The Commissioners voted 5-0, noting the partial dissents of Vice Chair Kim Barrow, Commissioner John F. Coleman and Commissioner Ralph Yanora, to adopt the recommendations of Deputy Chief Administrative Law Judge Christopher P. Pell and Administrative Law Judge Barbara Shadie Nause, as modified by a motion from Commissioner Kathryn L. Zerfuss.
PPL Electric's original rate request sought an annual revenue increase of approximately $356.3 million. Under the Settlement approved today, the Company's annual revenue increase is reduced to approximately $275 million.
For a residential customer using 918 kilowatt-hours (kWh) of electricity per month, PPL Electric's original proposal would have increased the total monthly bill from $177.01 to $189.40 (approximately 7%).
Under the approved Settlement, the total monthly bill for that customer is projected to increase to approximately $184.49 (4.9%).
The Settlement contains a wide range of provisions related to customer affordability, reliability, large-load customers, and customer service improvements.
"This proceeding reflects one of the central challenges facing utility regulation today – balancing the investments necessary to maintain a safe and reliable electric system with the affordability concerns facing households and businesses across Pennsylvania," said PUC Chairman Steve DeFrank. "The Settlement significantly reduces the Company's original request while also securing meaningful commitments related to reliability, customer service, low-income assistance, and accountability. At a time when the electric system is facing unprecedented change, those investments and protections matter."
Extended Rate Case Stay-out
The Settlement includes a 2-year rate case stay-out which provides certainty on distribution rates for customers at a time of ever-increasing costs to consumers for all basic needs.
Consumer Enhancements Included in Settlement
The Settlement includes numerous measures affecting customer affordability, utility operations, and long-term system planning, including:
-- Increased funding for PPL Electric's Low-Income Usage Reduction Program (LIURP).
-- Expanded outreach to customers regarding available assistance programs.
-- Waiver of reconnection fees beginning July 1, 2027, for customers with household incomes at or below 150% of the Federal Poverty Level.
-- Additional protections, procedural improvements, and security deposit reforms related to low-income customers.
-- Enhanced call-center performance monitoring and reporting.
-- Expanded communications regarding payment arrangements and customer assistance programs.
-- Continued evaluation of customer service performance and program effectiveness.
-- Universal Service Costs Allocation increase to Rate LP-6 from $10 million to $11 million
Reliability and Infrastructure Accountability
The Commission also approved provisions intended to strengthen oversight of electric system performance.
Under the Settlement, PPL Electric will file annual reliability accountability reports tracking approved reliability programs, expenditures, completed work, targeted locations, and measurable reliability outcomes through its next base rate proceeding.
Electric Vehicle and Energy Innovation Programs
The Settlement modifies PPL Electric's Electric Vehicle Time-of-Use Charging Rebate Program, including revisions to program hours and continued incentives encouraging off-peak vehicle charging.
The program will be reevaluated prior to any continuation beyond 2030.
Large Load and Customer-Generator Provisions
The Settlement also addresses emerging issues related to large-load customers and customer-generators, including new tariff provisions applicable to certain large-load customers, such as data centers and other high-demand facilities.
These provisions include long-term service commitments, minimum demand guarantees, financial protections intended to reduce cost shifting to existing customers, and other measures designed to better align cost responsibility with cost causation.
Commission Modification Related to Agricultural Biogas Operations
The Commission adopted 3-2 a motion offered by Commissioner Kathryn L. Zerfuss modifying the Settlement's treatment of agricultural customer-generators.
The motion makes a narrow modification to the Settlement to clarify that agricultural biogas customer-generators are not swept into a classification designed for large, "no-load" net-metering facilities.
It recognizes the real distinction between on-farm biogas systems that power working agricultural operations and large projects built principally to export power.
This clarification ensures that on-farm biogas projects are treated in a way that reflects how they actually operate—and recognizes the role these farms play in strengthening Pennsylvania's rural communities.
“This motion is a simple modification to the Settlement ensuring that agricultural biogas customer-generators are not grouped into a classification they do not meet,” said Commissioner Zerfuss. “While technical in nature, this distinction recognizes the unique role family farms and agricultural operations play in both our economy and our energy future.”
Next Steps
Because the Commission approved modifications to the Settlement through Commissioner Zerfuss' motion, parties to the Settlement will have five business days to determine whether to withdraw from the agreement.
Following the expiration of the five-business-day withdrawal period established by today's Order, and if no party elects to withdraw from the Settlement, PPL Electric will file a compliance tariff implementing the approved rates and related provisions for service rendered on and after July 1, 2026.
Documents related to this rate case are available at PUC Docket No.: R-2025-3057164.
Click Here for the PUC announcement.
Reaction
Environmental groups involved in the PPL settlement issued this statement on the PUC action--
The Environmental Defense Fund, Natural Resources Defense Council and PennFuture intervened in this case to advocate for reduction to the financial burden on Pennsylvania customers, including through use of grid-edge technologies, innovative rate designs and fair rules regarding future data centers.
The environmental organizations ultimately achieved a joint settlement that took important steps toward achieving these goals and protecting customers as electricity demand grows across the Commonwealth.
The settlement includes provisions that:
-- Require large-load customers, including data centers, to pay for new infrastructure and system upgrades needed to serve their electricity demand.
-- Establish rules for PPL’s contracts with large-load customers, including upfront payments, revenue guarantees, exit fees and minimum contract terms, to help protect other customers from future cost shifts.
-- Require large-load customers to contribute approximately $11 million annually to PPL's low-income assistance programs.
-- Commit PPL to work with stakeholders to develop new electric vehicle charging rates designed to encourage charging when electricity demand and costs are lower.
-- Advance planning for improved management of distributed energy resources through development of a potential grid orchestration plan.
As Vice Chair Kimberly Barrow acknowledged, PPL has not increased its base rates in 10 years and much has changed in that time.
This settlement ensures that people will have access to the reliable power they need, with protections against increased burdens driven by new large loads.
Michael Zimmerman, Director & Senior Attorney of Clean Affordable Power, EDF, said “Today's decision demonstrates that Pennsylvania can support economic growth while protecting households and small businesses from unnecessary costs. By requiring large-load customers to contribute to the infrastructure they need and strengthening customer protections, the Commission has established an important model for managing rapid large-load growth.”
“With large load customers, including data centers, driving unprecedented growth in electricity demand, along with uncertain costs and consequences for everyday Pennsylvanians, it’s critical that regulators and utilities manage this growth responsibly,” said Robert Routh, Pennsylvania Policy Director, Climate & Energy, NRDC
“The PUC’s approval of this settlement agreement moves Pennsylvania in the right direction. NRDC, PPL, and all parties negotiated in good faith to arrive at a reasonable compromise that will allocate costs more fairly and set clear rules of the road in PPL’s service territory,”
Emma Bast, Senior Attorney, PennFuture, said "Large load customers present a new set of challenges for the grid, but the Commission’s decision confirms that responsible development is possible, fairness can be applied to future data centers or other large load entities without harming progress, and everyday working people do not have to pay unsustainable costs for increased industry demand.
“PennFuture applauds the Commission's decision and its encouragement for utilities to further develop critical consumer protections in the future.”
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[Posted: June 4, 2026] PA Environment Digest
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