Environmental justice advocates gathered outside City Hall on Wednesday to celebrate a recent settlement with Philadelphia Gas Works (PGW) that brings significant reductions to previously proposed rate hikes.
The current agreement, filed in early August, is seen as a crucial step toward a cleaner energy future for Philadelphia and offers critical protections for residents against rising energy costs.
Under PGW’s original proposal, the average monthly gas bill for residents was set to increase by 13%, climbing from $92.60 to $104.61. However, the settlement reached results in a more manageable 6.6% increase, raising average bills to $98.70. This adjustment means that ratepayers will face an annual increase of approximately $62 million, which is 40% less than initially projected.
One noteworthy aspect of the negotiations was PGW’s decision to abandon a proposed revenue normalization adjustment, a measure that would have allowed the utility to account for unforeseen revenue shortfalls.
Activists criticized the proposed adjustment as a ‘revenue guarantee’ placed on vulnerable residents, while PGW officials emphasized its importance for ensuring financial stability.
Historically, a similar fee, known as the weather normalization adjustment, had affected PGW bills for over two decades, incorporating a surcharge during unusually warm weather that decreases heating demand and disrupts cash flow for the utility.
While this controversial adjustment remains in place, the settlement stipulates that it will be capped at no more than 25% of the total customer bill. Moreover, PGW has committed to reassessing its weather data and exploring the potential of using a shorter, ten-year average rather than the current twenty-year average.
To further support low-income residents, PGW has pledged to allocate $9 million for a program aimed at assisting Philadelphians in weatherizing their homes.
The city-owned utility, which manages an extensive network of 6,000 miles of gas lines and serves approximately half a million customers, first filed for the rate change in February. In response, the Pennsylvania Public Utilities Commission intervened, halting the proposed adjustments to investigate the matter further.
Advocate groups, collectively described as energy justice advocates, formally intervened in the case. These organizations include POWER Interfaith, Sierra Club Pennsylvania, Physicians for Social Responsibility Pennsylvania, Clean Air Council, Vote Solar, PennEnvironment, and PennPIRG.
Although the 271-page settlement has received approval from all involved parties, it still requires confirmation from the PUC, with a decision anticipated in November. Following that, new rates are expected to take effect shortly thereafter.
A PGW spokesperson opted not to comment on the specifics of the agreement but mentioned on the utility’s website that the settlement is designed in the best interests of both PGW and its customers, featuring enhancements aimed at benefiting low-income and residential clients.
Flora Cardoni, deputy director of PennEnvironment, hailed the development as merely a milestone in the ongoing reform process for PGW, stating that “the process for reforming PGW is a marathon and not a sprint.”
Activists have been vocal in their calls for PGW to divert investments away from gas infrastructure to focus instead on cleaner, renewable energy sources.
In a progressive move, the settlement mandates that PGW hold at least two community meetings to explore pathways for reducing greenhouse gas emissions. According to environmental organizers, this marks a groundbreaking approach to public engagement for the company.
State Rep. Chris Rabb, speaking at the rally, emphasized the significance of the efforts made by the community: “PGW needs to be on the right side of history, and I believe it will be, because of all of you coming together to make it happen.”
Rabb and his colleague Rep. Ben Waxman recognized the advocates for their persistent push for accountability from PGW and the resulting positive change.
Waxman remarked, “What we have here today is an example of organizing, of activists intervening and forcing a public institution to come to the table and make a settlement that grapples with the reality.”
This reality, he explained, is that the climate crisis is already present and evolving. He further noted that the lack of action from government at various levels makes the role of community advocacy all the more vital.
“The lesson we take away from this is to not give up, to fight back and compel our public institutions to respond adequately to the climate crisis that’s upon us.”
image source from：metrophiladelphia
