PPL Electric Utilities announced on June 4, 2026, that the Pennsylvania Public Utility Commission (PUC) approved a settlement resolving the company’s distribution rate review. The decision ends roughly a decade without a base rate increase for the utility’s customers and sets new rules for how large data center loads will share infrastructure costs.
What the commission approved
PPL Electric Utilities provides electric distribution service to approximately 1.5 million customers across eastern and central Pennsylvania.
The commissioners voted 5-0, noting the partial dissents of Vice Chair Kim Barrow, Commissioner John F. Coleman and Commissioner Ralph Yanora, to adopt the recommendations of Deputy Chief Administrative Law Judge Christopher P. Pell and Administrative Law Judge Barbara Shadie Nause, as modified by a motion from Commissioner Kathryn L. Zerfuss.
PPL Electric’s original rate request sought an annual revenue increase of approximately $356.3 million. Under the settlement approved, the company’s annual revenue increase is reduced to approximately $275 million.
The PUC found the settlement to be in the public interest following a comprehensive review with a minor modification related to net metering eligibility. As part of the settlement, PPL Electric Utilities will not increase distribution base rates for two years from the effective date of the new rates. The rate increase marks PPL Electric’s first distribution base rate hike since 2016.
Bill impact by customer class
The approved settlement will raise residential customer bills by 3.23%. Following the expiration of the five-business-day withdrawal period established by the order, and if no party elects to withdraw from the settlement, PPL Electric will file a compliance tariff implementing the approved rates and related provisions for service rendered on and after July 1, 2026. All parties to the joint settlement have reaffirmed their support and do not intend to withdraw.
New tariff for large loads and data centers
A notable feature of the settlement is how it handles surging demand from data centers, an increasingly common pressure point in rate cases nationally. That broader wave of utility requests is part of the backdrop that has pushed rate-hike filings to record levels across the country.
The settlement creates a new large-load customer rate class with binding commitments of at least 10 years, helping ensure these users cover related infrastructure costs. Beginning in 2027, $11 million annually in low-income program assistance will be assigned to these large-load customers through a non-bypassable charge.
The approved settlement reflects broad, collaborative agreement among customer advocates, environmental and business interests and other stakeholders. The Environmental Defense Fund, Natural Resources Defense Council and PennFuture intervened in the case to advocate for reduction of the financial burden on Pennsylvania customers, including through use of grid-edge technologies, innovative rate designs and fair rules regarding future data centers.
Industry context and what comes next
In Michigan, Consumers Energy filed a new rate case just seven days after the MPSC approved a $276.6 million electric rate hike, which became effective May 1, 2026.
PPL Electric agreed not to raise base distribution rates for at least two years after implementation, and this is its first base rate increase since 2016.
Utilities investing in distribution hardening and grid modernization have cited rising capital costs as the main driver behind multi-hundred-million-dollar revenue requests, a trend that regulators and consumer advocates alike have flagged as a structural feature of the current investment cycle. The dynamic is also playing out in Colorado, where Xcel Energy secured a gas rate settlement earlier this year, setting the stage for a parallel electric rate case still under review.
Christine Martin, President of PPL Electric Utilities, said: “We appreciate the parties’ ongoing commitment to working constructively throughout this extensive review and for representing their constituents so effectively. As reflected in the Commission’s decision, this settlement strikes an important balance by supporting affordability for customers while enabling the critical investments needed to serve our communities safely and reliably.”
The company submitted a letter to the rate case docket (R-2025-3057164) reflecting continued support among stakeholders. Documents related to the rate case are available at the PA PUC docket page and at PPL’s newsroom.
