Philadelphia households pay 11.024 cents per kilowatt-hour for default electricity supply. Allentown households pay 12.953 cents. That is a 17% difference between Pennsylvania's largest city and the heart of the Lehigh Valley, served by two different utilities, drawing from the same regional grid.
The gap is not random. It reflects how each utility purchases wholesale power, when they last filed rate cases, and how capacity costs flow through different service territories.
The rate gap by the numbers
Both cities operate under Pennsylvania's deregulated electricity market. Customers who never choose a supplier pay their utility's default rate, called the Price to Compare (PTC). Here is how that benchmark stacks up:
| Metric | Philadelphia (PECO) | Allentown (PPL Electric) |
|---|---|---|
| Current PTC (through May 31) | 11.024¢/kWh | 12.953¢/kWh |
| June 2026 PTC | 11.572¢/kWh | 13.147¢/kWh |
| Increase | +5.0% | +1.5% |
| Residential customers | ~1.7 million | ~1.4 million |
At average Pennsylvania household usage of 850 kWh per month, the supply portion of your bill looks like this:
- Philadelphia (PECO): $93.70 per month
- Allentown (PPL Electric): $110.10 per month
- Difference: $16.40 per month, or roughly $197 per year
That annual gap is real money. But it does not tell the whole story about which region's residents actually pay more or save more.
For the latest PECO rate details, see our PECO Price to Compare update. For PPL Electric, see our PPL Price to Compare update.
Why PECO and PPL rates differ
Both utilities purchase capacity and energy through PJM Interconnection, the regional grid operator that serves 65 million people across 13 states. Both are subject to the same wholesale market dynamics, including the 833% capacity auction price spike that has driven rates higher across Pennsylvania since 2024.
Yet their default rates diverge. Several factors explain the gap:
Service territory and load characteristics. PECO serves southeastern Pennsylvania, including Philadelphia and its dense suburbs. PPL Electric serves central and eastern Pennsylvania, including the Lehigh Valley, the Harrisburg area, and rural regions stretching to the New York border. Each utility's customer mix, peak demand patterns, and transmission costs differ based on geography.
Corporate structure. PECO is a subsidiary of Exelon, one of the nation's largest utility holding companies. PPL Electric is part of PPL Corporation, a smaller holding company. The parent companies' financial structures, procurement strategies, and regulatory approaches influence how costs flow through to retail rates.
Procurement strategies. Utilities purchase wholesale power through a combination of long-term contracts, short-term market purchases, and capacity obligations. The timing and structure of these purchases affects how quickly wholesale price changes flow through to retail rates. PECO and PPL do not purchase power identically.
Rate case timing. Pennsylvania utilities file rate cases with the Public Utility Commission to adjust their charges. The timing of these filings, and the specific cost allocations approved, create differences that persist between rate case cycles.
The result is that two customers using the same amount of electricity in the same state can pay meaningfully different rates simply because they live in different utility territories.
For more on how Pennsylvania's deregulated market structures these costs, see our guide to Pennsylvania electricity deregulation.
How usage patterns differ between the regions
Rate is only half the equation. Your bill equals rate times usage. Philadelphia and Lehigh Valley households use electricity differently.
Climate. The Lehigh Valley sits about 60 miles north of Philadelphia. Winters are slightly colder, with more heating degree days. Summers are similar, though Philadelphia's urban density creates more heat island effects. Both regions see meaningful seasonal swings in electricity use, but the patterns differ modestly.
Housing stock. Philadelphia's dense neighborhoods include many rowhouses with shared walls, which tend to be more energy-efficient per square foot than detached homes. The Lehigh Valley has a mix of older row homes in Allentown and Bethlehem, but also more suburban single-family homes in surrounding communities. Detached homes generally use more electricity for heating and cooling.
Household size and density. Urban Philadelphia has smaller average household sizes than suburban Lehigh Valley. Larger households use more electricity. The demographic and housing mix in each region affects aggregate usage patterns.
The practical implication: a Lehigh Valley household paying the higher rate might still have a similar total bill if their home is more energy-efficient. And a Philadelphia household with high summer air conditioning use might pay more despite the lower rate.
