why it has languished so long is a mystery to me because it is something that can be immediately done to take the burden of extremely high electric bills off of consumers, especially when they never signed up for such a contract to begin with," Lawrence said.
Lawrence said when Pennsylvania first allowed energy supply shopping in 1997, about 35% of consumers signed up. That quickly dropped to about 20% and has stayed at that level.
He said he's heard many horror stories, often from seniors on fixed incomes, who were unwittingly renewed to a contract with much higher rates and suddenly had bills in the hundreds of dollars.
"A customer that's burned once is likely to never go back," Lawrence said.
The trade organization that represents electric supply companies holds that S.B. 312 disrupts consumer choice.
Alex Charlton, state chair for the Retail Electric Supply Association, said people leave default service for a reason, and they may choose to pay more for a service they want, such as renewable energy generated in Pennsylvania.
"Simply mandating that they be returned to that standard service offer, one, disrupts whatever product they have chosen, but two — and I think probably more importantly — does not guarantee they're getting a cheaper price," Charlton said.
He added the competitive market allows options for consumers that otherwise would not be allowed, such as programs that discount rates during periods of low demand.
Those who want to shop should use PAPowerSwitch.com for electricity supply and PAGasSwitch.com for natural gas. Both sites are overseen by state utility regulators.
Shoppers can use the sites to see their default rate or "price to compare" and how it stacks up against offers from suppliers. Users can sort the offers by price and filter offers based on type of energy, term length, fixed or variable rate, and whether there are fees for starting, ending or maintaining service.
A fixed rate will offer more predictable bills. A variable rate can change each month. It's recommended shoppers look at base price as well as potential fees, whether rates can change with usage, and what customer service is like.
After signing up for a new supplier, be sure to look out for communication either through the mail or email about the terms of your deal and potential renewal.
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