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PPL Seeks To Return Customers To Default Service At End Of Customer Referral Program; Automatically Cancel Retail Supplier Contracts If Customer Enrolls In Low-Income Program; And Proposes End Of 6-Month Contracts For Most Residential, Small C&I Default Service 
March 12, 2024

As part of PPL’s recently proposed default service plan (DSP VI), PPL Electric Utilities (PPL) files petition and supporting witness testimony seeking changes to the Standard Offer customer referral program (SOP) that includes moving SOP customers back to default service unless the customer makes an affirmative choice to remain with their retail energy supplier.

Excerpts from PPL Witness SOP Related Testimony:

“Analysis of customer actions after the conclusion of the SOP contract has shown that most customers do not take any action upon expiration of their SOP contract and therefore are placed on a new contract at a new rate with their existing supplier. This result is problematic because the customer’s new rate is oftentimes higher than the currently effective PTC and higher than the customer’s previous rate.”

“82.45% of residential customers who remain with their SOP supplier after the conclusion of their SOP contract are paying a rate at or above the PTC in the first month following the end of their SOP contract. Even four months later, when approximately 18,000 customers have acted, of the remaining customers, 82.91% are still paying rates at or above the PTC, with over 76.11% paying 10% or more above the PTC. Only 17.09% of these customers are paying rates at or below the PTC.” 

“For the Small C&I customers, as the charts show, 86.28% of Small C&I customers who remain with their SOP supplier after the conclusion of their SOP contract are paying a rate at or above the PTC in the first month following the end of their SOP contract. Even four months later, when approximately 1500 customers have acted, the remaining 93.25% customers are still paying rates at or above the PTC, with over 87.45% of customers paying 10% or more above the PTC. Only 6.75% of these customers are paying rates at or below the PTC.” 

“The data shows that many customers do not take action for four months after the expiration of their SOP contract, and some customers take even longer. This includes some customers who are paying double the PTC from the time that their SOP contract ends.”

PPL testimony proposes SOP EGS’ agree to provide an additional notice to SOP customers.  Specifically, PPL proposes to require SOP EGS’ to automatically transfer SOP customers to default service upon the expiration of the SOP contract unless the customer affirmatively elects to remain a shopping customer.

“This notice will explain that the SOP contract is ending and detail what the customer is currently paying for generation supply as compared to what they will be paying when the SOP contract expires. The notice will also include the PTC that is in effect at the time of SOP contract expiration.” 

“This notice will request that the customer make an affirmative choice to stay with the SOP supplier or to be returned to default service. If the customer does not respond, the SOP supplier will be obligated to switch the customer to default service upon the expiration of the SOP contract,” “Returning customers who take no affirmative action at the end of their contract to default service will help customers understand that, if they elect to shop, they will be doing so through an EGS, not through PPL Electric.” 

“A SOP supplier would have an obligation to communicate to a customer after the expiration of a SOP contract each month until the customer takes some affirmative action. The communication would explain that the customer’s SOP contract has ended, provide the rate supplier is currently charging as compared to the rate the customer was paying under the SOP contract, and provide the current PTC. The communication would include instructions to the customer on how to choose what action to take after the SOP contract expires.”

Other PPL testimony proposed changes to SOP include:

Increase the SOP referral fee to $33 per customer referral, from the current $28.

Requiring suppliers to lock-in their participation status in the SOP 20 days before the start of the period rather than 5 days before.

Limit PPL customer service representatives to offering the SOP to customers only once per month. Currently, PPL Electric Customer Service Representatives are required to offer the SOP to all eligible PPL Electric default service customers who contact the Company call center, except for those calling for an emergency or for termination of services.

Other proposed changes to shopping & customer assistance program:

“PPL Electric would like to continue to prohibit OnTrack customers from shopping but modify its procedures so that the Company can automatically return OnTrack customers to default service upon enrollment in OnTrack,”

 “Additionally, the Company requests that the Commission order that suppliers are prohibited from charging early termination fees to customers who terminate their contracts to enroll in OnTrack.” 

PPL witness proposes a change from 6-month contracts to 24-month contracts in the supply mix based on the following: 

A witness for PPL recommends a change from 6-month contracts to 24-month contracts. 

“the Company has observed increased volatility in the energy markets, and in turn increased volatility in PPL Electric’s PTC. Specifically, the Company experienced its Residential PTC increasing from 9.502 cents on December 1, 2021, to 14.612 cents on December 1, 2022. The 12- and 24-month contract mix is a straightforward procurement strategy similar to what peer EDCs in Pennsylvania include in their Default Service plans and is intended to achieve more price stability for customers.”

“the Company desires to provide a more stable PTC, which the Long-Term Block product will support.”

Petition For Default Service Plan – PPL Electric  (03/12/2024)
P-2024-3047290  (03/12/2024)