PECO Proposes Significant Rate Hikes Amid Data Center Growth, Sparking Outrage In Montco

PECO, the utility company serving the suburban Philadelphia region, has announced a proposal for substantial rate increases, which would see electric rates jump by 12.5% and natural gas rates by 11.4% starting in 2027. This move would cost over two million families in the area an average of an additional $20.08 per month for electricity and $14.52 for natural gas, coming on the heels of a 10% rate hike implemented in early 2026. The proposed hikes have ignited strong criticism from state lawmakers, who argue that working families should not bear the financial burden of upgrading the electrical grid to support energy-intensive data centers, especially while PECO reports record profits. State Senator Katie Muth stated that PECO is "making record profits" while "asking working families to pay more" and preparing to serve "massive, energy-hungry data centers." Similarly, State Representative Joe Ciresi called the proposed increases "unacceptable" given residents' existing financial strains. A coalition of lawmakers from Montgomery County has formally petitioned the Pennsylvania Utility Commission (PUC), the regulatory body overseeing PECO, to reject these increases. The state legislature recently passed the Ratepayer Protection Bill, an initiative designed to empower the PUC to more stringently regulate data center development and avert the very kind of rate increases PECO is now proposing. PECO President and CEO David Vahos defended the proposal, stating that the investments are necessary to "strengthen the grid, reduce outages, and ensure we’re delivering the safe, reliable service" customers expect, particularly in the face of increasingly frequent severe weather and aging infrastructure. Public input hearings on the proposed rate hikes are slated for June, with a final vote by the PUC anticipated later in the year. The situation is further complicated by impending contract negotiations between PECO and its labor union, IBEW Local 614, whose workers have threatened a strike.