COMMITTE LEGISLATIVE OVERSIGHT TRANSPORTATION, May 12, 2026

COUNCIL OF THE CITY OF PHILADELPHIA Committee on Legislative Oversight and the Committee on Transportation and Public Utilities City Hall, Room 400 Philadelphia, Pennsylvania Tuesday, May 12, 2026 1:00 p.m. PRESENT: CHAIR ISIAH THOMAS VICE CHAIR RUE LANDAU COUNCILWOMAN QUETCY M. LOZADA COUNCILMAN MICHAEL DRISCOLL COUNCILMAN ANTHONY PHILLIPS Ms. Jones, The Clerk P R O C E E D I N G S CHAIR THOMAS: Good afternoon, everybody. We're ready to get started. Good afternoon, everybody. Welcome to Philadelphia City Council and the Committee on Legislative Oversight and the Committee on Transportation and Public Utilities. I now note that the hour has come. Before we get started, I just want to -- we good to go? You guys good? All right. Thank you, everybody. We're now getting ready to start with our hearing. Ms. Jones, will you please call to order of the roll to make sure that members are present.

Chair Thomas. CHAIR THOMAS: Present.

Chair Driscoll.

Present.

Sorry. Vice Chair Landau.

Present.

Vice Chair Young. Councilmember Lozada.

Present.

Councilmember Phillips.

Present.

Councilmember Squilla. Councilmember Brooks.

Present.

And Councilmember Jones. CHAIR THOMAS: Thank you. A quorum of the Committee is present, and the hearing is now called to order. This is the public hearing in the Committee on Legislative Oversight and the Committee on Transportation and Public Utilities on Resolution No. 2 250896. Ms. Jones, will you please read the title of the hearing resolution to be heard today.

Resolution No. 7 250896: Authorizing the Committee on Legislative Oversight and the Committee on Transportation and Public Utilities to hold joint hearings to investigate the rising cost of energy bills, what is driving those increases, and what the City can and can't do to address why our energy bills are so high. CHAIR THOMAS: Thank you. This is a direct -- this hearing is a direct, I guess you could say, request from constituents across, not just the City of Philadelphia, but the entire region. Folks are very, very concerned not just in the affordability crisis that we're facing but looking at the increase in costs and utility bills and just general living. And the concept of what we do moving forward is what we want to discuss today. So before we get started, I wanted to see if Chairman Driscoll wanted to be recognized for any remarks as well as any other members of the Committee before we go to the first panel. CHAIR DRISCOLL: Thank you, Chairman. Yeah. Today is an important meeting for a lot of reasons. And, you know, there's some folks in Washington that think affordability is a made-up word. Well, they don't live in the City of Philadelphia. We know it's not a made-up word. And we've been working jointly in all our policies and in particular this budget season to make sure that we recognize that the folks in this region need help. And we hope to get some insights today from you, testifiers, that we can incorporate as we go forward in our policy direction. So thank you for being here and thank you for participating, and thank you Chairman. CHAIR THOMAS: Any other members like to be recognized before we start? All right. Well, with that being said, Ms. Jones, will you please call the first panel to start our conversation today?

First, we welcome the Mayor of Camden, Mayor Victor Carstarphen. Following them, we will have Representative Fiedler and Jamie Van Nostrand. CHAIR THOMAS: Mayor Carstarphen, we'll take you first. Thank you for being here; representing the Great State of New Jersey. Rep Fiedler, I want to say thank you for being here as well, too. We'll be taking the Rep later. I want to say also thank -- say thank you for being here to Camden Vice President and Council Person of the 1st Ward, Arthur Barclay. My bad, Arthur. Councilman Barclay. Thank you, sir. Appreciate you being here. Mayor Carstarphen, again, thank you so much for being here. For those that are listening in public, today's conversation is a regional one. When you look at the increase in cost of utility bills is not a problem that is just isolated to the City of Philadelphia or even the Commonwealth of Pennsylvania. It's a -- it's a global problem; it's a national problem. But we want to try to address this issue from a regional approach, and we couldn't ask for a better partner than Mayor Carstarphen. So, Mayor Carstarphen, please state your name for the record and you may begin with your testimony.

