Latest PPL Procurement Auction Points to 16% Price to Compare Increase in June 2025

PPL Electric recently concluded its February 2025 electricity supply auction, marking the final procurement round for the upcoming June-November 2025 period. With these results now available, we can analyze both the immediate impact on default service rates and broader implications for the entire PJM region.

We track supplier offers, customer shopping statistics, and utility auction progress on our PPL data page. You can also find this information for the other Pennsylvania utilities on the PA page.

How the PPL “Price to Compare” is Determined

Default Service Procurement in a Nutshell

Ever wonder how PPL determines your electricity rate? It all comes down to a series of carefully timed auctions. Twice a year - now in February and July, though it used to be April and October - PPL invites energy suppliers to bid on providing electricity to their customers. Think of it like buying in bulk, but spread out over time to avoid putting all their eggs in one basket. This strategy helps protect customers from market swings. These auction prices then become the foundation of the supply portion of PPL’s “price to compare” - the rate you see on your bill, which gets updated every June and December.

Your monthly PPL bill splits into two parts: delivery charges (set by state regulators) and supply charges. For supply, you have options - stick with PPL’s “price to compare” or choose from competitive suppliers in the market.

PPL’s strategy for securing default service power is designed with stability in mind. Rather than buying all their power at once, they spread purchases across multiple auctions throughout the year. This typically helps shield customers from market spikes, but it also means that when fundamental costs like capacity prices rise dramatically, rate increases become unavoidable.

Auction Results Explained

PPL not only staggers its purchases across multiple auctions, but also purchases the supply in a variety of term lengths. The most recent auction included three different term lengths: 20% for 2 years, 30% for 1 year, and 10% for 6 months.

Procurement Period	% for the Period	Price
June 2025 - May 2027	20%	8.704¢/kWh
June 2025 - May 2026	30%	9.077¢/kWh
June 2025 - November 2025	10%	8.997¢/kWh

The chart below shows recent auction history, going back to 2021. The stacked bars represent different auctions and show how those auction prices contribute to the total weighted average price for each service period (the blue line). The dotted red line shows PPL’s price to compare history. Now that we know the final weighted average price of 7.968¢/kWh for the June-November 2025 service period, we can estimate what the new price to compare will be in June.

Note about units: The chart below shows prices in $/MWh. For reference, $10/MWh = 1¢/kWh.

The chart above shows PPL’s procurement schedule and weighted average prices across multiple auctions.

What Makes Up the PPL “Price to Compare”

The 7.968¢/kWh auction price is the main component of the supply portion of PPL’s “price to compare”, but there are a couple of other components that get added to determine the final rate:

Transmission system costs

This component covers transmission system maintenance and upgrades and is the second largest component of the price to compare, after the auction price.

Adjustments for distribution losses

Accounting for electricity lost as heat during transmission.

Administrative costs

Expenses for managing the default service program and billing.

State taxes

Various state-level taxes applied to electricity supply.

The final price to compare is calculated by adding these components to the auction price, resulting in a total of 12.491¢/kWh for the June-November 2025 service period.

The PJM Capacity Auction Impact

We’ve already written at length about the recent PJM capacity auction results, which resulted in effective capacity prices ~4.5x higher for PPL customers than previous auctions. Some states in the region actually have it worse than Pennsylvania.

We also go into detail on the PECO price to compare page about how uncertainty surrounding future capacity costs are impacting utility procurement auctions. The same analysis surrounding the “capacity proxy price” in PECO is nearly identically applicable to PPL.

Check out the capacity write-up linked above if you’re interested in taking a deeper dive. The long and short of it is that the capacity costs increases are likely here to stay for a few years, and are impacting customers across the entire Mid-Atlantic region.

What This Means for You

For PPL Default Service Customers

• Rate Increase: Expect your electricity supply rate to increase 16% beginning June 1st, 2025
• Bill Impact: For the average household using 700 kWh monthly, this translates to approximately $12 more per month
• Future Outlook: The capacity proxy price mechanism may actually be understating future rate increases

For Electricity Shoppers

• Unlike what happened with PECO, PPL did not previously make suppliers estimate future capacity prices in the default service auction before they were known, leaving alternative suppliers in a better position to offer competitive rates
• Depending on future market conditions, customers might save money by shopping around for alternative suppliers
• You can track customer shopping trends on our PPL page. Our data shows a noticeable uptick in customer shopping the last time PPL had large rate increases.

The chart below is an example of the type of data you can find on our PPL page. It shows current supplier offers for PPL customers, arranged by contract length and price. The dotted green line represents the current PPL price to compare.

Key Takeaways

Here’s what you should know about PPL’s latest auction results:

• The PPL price to compare is increasing to 12.491¢/kWh in June 2025, up from the current 10.77¢/kWh
• The large increase in PJM capacity costs is beginning to impact consumer electricity prices
• Depending on future market conditions, you might be able to save money by shopping around for alternative suppliers

Note: The estimated bill impacts are general approximations. Your actual bill impact may vary based on your specific rate plan and electricity usage patterns.