The Energy Co-op, a renewable energy provider based in Center City, expanded its service to the Lehigh Valley earlier this month. Now, in addition to serving PECO customers, the co-op can sell power to anyone in the PPL service area.
PPL serves nearly 30 counties and encompasses most of the state’s large cities outside of Philadelphia and Pittsburgh, including Harrisburg, Allentown, Lancaster and Wilkes-Barre. The expansion reflects the co-op’s goal to eventually serve the entire state.
“I really see PPL as a way to take The Energy Co-op mission state-wide,” said Clay Bedwell, director of energy operations at the co-op. He added that PPL was also chosen due to its size and proximity to the PECO service area, where the co-op already operates.
Pennsylvania residents have the right to choose their electrical provider. This allows third party providers to buy and sell electricity. Many providers market switching to them as a way to save money. Others, such as The Energy Co-op, highlight their commitment to buying from renewable energy sources such as wind turbines and solar panels.
Over 2 million people have switched from their default provider in PA, according to the Pennsylvania Utility Commission (PUC), the agency that regulates all utilities, from gas to water, in the state.
How does a third party energy provider get started, let alone expand? Bedwell explained that there are multiple stages, beginning with getting licensed by the PUC.
Once a PUC license is obtained, the provider must get set up with the utility that operates the electricity infrastructure in the territory the provider plans to serve. Utilities manage and maintain the transmission and distribution systems that are the highways and local roads of electricity transport. Third party providers must use this system to reach customers.
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Finally the provider must register with PJM Interconnection, the operator of the largest electricity market in the world, and the overall grid operator for the mid-Atlantic region. Through PJM, third party providers such as The Energy Co-op, buy and sell the energy they need to provide end-users with power.
To sum it up, there’s the regulator (PUC), the utility (PECO, PPL) and the grid operator (PJM). Getting into the energy market requires engagement with each of them through a series of tests and applications.
For its recent expansion, the co-op submitted an “expansion application” to PUC in June for its current license, which took about three months to get processed. It then submitted an application to PPL and began a series of tests, including what’s called Electronic Data Interchange (EDI) Testing.
EDI is essentially the system that providers and utilities use to communicate power usage data and billing data back and forth.”EDI is really the critical backbone of day-to-day operations between an organization like us and a utility,” Bedwell said.
This way, regardless of who their provider is, Philadelphians still get their bill from PECO. The utility transfers usage data to the provider, and the provider transfers billing data back.
Building a Base
The next steps for the co-op include expanding its customer base within PPL territory. In part, fellow co-ops will help spread the word.
“Anytime we’re doing marketing or going to new territory, we look toward the co-op network to spread the word because it’s a rather close-knit network and filled with like-minded people,” Bedwell said. “We’ve been working on doing this with co-ops in Lancaster, Allentown and Bethlehem.”
After that, the co-op has its eyes on the rest of the state.
“Beyond PPL, we are obviously still in the investigative stage with respect to other electric utility service territories in the state of Pennsylvania,” said Glenn Smith, the recently hired executive director of the co-op (profiled here).
Photo via Flickr user Wee Keat Chin-30-
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