Victor Carstarphen, Mayor of the city of Camden, New Jersey. Good afternoon. Thank you, Councilman Thomas for the today's invitation. Thank you, Council Members of Great City of Philadelphia, for having me here to talk about something so important. As has been mentioned earlier, it's not just a Philadelphia thing, it's a national issue, it's a regional issue. So just glad to be able to join this event and give my perspective on how it's affecting Camden, but also some of our approaches in dealing with the utility rising cost. And that's -- as I said, let it be clear, this is not just a Philadelphia problem; it's a Pennsylvania problem, a Camden, New Jersey. A national issue that's impacting all of us in different ways in our various communities. The city of Camden, it's an urban community similar to Philadelphia, just a lot smaller. We have a large population of seniors and other residents who are either low or restricted income. Ordinary circumstances that on a regular day for our seniors and some of our residents, it can be challenging. We're talking about residents who are living paycheck to paycheck, and count on public assistance just to get by. When rates go up, our residents are forced to choose between issues like the lights being on and meeting other basic needs. A recent statewide survey found that more than half of the voters identify energy cost as one of the most persistent financial burdens that they face. The strain is felt, especially and acutely in communities like my community, the city of Camden, where household budgets are tighter. Energy costs consume a large share of their monthly income. So, when the utility crisis -- it hits, it impacts my residents citywide. So some of the things that I'll talk about today is some ways that we're trying to relieve the pressure in the city of Camden. The pressure of this added burden that's been placed on our residents in our city. We've been fortunate enough to work in close collaborations and work well with our public and private partners on all levels of government to address issues that's concerning us today. Fortunately, that to have worked with our congressman, Congressman Donald Norcross, along with our Governor, Mikie Sherrill, and our senator within our district, Senator Cruz- Perez. and everybody is firmly committed to working lock stop to freeze or reduce utility costs in the State of New Jersey. In addition, both the city and our county are offering utility assistance to residents, you know, based on income. And some of the things I'm sure are mirrored in the City in Philadelphia and mirrored in other municipalities, the city, the county, the state. We work with our utility providers, which is PSE&G, in Camden to provide additional resources to those who qualified. Now, PSE&G has just -- they've acknowledged that New Jersey depends on imported electricity for more than 40 percent of its supply. A figure that -- that's only expected to grow. The city of Camden is uniquely positioned to advocate for local distributed energy resources, which is solar installations, battery storage, virtual power plants that reduce dependence on the regional grid and lower cost and create local jobs. In addition to that, the New Jersey Board of Public Utilities, NJBPU, recently awarded $5 million in grants to fund more than two dozen projects that will expand cooling infrastructures and reduce energy demand, and improve public health while strengthening climate resilience in the state's most heat-vulnerable communities. The awards issued through NJBPU, Urban Heat Island Mitigation Programs span 10 municipalities throughout our state. With major investments concentrated in Newark, Camden, Trenton, and additional projects in Paterson, Atlantic City, Elizabeth Roselle, Egg Harbor City, Lakewood Township, Pennsauken Township. These are municipalities across our region.

