Your electric bill itemizes the main components of electric service: Distribution, Transmission, Transition and Generation. Each year we reconcile and adjust some of the charges on your electric bill with the approval of the Public Utility Commission.

The Generation charge is a pass-through of the cost of energy and capacity we purchase for customers who take generation service from PPL Electric Utilities. Prices for this service were established in 1998 by PPL’s Restructuring Settlement for each year through 2009.

Scheduled annual increases in the Generation charge typically are offset by reductions in Transition charges. In 2006, the scheduled changes do not offset. As a result, if you take generation service from PPL Electric Utilities you will see a net increase on your total electric bill effective January 1. We won’t know by how much until we determine changes in Transition and Transmission charges at the end of the year. We estimate that the overall bill increase will be less than 5 percent for most of our industrial and commercial customers.

Even with scheduled, phased-in increases, our generation costs remain an excellent value, especially in light of the much larger increases over the past year in the costs of other energy sources.