How PECO is Tackling Energy Affordability on Three Fronts

Rising energy costs have become a mounting burden for families across Southeastern Pennsylvania. For an average family of four, even the smallest increase on a monthly energy bill can force difficult tradeoffs between, for instance, groceries and keeping the air conditioning on.

That creeping financial instability is the problem PECO is addressing through the Exelon Promise, an all-of-the-above approach to affordability designed by Exelon, PECO’s parent company, to keep bills manageable through three connected strategies: immediate relief, near-term cost protection, and long-term policy reform. “The Exelon Promise has to be felt in a very immediate and tangible way,” Doug Oliver, PECO’s senior vice president of governmental, regulatory, and external affairs, said. For customers, that means the plan must translate into meaningful support now.

While PECO doesn’t produce energy or set supply rates, it is responsible for the infrastructure that delivers energy to customers in Southeastern Pennsylvania. Now, as rising costs put pressure on household budgets, the company is expanding its role in addressing energy insecurity and finding creative ways to make sure that anyone who needs help knows where to find it.

Finding solutions today

For PECO, delivering on the strategies in the Exelon Promise begins with providing immediate solutions for struggling customers.

Established energy assistance programs are critical to the mission. The company connects more than 140,000 customers with energy assistance annually and delivers more than $200 million in support to households across its service area. That support took on several forms, depending on a household’s income, needs, and eligibility.

“We’re actively meeting customers where they are. We’re out in our communities talking to people and connecting them to our programs in the short term.”

For customers with a household income at or below 150% of the annual federal poverty level (FPL), for instance, PECO’s Customer Assistance Program (CAP) limits monthly bills at a percentage of household income. A qualifying family of four earning less than $4,125 per month might owe only a fraction of a $200 bill.

For customers who need support but do not qualify for CAP, Exelon provided another form of relief through its Customer Relief Fund, which offered direct grants to qualifying customers. Since August 2025, the $12.5 million fund has supported more than 9,000 customers in Southeastern Pennsylvania. The PECO-specific program closed after available funds were fully allocated due to strong customer demand, but according to Oliver, it succeeded in its goal “to get more protection for more people.”

That same philosophy extends beyond direct financial assistance. PECO also works to connect customers with community organizations like the United Way, which can help them apply to federally-funded programs like the Low Income Home Energy Assistance Program (LIHEAP). The company provides detailed application guidance and hosts virtual and in-person enrollment sessions for those who need support applying to energy assistance programs.

“We’re actively meeting customers where they are,” Oliver said. “We’re out in our communities talking to people and connecting them to our programs in the short term.”

Still, Oliver said, the most immediate month-to-month tool for lowering energy bills is reducing energy use by adjusting thermostats, weatherizing homes through utility-sponsored programs like the Low Income Usage Reduction Program (LIURP), and participating in energy efficiency programs that can help customers use less energy without sacrificing comfort. “The biggest saving comes from a kilowatt you don’t use,” said Oliver.

Protecting customers from future costs

While immediate resources can help customers manage their bills today, PECO’s affordability strategy also depends on protecting customers from costs that could emerge in the future, especially as new large-scale users connect to the grid.

One likely pressure point is the rise of data centers. According to Oliver, there are more than a dozen data centers in development that, once built, could require nearly as much power as PECO’s entire current customer base. Some estimates forecast that peak energy demand will increase by more than 30 gigawatts by 2030, primarily driven by data centers.

As part of the Exelon Promise, PECO is engaging large users, including data center developers, in contracts designed to ensure they pay their fair share. These agreements stipulate, among other conditions, that customers will not be responsible for grid upgrade costs if a proposed data center is never built. Instead, data centers and other large energy users would be expected to cover the costs created by their own demand. “We don’t want to make investments and then the data center doesn’t come to fruition,” Oliver said.

Pennsylvania’s energy future

The efforts above are designed to address affordability on short- and medium-term timelines — from the next monthly bill to the next few years of grid growth. But for Oliver and his team, keeping energy affordable over the long term will also require confronting the supply constraints driving up costs for customers. Because Pennsylvania utilities like PECO are currently restricted from building or owning their own power generation, they cannot directly add supply when demand rises. Instead, PECO must largely work through power generators, suppliers, and policymakers. That is why the company is also pushing for policy changes in Harrisburg that would protect consumers and give PECO more tools to respond when power supply falls short of demand.

One focus is Pennsylvania’s competitive retail power market. PECO is advocating for two recently introduced bills, HB 2131 and SB 312, that would reshape how customers are served by third-party electricity suppliers. The retail market was originally intended to lower electricity prices through competition by allowing customers to select their power supplier. In practice, however, some contracts begin at competitive introductory rates then become increasingly expensive after those rates expire. Some suppliers have also been found to use deceptive marketing practices and target vulnerable populations.

According to PECO, residential customers on competitive supply paid about 65% more in 2025 than they would have under default service. The proposed bills would return customers to PECO’s default service once their contracts with third-party suppliers end, unless a customer opts back in. The goal, Oliver said, is to prevent customers from being rolled into higher post-contract rates without fully understanding the change. “When we buy it, we buy it at the [lowest] cost, and we pass it through,” he said.

PECO is also advocating for changes to the Electricity Generation Customer Choice and Competition Act, a 1996 law that bars Pennsylvania utilities from generating power themselves. Prior to the law, Pennsylvania’s utility companies both generated and distributed electricity through vertical integration, and Pennsylvania had some of the highest energy rates in the country. It was thought that prices would come down once private companies could build power plants based on demand in the retail power market. But nearly three decades later, rising demand and insufficient supply have exposed limits to that model.

Two proposed bills, HB 1272 and SB 897, would roll back part of this restriction, allowing utilities like PECO to build or contract for energy generation if competitive markets fail to deliver enough power to the grid. “The biggest driver of bill increases in the last year and a half has been supply inadequacy,” Oliver said. “Utility-owned generation isn’t the only solution, but someone has to put a shovel in the ground to save our customers money.”

For PECO, these policy efforts are part of the same affordability strategy as bill assistance, customer outreach, and cost protections for large energy users. The goal is not only to help customers weather the current moment, but to change the conditions that are making energy more expensive in the first place.

Using every tool in the box

Even as supply costs have driven up utility bills, Oliver said PECO has worked to keep its operating costs at or below inflation. According to Exelon, that operational discipline has saved customers $580 million system-wide over the past decade.

For PECO, operational efficiency is another part of the affordability strategy set by the Exelon Promise. Immediate assistance helps more families keep their homes warm in winter and cool in summer. Agreements with new large-scale energy users can help protect customers from bearing the infrastructure costs associated with serving data center developers. And long-term policy changes could help secure the region’s energy future. “We have to be visible in all three swim lanes,” said Oliver, referring to PECO’s three-part approach. “That’s our commitment to all of our customers in the Exelon footprint and to all 2.1 million customers that we have here in southeastern Pennsylvania.”