This project includes tree planting along major street corridors, conversion of public buildings into resilience hubs, shade structures, water features, community gardens, pop-up cooling phases; all designed to lower surface temperatures and cooling costs on the hottest days of the year. I've worked with our City Council to opt into a community solar initiative that we're working on. That will help some of our residents reduce utility costs, in certain cases, that could be up to 45 percent. I feel a new community solar program will help to unlock the benefits of clean and affordable energy for many of our Camden residents who might otherwise not have access to solar. We took some decisive steps last year, September 2025, to address increasing energy bills that were borne by our city residents. The city decided to participate in this community solar program, which is overseen by the NJBPU. And this program will allow certain city residents to access the benefits from solar energy without installing panels on their homes. Qualifying residents will once -- once the program is finalized, will receive a credit of no less than 13 percent of their homes' electric 14 bills. 15 We have since issued an RFP 16 to identify solar developers willing 17 to construct solar arrays within the 18 PSE&G and service territory, which 19 will generate clean energy, which 20 will be credited to certain residents in the city of Camden. Many of whom, of course, that cannot install solar panels on their homes, where residential rooftops and ground-mount solars are not remotely possible. The program aims to advance equity within the solar sector for homeowners, those who rent, live in apartments, or reside in multi-unit dwellings. The board's regulations calls for municipal community solar projects to serve a minimum of 80 percent low- and moderate-income subscribers. The board also is ensured that community solar subscribers will be guaranteed a minimum discount of no less than percent 16 of the utility bill, which will 17 apply for the duration of their 18 customer's subscription. 19 Now, all these programs, 20 and I'm mentioning right now, it's a huge start, you know, of trying to bridge the gap, of the discrepancy of the costs that are hitting my community, your community, and all over. But Camden, we need to sustain permanent assistance infrastructure. You know, we have LIHEAP, USF, REACT, must -- they must actively be promoted in our communities where we have language barriers, lack of digital access that prevent residents from enrolling. And I -- I've always talked about the power of information and the power of messaging to our community because we have all the programs in the world. And if our -- if our community and our -- we're not breaking through language barriers, and we're not getting to Ms. Williams' house with information, we rely on social media so much, I think half -- that's half the battle. And my colleagues, my staff, will tell you, you know, there's funding out there. We got to get it out to our -- we got to meet our people where they're at, so they understand that this is available. Camden has committed to modernize our infrastructure. We've been working really hard. I'm talking water, sewer, electrical infrastructure. Millions of dollars has been invested in updating new LED streetlights, updating water wells, water lines, gas lines, and gas meters. Both existing and new developments have implemented increased solar elements, in some cases, solar parking canopies. And our city code also supports green and sustainable building practices or build to LEED- certified requirements. While we don't have a singular solution, you know -- the -- you know, coming together in hearings like this and working together with all levels of government to advance legislation and advocate together on critical funding and making investments and new and efficient infrastructure while enhancing open spaces that we have.

Committing to strategic plannings and restoring the urban tree canopy and building strong environmental partnerships. All of this helps. While I feel these initiatives are a part of a larger effort to keep costs down, as I'm sure you'll hear everyone testifying on, you know, their scenarios. While -- will these large efforts result in immediate decrease on individuals that are paying everyday bills? No, they won't. But in my community, this will require a serious conversation with organizations who regulate utilities, BPU and utility providers. This is a conversation that has to reach them. Through these types of discussions, these forums, we have opportunity to think bigger, not just utility bills; this conversation is about fairness, you know, economic opportunity, public health, and the future of all of our communities. So energy affordability should not be a privilege. It should be a basic expectation for every family. As Camden and this region continues to grow, we have to ensure that the growth lowers cost of our residents and not increases the burden. Again, thank you for allowing me to just bring a little slice of what's happening in the city, what's going on in the State of New Jersey, and how the legislators are trying to work together to continue -- to continue to bridge the gap and costs that are continually rising up. So we can work collectively, and then I can do anything on my side of the bridge; you know, Councilman Thomas knows I'm a phone call away. Thank you. CHAIR THOMAS: Thank you. Thank you, Mayor Carstarphen. We appreciate it. What we want to do, if it's okay with members of the Committee, I want to allow State Rep Fiedler to provide the State Rep's testimony. And then if it's okay with you, Mayor Carstarphen, and we know members of your team are here, we're hoping that a few members of your team can take some questions along with the State Rep dealing with energy costs outside of Philadelphia. Is that okay with everybody on the panel? COUNCILMEMBERS: Yes. CHAIR THOMAS: Rep, you want to come on up, please?

Good afternoon. CHAIR THOMAS: You may state your name for the record, and you may begin with your testimony.

