PECO Proposes Significant Rate Hikes Amid Data Center Growth, Sparking Outrage In Montco

MONTGOMERY COUNTY, PA — PECO has proposed a massive rate rate hike for customers across the suburban Philadelphia region this week, amid growing concerns from analysts and lawmakers over the impacts of rapidly growing data centers on the electrical grid.

The new proposal would raise electric rates by 12.5 percent and natural gas rates by 11.4 percent, starting in 2027. That means more than two million families around the Philly region would pay, on average, an additional $20.08 per month for electricity and $14.52 per month for natural gas.

"(PECO is) making record profits, and at the same time asking working families to pay more, all while gearing up to serve massive, energy-hungry data centers that will put serious strain on the grid," State Sen. Katie Muth said. "Working people should not be subsidizing billion-dollar upgrades for big tech while struggling to keep up with rising utility costs."

The state legislature passed the Ratepayer Protection Bill last week, an effort to force the Pennsylvania Utility Commission (PUC), which oversees PECO, to more strictly regulate data center development. Part of the purpose of the bill is to prevent the exact type of hikes that PECO introduced this week.

PECO customers already saw a rate hike of about 10 percent in the beginning of 2026, coming out to about an additional $13.58 per bill.

"While residents of Pennsylvania are concerned over grocery costs, finding affordable healthcare and the rising price to fill their gas tanks, these proposed increases are unacceptable," State Rep. Joe Ciresi added. "Many Pennsylvanians are already stretched thin from prior utility rate increases."

A coalition of lawmakers in Montgomery County has submitted a letter to the PUC to urge them to reject the hikes.

In their announcement, PECO said they "don't take the request lightly."

“Our customers deserve a system they can count on, especially as severe weather grows more frequent," David Vahos, PECO president and CEO, said in a statement. "These investments will strengthen the grid, reduce outages, and ensure we’re delivering the safe, reliable service our customers expect every day."

Beyond just the pressures added by data centers, PECO is also facing damages from climate change-induced severe weather, as well as aging infrastructure.

Oddly, PECO has announced the hikes at almost the exact time their contract with their labor union is set to expire. Workers with the IBEW Local 614 have threatened to strike if PECO does not negotiate a new contract. They have described PECO as "unserious" in negotiations. The union has never had a strike in its 20 year history of working with PECO.

Public input hearings on the rate hikes are scheduled for June. PUC will likely not vote on the proposal until later in the year.