By: Rep. Pete Daley, Minority Chair House Consumer Affairs Committee

Most of us are eager to put this winter’s snows and severe temperatures behind us.  However, what should not be forgotten are the damaging rate increases inflicted on the thousands of Pennsylvanians covered by variable-rate electric generation plans.

The state House of Representatives’ Consumer Affairs Committee, which I co-chair, will delve into the spiking rates at a public hearing scheduled for 9:15 a.m. Thursday, March 20 – the day spring arrives -- in Room 140 of the state Capitol.

Utility officials and representatives from the state Public Utilities Commission and the state Office of Consumer Advocate will testify, and similar across the commonwealth are envisioned.

I don’t want to assume greed spawned gouging, but it’s going to take some powerful persuasion to convince me otherwise. Four-fold increases in variable rates hardly qualify for the affordable and reliable service that was the selling point of electric deregulation in 1996.

Fast forward to 2014, and regulators confront horror stories of skyrocketing monthly bills, consumers slammed into variable-rate plans, questionable marketing practices and inscrutable contracts.

Further insult was added by the fact that Pennsylvania didn't get 10 days into 2014 before PJM Interconnections – the regional electric grid operator -- asked consumers to curb power use in portions of Pennsylvania because of soaring demand.

Months earlier, utility officials assured Pennsylvania that adequate supply existed to permit the mothballing of two reliable, coal-fired power plants in southwestern Pennsylvania. The plants could have been saved – as well as hundreds of good-paying jobs – to provide low-cost power when demand peaks.

Warnings had been sounded. The PUC filed a federal complaint in 2008 alleging that PJM produced “unjust and unreasonable” capacity charges from electric generators for guaranteeing power during peak demand.

That same year, a former PUC commissioner testified that that the PUC “has been reduced to rubber-stamping, usually in 24 hours,” the auction results from the “uncompetitive and unregulated” electric market.

This winter, even as default rates – those rates provided to the 60 percent of state ratepayers opting not to shop – remained relatively low and stable, legislation that would force Pennsylvanians to shop for power remained in play.

Stories abound of shopping ratepayers suckered in with low teaser rates on variable-rate plans only to see the rates double and then triple within weeks. The state Attorney General’s Office and the PUC are investigating whether electric company telemarketers are violating the state’s “Do Not Call” list by contacting consumers to switch suppliers.

The state Consumer Advocate cites concerns about customers being told their variable rate will always be competitive. Some ratepayers, she said, are being denied notice of what their rate actually is in any given month, having to wait to get their bill to see what they were charged.

The spike in variable rates -- by more than 120 percent in some cases -- has shed light on the lack of consumer protections available to customers of these unregulated generation suppliers.

Perhaps Pennsylvania should approach the coming hearings heeding the warning issued by a Republican governor--

“The toll unfairly taken from the people of this Commonwealth by reason of the unrestrained power of public utilities to set their own rates takes from the helpless rate payers and fare payers many tens, if not hundreds, of millions of dollars every year.”

The governor was Gifford Pinchot, and the year was 1931.

Rep. Pete Daley (D-Washington) is the Minority Chair of the House Consumer Affairs Committee.

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