Good afternoon, Chairs Driscoll and Thomas and members of City Council. Thank you for the opportunity to speak today. I am State Representative Elizabeth Fiedler, representing the 184th Legislative District in South Philadelphia. I now have the pleasure of chairing the House Energy Committee, where we're working very hard to understand and address the issues that you are hearing about today. I want to begin with the reality facing too many Philadelphians, one that you know as well as I do. Energy bills are rising faster than household incomes, and people simply don't have the money to pay. Affordability, the struggle to survive, it's not new for a lot of working people, but it is even harder than it's ever been. Seniors on fixed income come into my office in South Philadelphia talking about the impossible choices they are making. Should they pay for heat, or should they pay for medicine? Parents come in talking about things that they're doing without, so they can afford to pay their bills and get their kids the things they need and buy groceries. I'm grateful to City Council for holding this hearing today and for inviting me to share a little bit about the work we are doing on the state level. I do want to emphasize that this is a moment of real pain for a lot of people. I have the chance to speak with these people often in my district office, and I know you all do in your districts as well. This is truly a difficult moment for our city and for our country, and I am grateful to you all for coming to this hearing with open minds and hearing from so many folks who have ideas of things we can do to help our neighbors. Let me speak briefly about why I believe electricity and gas bills are going up. That's one of the most common questions I get, especially in my new position as the Energy Chair. We've held hearings and had dozens and dozens, hundreds of meetings on the topic. Demand on our regional grid is rising due to extreme weather, greater electrification, artificial intelligence, video conferencing that we all use, all sorts of technology, and the growth of data centers. At the same time, bringing new energy supply online, whether it's gas, renewable energy, nuclear or transmission infrastructure faces long delays and high costs. Simply put, when demand rises faster than supply, prices go up. And our neighbors are feeling it right now. Just as importantly, Pennsylvania's regulatory structure allows utilities to reliably recover costs and earn guaranteed profits even when some of those delays and inefficiencies are contributing to difficult cost burdens. Residential consumers bear the risk while some of these utility companies are being insulated from bearing risks as well. I want to emphasize that rising bills are difficult; they're painful. But they are not inevitable. They're the result of choices, policy choices, regulatory choices, and market choices. And as a state elected official, I look forward to continuing to work with you all, my city counterparts, to do everything we can. Always keeping in mind those folks who come into our district offices, who are faced with this reality every day. At the federal level, recent decisions by the Trump administration have stalled investments that could have lowered energy costs, could have strengthened our grid, and could have made this problem a little less bad. The key of -- the rollback of key provisions of the Inflation Reduction Act, in particular, halted so many projects that could have put people to work, improved reliability, expanded clean energy, and reduced bills for families and small businesses. It makes me sad to think about what we lost because that was pulled back. In addition, of course, there's global instability; tariffs and war that have pushed up fuel prices, pushed up heating costs, and wholesale electricity rates.

Only Washington has the financial capacity, the big borrowing power, and the national reach to build the scale of energy infrastructure we really need. But I believe the city and the state can do important -- incredibly important and useful work for our neighbors. There are things we can do to lower bills. We are in an energy crisis, and I believe it's only going to get worse if we do not act. That said, let me get to a few ideas. This session, the House Energy Committee has advanced 15 Bills related to energy generation, efficiency data center oversight, working closely with our partners in the Consumer Protection Technology and Utilities Committee and the House Finance Committee. They got long committee names, I just got Energy. Working closely with the -- with Chairman Burgos and Chairman Samuelson of both of those committees. One significant Bill we've gotten through is House Bill 1834, the Data Center Act from my colleague, Representative Rob Matzie. This legislation would give the Public Utility Commission regulatory authority over data centers, prevent utilities from shifting data center related costs onto residents and small business customers, require data centers to contribute to the LIHEAP and other assistance programs our neighbors count on, encourage renewable investment here in Pennsylvania, and promote onsite energy generation by those data centers. House Bill 1834 recognizes that utilities have an obligation to serve all customers, including large industrial loads. But it also emphasizes that the folks who live in those spaces right now should not be expected to pay more simply because they have a new neighbor. A second important Bill is called Advanced Transmission Technologies, ATTs. House -- it's called -- it's House Bill 8 -- House Bill 2223. And it passed the house unanimously. I know, thank you. We still have to get it through the Senate, so maybe I'll wait on the applause, but I do appreciate it. And we worked very hard. Advanced Transmission Technologies are modern tools, hardware and software upgrades that can increase the capacity and reliability of our existing transmission lines. It's a simple concept, but it will help us to save a lot of money. We will avoid costly new construction and be able to transmit more energy with less energy lost in the process. Another bill, House Bill 9 2264 from Representative Davidson, would establish what are known as Virtual Power Plant Programs. This concept, with the name, took me a minute; it is not exactly a power plant in your home, but it's a similar idea. These programs use existing technologies that many residents have: rooftops, solar, home batteries, smart thermostats, to reduce peak demand. That means fewer expensive upgrades and lower bills. While participants in these VPP Programs can earn money for the services their equipment provides, basically turning their heat down just a little bit during peak times to make sure the grid is reliable for everybody. I do want to talk just a little bit about new sources of energy that we are working to get online. One comes from Representative Arvind Venkat from Allegheny County. It's House Bill 11 2076, and it would create a regulatory framework for geothermal development. A lot of people don't think about geothermal as a useful source of energy here in Pennsylvania, but it is, and it can be even more. This legislation enables Pennsylvania to tap into a clean, constant resource. There's also Representative Jose Giral's House Bill 2017, which removes unnecessary barriers to new nuclear technologies, allowing safer advanced reactors to be built in our state. And we have legislation to reduce barriers to the construction of distributed solar and storage projects, as you were hearing about from the Mayor of Camden.

