Opinion: How Harrisburg can act now to lower energy bills

Energy affordability is a real concern, and there has been plenty of discussion in Harrisburg about reforming the markets run by PJM Interconnection, the regional grid operator that runs the wholesale electricity market across Pennsylvania and 12 other states and the District of Columbia.

PJM’s recent capacity auction results show a 630 percent increase in payments to power plant owners over two years — resulting in billions of additional dollars flowing to generators, ultimately paid by consumers. Reining that in is difficult because PJM and its generators aren’t regulated by Pennsylvania.Pennsylvania’s electric distribution companies (EDCs) are the first to hear from customers about the part of the bill over which they have the least control — supply from PJM. In fact, EDCs have no control. These charges from power plant owners are passed along directly to customers without a markup.

What EDCs do to help affordability for Pennsylvania customers is invest billions of dollars into Pennsylvania’s energy infrastructure to keep the lights on, employ thousands of union workers and provide more than half a billion dollars annually to customer assistance programs for the most vulnerable residents.

While Pennsylvania leaders have no authority over PJM’s market prices, there are things they can do right now to save families and businesses hundreds of millions of dollars.

One of the biggest opportunities is strengthening consumer protections in Pennsylvania’s competitive retail markets. Pennsylvania utilities support a competitive marketplace, but after two decades, we’ve seen our residential customers significantly overpay for their energy.

In one particularly troubling example, a Pennsylvania gas customer who was on a fixed rate was moved to a variable one. They owe their distribution utility about $140 for delivery, but they owe their competitive gas supplier more than $15,000. Customers deserve stronger consumer protections for variable rates, contract renewals and disclosure requirements. With competitive suppliers making millions from overpayments, it is past time to protect our customers.

Pennsylvania can also save customers millions by closing a gaping loophole in net metering. This laudable program was designed to give homeowners credit for sending excess electricity back to the grid. Instead, it’s become a financial windfall for large commercial solar generators who built a business around incentive payments. PUC Chairman Stephen DeFrank told the House Energy Committee that just 36 oversized solar projects are already generating roughly $6.4 million a year in above-market compensation — a number projected to top $90 million annually by 2027. With more than 2,100 similar interconnection requests pending statewide, the total exposure could exceed $700 million every year.

Pennsylvania’s net-metering policy is costing families and small businesses millions to support large solar developers who exploit legislative loopholes rather than supporting their use of renewable power.

Another way to save Pennsylvania customers millions annually is to reopen the border for Tier II credits under the Alternative Energy Portfolio Standards (AEPS) program. To support alternative energy, EDCs and competitive suppliers are required to buy these credits, with the costs recovered from customers. Tier I covers traditional resources such as solar and wind; Tier II covers larger facilities such as combined heat and power, hydropower and waste-derived energy.

Pennsylvania restricts who can compete to sell these credits and where. If you restrict supply, prices go up. Reopening the border and allowing out-of-state Tier II credits would increase supply and pass the savings on to families and businesses.The PUC’s own data tells the same story. The Tier II per-credit price has climbed to nearly $27, up from less than a penny a decade ago — an increase the PUC has called “meteoric.”

Statewide AEPS compliance costs hit roughly $702 million in the 2025 reporting year. That’s what happens when you have a shrinking, geographically restricted supply chasing fixed demand.

Pennsylvania needs more local generation, a reliable grid, strong utilities, competitive markets and policies that protect consumers. PJM will remain part of that conversation, but leaders in Harrisburg can and should act now by taking these steps to save Pennsylvania families and businesses hundreds of millions on their energy bills.

Andy Tubbs
President and CEO of the Energy Association of Pennsylvania