Amtrak says PPL Electric Utilities wants to take it for a ride.
The National Railroad Passenger Corp., better known as Amtrak, has filed a formal complaint alleging that a 153 percent electric-rate increase that would apply only to the railroad is "unjust, unreasonable and unduly discriminatory."
The complaint, filed Monday with the Pennsylvania Public Utility Commission, says the rate hike would boost Amtrak's costs by $2.3 million a year. The nonprofit railroad buys electricity to power Northeast Corridor trains and its service between Philadelphia and Harrisburg.
The power dispute was triggered by an October request from the Allentown utility to increase the rate for "electric-propulsion service," which applies to only one customer: Amtrak.
On Thursday, the PUC voted to launch an investigation of the rate increase, which triggers a formal hearing process. An Amtrak spokesman declined to comment while the matter is in litigation.
In its filing, PPL says it needed to increase Amtrak's monthly customer-service charge from $126,324 to $319,671 to pay for a $24 million upgrade to a Depression-era electrical substation that serves only Amtrak. The fixed fee does not include the cost of electricity, which Amtrak buys separately from a supplier.
PPL's aging Conestoga Substation in Lancaster County takes electricity generated by Safe Harbor Water Power Corp. at a Susquehanna River hydroelectric project and converts its voltage for transmission to Amtrak's rail lines in Pennsylvania and Maryland. The power is converted by electrical transformers.
PPL owns four of Conestoga's seven transformers, which it says are more than 75 years old and "actively leaking oil and nitrogen." It says the substation's insulators are also beginning to crack. An insulator "flashover" — a high-voltage short-circuit — knocked out the dam's generators in 2014.
"The numerous equipment failures in the Conestoga Substation and their increasing frequency clearly indicate that a major overhaul of the yard is needed to provide safe and reliable power to Amtrak," PPL said in its rate filing.
Amtrak says the dispute dates back to 2015, when PPL first proposed boosting its monthly charge from $31,700 to $252,647. The two parties settled on a temporary increase of $126,324 on Jan. 1 on the condition that they negotiate terms of the substation repairs.
PPL filed for the rate increase after those negotiations collapsed.
Amtrak says that PPL has not explained how its estimated upgrade costs have increased from $15 million to $24 million in the last year, and that the utility did not consider steps to reduce the project costs. Amtrak, which already owns three transformers at the Conestoga substation, says it offered to reduce costs by supplying two more transformers to replace PPL equipment.
The railroad, which last year spent $283 million on energy and utility costs for its entire system, says it will stop paying the higher PPL fees next month. It has demanded a refund of the higher rates it has paid since Jan. 1.