I believe that the growth of the solar industry here in Pennsylvania and certainly in Philadelphia prevents a -- presents us with a tremendous opportunity to get more energy online quickly, create good paying jobs here in Philadelphia, and ideally to keep people's bills down. I do want to add that we are also taking a hard look at utility profits. 5 percent rate increase, which the governor himself described as, “pure greed”, was withdrawn after significant public pressure. But the episode highlighted the need for deeper reform. That's why I am working with my colleague, the Chair of the Consumer Committee, Chair Burgos, on House Bill 2224, which would establish new standards for determining utility profit levels, ensuring investors earn fair but not excessive returns. This is a big step. It is a challenging piece of legislation, but yet again, I am guided by the people who come into my district office already having trouble paying their bills and making very difficult decisions right now. The last Bill I want to mention is House Bill 2131, which I'm working on with my colleague, Representative Heather Boyd. This legislation reforms Pennsylvania's retail electricity market. If you're not familiar with that -- with that language, it's the folks who come to your door knocking and asking if you want to change your supplier. Too many consumers that shop for electricity are unknowingly re-erolled -- re-enrolled into high- cost variable rate plans. This Bill would curb predatory practices and better protect consumers, our neighbors and constituents, from price gouging. And of course, there are Solar for Schools. A piece of legislation that I was proud to champion and to celebrate here in Council Chambers. We continue to work with the School District of Philadelphia, as well as school districts across the Commonwealth to apply for the $25 million that is available from the state, to help them put up solar panels on their buildings and on their grounds. All with the goal of saving School Districts and taxpayers' money. As you all consider next steps, things that you can do on the municipal level, I hope that you'll -- I hope that these thoughts may be helpful to you. Given that the city owns both the Philadelphia Gas Works and the Philadelphia Water Department, that ownership gives the city unique responsibility and authority to protect our residents. I urge the city to look at strengthening consumer protections to the best of your ability, improving billing practices, and ensuring that shutoff policies prioritize health and safety, which I know are important to all of us as elected officials. Second, I encourage you to look for ways to invest more aggressively in weatherization. For residents living in older housing stock, weatherization is one of the most effective ways to reduce energy burdens. Given some of the folks in the audience today who will be speaking, I'm quite sure you will hear from more experts about how every dollar spent on insulation, air sealing, and efficient heating systems lowers monthly bills, not just one year, but for years to come. Finally, I would like to thank Councilmember O'Rourke for some of the work that he is doing on this issue. Philadelphia has clear authority over building codes and landlord tenant law. Stronger efficiency standards for new construction, better insulation, modern HVAC systems, higher performance windows can significantly cut long-term energy waste. And at the same time, the city can hold landlords accountable for keeping rental units in good repair, ensuring tenants are not paying inflated bills caused by drafty windows or broken heating systems. And the city can strengthen oversight of sub-metering to ensure billing is fair, transparent, and not used to exploit tenants. I remember not that long ago as a tenant myself, and when I read over Councilmember O'Rourke's legislation, I found myself nodding and saying, “We should do that. We should do that.

” Thank you, Councilmember O'Rourke, for your work and for being here. And finally, shout out to the Philadelphia Energy Authority. Our city truly has a powerful asset in GEM and PEA. PEA has already demonstrated the ability to scale up rooftop solar distributed generation, and energy efficiency programs. I would like to suggest the possibility of more funding so that PEA can expand its work to reduce -- to reduce energy costs for Philadelphians. In short, while Washington and Harrisburg must act, and I will do my best, Philadelphia holds great power. I am grateful to all of you for your focus on these issues and for caring as I do about all of our neighbors in Philadelphia. Thank you, and I'm glad to answer any questions. CHAIR THOMAS: Thank you for your testimony. Thank you both for your amazing testimonies. Always great for us to hear perspective outside of local government. I want to take a moment if you are okay, Rep, just to ask a few questions to you as well as some of the representation from New Jersey as well. C. not necessarily being an option anymore. ” Those projects that you spoke of, can you just elaborate a little bit about some of those renewable projects being canceled. And just in your opinion, I know that you're not like the technical expert, but you're a legislative expert. Do you think that those renewable projects being canceled has a direct correlation to the increase in utility bills that folks in Philadelphia and other places are seeing?

