PECO Withdraws PA Rate Hike Proposal

PHILADELPHIA, PA — PECO will withdraw its proposal for rate hikes for customers in the Philadelphia region, the utility company confirmed Thursday.

The announcement was applauded by lawmakers who had written the utility after its proposal earlier this month.

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PECO President and CEO David Vahos issued a statement saying keeping utility bills "as low as possible" amid high energy costs was a "top priority."

Several Bucks County legislators had sent PECO a letter earlier this month urging them to reconsider their proposal, citing concerns that it would place additional financial strain on residents already facing high utility costs.

The pressure from lawmakers prompted PECO to withdraw its request before the Public Utility Commission to increase costs for ratepayers.

PECO had proposed the rate rate hike amid growing concerns from analysts and lawmakers over the impacts of rapidly growing data centers on the electrical grid.

Vahos said that while PECO's filing with the PUC would have provided "needed improvements in safe and reliable energy delivery," the utility company recognizes that local residents are struggling with basic necessities. As such, PECO has "decided to withdraw our proposal," he said.

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

The new proposal would have raised electric rates by 12.5 percent and natural gas rates by 11.4 percent, starting in 2027.

That means more than 2 million families around the Philly region would have paid, on average, an additional $20.08 per month for electricity and $14.52 per month for natural gas.

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. PECO also had received rate hikes of 10 percent for electric service and 12.5 percent for natural gas in January 2025, after which the company reported a 47.7 percent in net revenue, according to a coalition of state lawmakers, including State Sen. Frank Farry and Bucks County State Reps. Joe Hogan, Kristen Marcell and KC Tomlinson.

Despite this, PECO had been seeking an additional 12.5 percent increase for residential electric customers and 11.4 percent for residential natural gas customers at a combined cost of $429 million.

“We understand that an improved and reliable grid is critical to the success of our community, but a rate increase right now is unacceptable,” Farry said. “Increasing electric costs by 12.5 percent and natural gas costs by 11.4 percent would negatively impact the families we represent. We are glad that PECO has decided to withdraw its proposal and is putting affordability first.”

Vahos said PECO looks forward to "working with stakeholders across the region to find long-term solutions to high energy costs and to make needed investments at another time.”