Community price shopping for electricity proposed in Pennsylvania

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(The Center Square) – State lawmakers want to ease the burden of high electricity bills on residents and small businesses. 

While Pennsylvanians can already shop for their own electricity supplier, a new proposal would allow communities to shop on their behalf, potentially giving customers greater bargaining power and additional options to pursue competitive rates.

The proposal comes as residential electricity prices in Pennsylvania have risen sharply in recent years. According to the state’s Independent Fiscal Office, the average residential price increased nearly 46% between 2018 and 2025. 

Rep. Nathan Davidson, D-Lemoyne, recently announced plans to introduce legislation that would authorize Community Choice Aggregation, or CCA, programs in the commonwealth. 

CCA programs allow a county, municipality, or group of local governments to combine the electricity demand of participating residents and small businesses, and purchase generation from a competitive supplier on their behalf, while the existing utility continues to provide transmission and distribution service. 

Pennsylvania customers can either remain with their utility’s default generation service or choose a competitive supplier, including options available through PA Power Switch. CCA would add a collective purchasing option through local government. 

Davidson told The Center Square that the legislation’s top priorities are robust consumer protections, including extended notice periods, complete fee and rate transparency compared to utility default service, and rigorous regulatory oversight. 

The focus, he said, is primarily on an opt-out framework for standard residential and small-business accounts currently on default service, paired with an affirmative opt-in requirement and dedicated price protections for low-income households. 

“National research consistently shows that opt-in programs struggle to get off the ground simply because of administrative friction, whereas an opt-out structure builds the critical mass needed to negotiate truly competitive rates and cleaner energy options with suppliers,” Davidson said. 

At the same time, he continued, maintaining customer choice is essential.

“While initial enrollment would be automatic for eligible default-service accounts, participation remains entirely voluntary, allowing residents to decline upfront or exit at any time without fees or penalties.”

“Just as importantly, we want to ensure vulnerable households aren't exposed to unexpected rate swings. By pairing this model with an affirmative opt-in requirement and dedicated price protections for low-income residents, we can offer meaningful savings while keeping strong safeguards firmly in place.”

The opt-out model Davidson is considering has previously run into legal obstacles in Pennsylvania. Eight municipalities – Camp Hill, Carlisle, Hatboro, Lansdowne, Media, Narberth, State College, and Swarthmore – sought PUC approval to establish CCA programs using automatic enrollment, but the commission ruled that the approach conflicted with the state’s anti-slamming laws and that it lacked statutory authority to approve opt-out aggregation. 

Opt-out enrollment, however, is common in states that already authorize CCA. According to the Community Choice Energy Alliance, all 11 states with CCA authority permit an opt-out model for residential customers, although eligibility and exclusions vary by state. 

How the proposal could affect Pennsylvania’s existing competitive electricity market is another consideration.

Frank Caliva, national spokesperson for the Retail Energy Supply Association, or RESA, told The Center Square that Community Choice Aggregation, also known as municipal aggregation, gives competitive suppliers another way to reach customers. Some suppliers bid to serve municipalities through CCA programs while others market directly to individual customers through channels such as mail or online enrollment. 

Caliva said RESA has not taken a specific position on authorizing CCA programs in Pennsylvania, but its guiding principle is that any aggregation program should preserve customers’ ability to choose their own supplier based on their individual needs and preferences.

If CCA-enabling legislation allows municipalities to pursue aggregation without limiting customers’ ability to shop for their own retail supply, he said, it could complement the existing retail market. 

Suppliers that already serve CCAs in other markets could pursue municipal contracts in Pennsylvania, while others could choose to enter the CCA market or continue serving customers through their existing sales channels. 

“CCA programs could create another avenue for suppliers to compete and another option for customers, provided it preserves existing opportunities for individual customers to shop and choose their own supplier,” Caliva said.