Sure. Thank you for the question. So when we talk about the changes that have happened at the federal level, there are many. And, in some cases, project have been -- projects have been pulled completely, they've been slowed down. And in other cases, there's just been a massive level of confusion and uncertainty. And for anyone who has ever been a developer of any project, having uncertainty about whether you can acquire the materials that you need, in the time that you need, is not a good thing. So in particular, I could talk -- you know, I mentioned Solar for Schools. One of the tax credits that was available was scaled back rapidly. So the dates were pulled back pretty significantly in a way that makes it very hard for schools to be able to qualify for the federal reimbursement that they would've received for solar panels. So in many cases, like for that, it's not a program that's been completely eliminated, but it has made the timelines much more challenging. Restrictions have been put in place on where items can be procured. And I think we are still in the process of trying to build out American manufacturing in a way that recognizes that it would be ideal for us not to be reliant on having some of these goods sourced from other countries, to make sure that they're built here in the United States. There are still -- you know, there's solar panels that are built in Canada and other countries, but if we could have a very robust system in place here in the U.S., that would certainly go a long way to getting a lot of these projects online. That's one of the other things that we're working on with the finance committee as a clean manufacturing tax credit, which would be added to the existing edge tax credit. And it would incentivize the production of things like heat pumps here in America to make sure that we are building them here so that we don't come into -- you know, have challenges in the future when it comes to, for example, tariffs, which can really throw a lot of development into tailspin. CHAIR THOMAS: Thank you. For anybody on the panel, one of the things that both folks -- both elected officials who testified, essentially talked about, was the importance of producing more energy. And, Rep Fiedler, you gave some examples. Mayor Carstarphen, you gave a few examples as well, too. If anybody could, could you just elaborate on the idea of producing more energy and anything that you feel like, not only the legislation that was communicated, but other ideas that's on the horizon that can put us in a position that can help just more energy for the region. I think one of the things I heard someone say is just the idea that the supply of far as what we want as it relates to using energy, it doesn't match the demand. At least not what it used to. The demand has increased significantly, and the supply has not increased in the same capacity that the demand has. So any thoughts on that? Any communication folks who want to add to the dialogue, we would definitely appreciate it.

It's a great question. Thank you, Councilman. I think that -- and again, you'll hear I know later today from some folks who are experts in -- certainly in the renewables field. I think renewables play a key role in our energy right now and can play even more. They are relatively cheap to get online, relatively quick. And they are things that can go up really fast and suddenly be connected to the grid and be generating energy. So I think the more that we can do to try to get renewable energy projects like solar, but I also mentioned geothermal. You know, obviously hydro and wind are options as well, even though they in part have been subject to some of the pullback of these federal incentives. The role of renewables to me feels like a place where we really should be doing absolutely everything we can in and for Philadelphia. That said, I do think, you know, we can't overlook the need for base load energy and the fact that, you know, when there was that cold snap, which now feels like a distant memory, and it was -- CHAIR THOMAS: Sure did.

-- really, really cold -- CHAIR THOMAS: Yep.

-- everybody turned up their thermostats, right? We all needed to be warm. So we need to have a -- sort of a diverse portfolio of energy to make sure that all of our needs are met. But I don't think that means we overlook any of them. We just recognize that it's a mix and it's something that we all have come to expect. You know, everybody expects when they turn up their heat just a few more degrees, that it'll get warmer. And so I think it is going to take a pretty thoughtful approach from a lot of people, and that's where the VPPs legislation comes in. I think that gets back to the idea of energy efficiency and how can we all use a little bit less energy for the good of everybody else. CHAIR THOMAS: Want to state your name for the record?

Sure. CHAIR THOMAS: You can respond with anything you want to add.