Average usage figures (around 850 kWh per month statewide) are just that, averages. Your actual bill depends on your actual usage.
Supplier competition by region
Pennsylvania's deregulated market means you can choose your electricity supplier regardless of which utility serves you. Both Philadelphia and the Lehigh Valley have active competitive markets:
| Metric | Philadelphia (PECO) | Allentown (PPL Electric) |
|---|---|---|
| Active supplier plans | 122 | 120 |
| Number of suppliers | 54 | 58 |
| Cheapest available rate | 9.09¢/kWh | 10.45¢/kWh |
Both markets have robust competition. Slightly more suppliers operate in PPL territory, and both offer around 120 plans. The difference is in where prices land.
The cheapest plan in PECO territory undercuts the default rate by nearly 2 cents per kWh. The cheapest plan in PPL territory undercuts its default rate by about 2.5 cents per kWh. In both cases, switching to a competitive supplier can meaningfully reduce your bill.
You can browse current plans for PECO territory and PPL Electric territory on our utility pages.
Which region's customers benefit more from switching
Here is the math that matters: how much can you save by switching from the default rate to the cheapest available plan?
Philadelphia (PECO):
- Default rate: 11.024¢/kWh
- Cheapest available: 9.09¢/kWh
- Savings: 1.93¢/kWh
- At 850 kWh/month: $16.44 per month, $197 per year
Allentown (PPL Electric):
- Default rate: 12.953¢/kWh
- Cheapest available: 10.45¢/kWh
- Savings: 2.50¢/kWh
- At 850 kWh/month: $21.28 per month, $255 per year
Lehigh Valley customers who switch save more in absolute dollars because they start from a higher default rate. The gap between the PTC and competitive rates is wider in PPL territory.
This does not mean Allentown is "better" or "worse" for electricity costs. It means that Lehigh Valley customers have more to gain from actively shopping, while Philadelphia customers start from a lower baseline.
In both regions, switching is free, takes about five minutes, and does not interrupt service. For step-by-step instructions, see our guide to switching suppliers in Pennsylvania.
What is the same across both regions
Despite the rate differences, Philadelphia and Lehigh Valley electricity customers share more than they differ:
Same wholesale market. Both utilities purchase power through PJM. The same capacity auction results, the same coal plant retirements, and the same data center demand growth affect both regions. The 833% capacity price increase has pushed rates higher in both territories.
Same legal right to switch. Pennsylvania law gives every residential customer the right to choose their electricity supplier. Your utility cannot prevent you from switching, and the process is the same regardless of whether you have PECO or PPL.
Same utility role. Your utility handles delivery regardless of your supplier choice. PECO still delivers power, maintains the grid, and responds to outages for Philadelphia customers. PPL does the same for Lehigh Valley customers. Switching suppliers only changes who supplies your electricity, not who delivers it.
Same bill structure. Both utilities send a single bill that includes supply charges (from your supplier or the default rate) and delivery charges (from the utility). The mechanics work the same way.
FAQ
Why is electricity more expensive in Allentown than Philadelphia?
Allentown's default rate is higher due to differences in how PPL Electric and PECO purchase wholesale power, their corporate structures, and rate case timing. Both utilities draw from the same PJM grid, but their procurement strategies and regulatory filings produce different retail rates.
Can I get the same supplier plan in both regions?
Many suppliers operate in both PECO and PPL territories, but rates vary by utility zone. A supplier might offer 9.5¢/kWh in Philadelphia and 11¢/kWh in Allentown for the same plan name. Always check rates for your specific ZIP code.
Do I need to do anything differently when switching in Allentown vs. Philadelphia?
No. The process is identical. Enter your ZIP code on PA Power Switch or a comparison site, compare rates against your utility's Price to Compare, and enroll online with your utility account number. The switch takes one to two billing cycles to complete in both territories.
Are bills actually higher in Allentown year-round?
Not necessarily. Allentown has higher rates, but bills depend on usage. A Lehigh Valley household that uses less electricity might pay less than a Philadelphia household with heavy air conditioning use. The rate gap is consistent; the bill gap depends on your consumption patterns.