Peco’s Proposed Rate Hikes and Contract Talks: What They Mean for You
Peco has formally asked Pennsylvania regulators for permission to raise both electric and natural gas rates. The company says the increase would take effect in 2027. At the same time, talks with its unionized workforce remain unresolved.
Why the company says it needs more revenue
Peco executives estimate $520 million is required for major grid upgrades. They cite rising demand and the need to bolster reliability during severe weather.
Planned improvements include stronger poles, more durable aerial cables, new transformers, and drones for faster damage assessment. Senior vice president Doug Oliver noted sharp increases in wholesale electricity costs.
Recent rate changes and bill drivers
The Pennsylvania Public Utility Commission approved prior increases split over two years. Electric bills rose about 10% in 2025 and roughly 1.8% this year. Gas customers saw a 12.5% rise beginning last year.
Supply costs climbed nearly 20% for electricity and 10% for gas from 2024 to 2025. Weather, thermostat settings, and home efficiency also affect individual bills.
Union contract talks and labor actions
IBEW Local 614 represents roughly 1,600 Peco union employees. The company employs about 3,000 people overall.
Workers include linemen, gas mechanics, and call center staff. Union leaders seek pay increases and a unified retirement plan for all members.
About 600 employees hired since 2021 lack a pension. Those with pensions are divided among multiple plans.
The union filed an unfair labor practice charge with the National Labor Relations Board. Union president Larry Anastasi said a strike authorization vote is becoming more likely.
Company finances and executive response
Peco serves 1.7 million electric customers and 553,000 natural gas customers in Southeastern Pennsylvania. It operates as one of six utilities under Exelon.
Exelon reported Peco net income of $814 million last year, a 48% increase from 2024. Exelon noted higher distribution rates and favorable weather as contributing factors.
Chief operating officer Nicole LeVine said about 90% of ratepayer payments return to infrastructure and employee wages. She described the company’s bargaining offer as fair and said Peco is negotiating in good faith.
Data centers and cost allocation
Peco has signed two transmission security agreements with data center customers. Those contracts aim to hold large users accountable if they leave after grid investments.
Company leaders say revenue from such large users could help delay future rate requests. They also stress that the rate filing covers system-wide investments, not only data center needs.
Regulatory review and consumer input
The Pennsylvania Public Utility Commission’s ratemaking process usually lasts about nine months. It can reduce the increases utilities request.
The process includes hearings, expert testimony, and public comment opportunities. Consumers may submit written comments or speak at hearings.
Filmogaz.com will track developments on Peco’s proposed rate hikes and ongoing contract talks. We will explain what they mean for you as the situation evolves.