Good afternoon, Chairs and to the members of the Council. My name is Timothy J. Cunningham. I'm the city administrator in the city of Camden. Having the privilege to work for Mayor Carstarphen. Building off the Representative's comments, in the renewable space, Mayor Carstarphen testified about the community solar program that the city is advancing, and that's through our New Jersey Board of Public Utilities. We are very lucky in New Jersey to have a governor that understands that additional generation is in fact needed to reduce energy burdens. To that end, the community solar, again as the mayor testified, will allow Camden City residents to benefit from solar arrays even when they don't have the capacity to put solar on their properties. We have a very diverse city, both in terms of our population and our ethnicity, our -- the income of our people and our -- and our properties. And many of those properties are smaller rental row homes. And because of that, the way the community solar program works through our New Jersey Board of Public Utilities, is that the city of Camden as a participant, is allowing our residents to receive a benefit on their utility bill, a direct benefit by issuing an RFP. The city issues an RFP for the construction of solar. That solar can occur anywhere in our utilities geographic area. And Public Service Electric and Gas is a very large regional supplier in New Jersey. So we issue an RFP and developers can build solar anywhere there. And as a participant in that BPU program, a certain portion of that solar generation is credited to the mayor and the councilmen's constituents. In addition, I agree with the Representative that not being too dependent on one particular type of energy is important. And in the city of Camden, the mayor has supported the gas side of PSE&G as we work, and it's a very disruptive process, to replace older gas mains and service lines. Until additional renewables and other opportunities come online, we need to make sure that our residents maintain access to clean and reliable power or at least reliable power including gas. And many of our older homes and mayor in the -- in the Fairview section of Camden, which was, you know, at one point, you know, the shipyards, they're very small homes and it's one of the oldest gas maps in the state of New Jersey. So at least upgrading that to make it as efficient as possible, to make it as safe as possible, and to make sure that homes have access to that is extraordinarily important. So, Chair, that's what I would offer on the generation side. CHAIR THOMAS: Yeah. I -- just one question before we close out. So as we begin to do a deeper dive into this issue, and today's conversation is just the beginning. Myself and my colleague, we're really committed to this issue because we understand it's a big problem for the constituents in the city of Philadelphia. The idea of producing new energy, listening to everybody, that is a big part of the solution. And as we begin to produce new energy, it impacts everybody in the entire region. So we want to attack this as it relates to looking at it through the lens of the entire tri-state area, right? We don't see it as just a Philadelphia problem. I'm glad that folks from Jersey are here saying that they don't see it as just as a New Jersey problem. And so, what we want to do is create the idea of a coalition that comes together to figure out what do we do to lower the cost for the entire region. In the midst of doing that, there's been a big cry as it relates to issues around not just producing energy, but what makes the energy cost go up. I heard a number of people talk about data centers. I heard folks talk about AI and different technology that's being used now that's like really putting people in a position to increase the average person's -- the average person's electric costs.

And so based on looking at where we are right now, looking at the fact that Philadelphia City Council wants to attack this as a regional problem. C. as it relates to not the climate that we're in right now, because that -- there's a lot of uncertainty right there. But, Rep Fielder, and the -- and this is my last question, I promise. C. have really put us in a position to have to act on our own. C. While being state and local elected officials, we know we have the limitations that we have. But we understand that it's a tri-state problem and it's in a regional problem. C. C. for some of the solutions that I heard communicated today. It's -- it is going to have to be us who attack this problem, at least for the next couple of years. And I know constituents in Philadelphia, they're not really trying to hear, wait until an election for your utility bills to go down. , but what can we expect moving forward throughout the course of our regional dialogue?

I think it's wise to take the regional approach, especially given that we're in PJM. I know you'll hear from those folks shortly. We -- CHAIR THOMAS: So let me rephrase that because you brought up PJM. Let me just -- and I'm sorry, Rep, and, you know, I got love for you. So PJM, for example, was founded about 100 years ago, right? I believe the year was like 1927. And don't think that I'm like an energy expert; we just prepared very well for the hearing. And so thinking about the fact that PJM was created about 100 years ago as a outcry to the conditions that we were facing to provide some type of regulation, do you think we need to have that type of conversation again? Should there be instead of a -- just a conversation around just PJM and looking at it from the perspective of individual states and individual commonwealths. Do you think that it is worth us revisiting what we did 100 years ago to have a different conversation around regulations, around energy, around energy costs, around what we do for consumers, and around the profit margins dealing with energy? So I guess that's a better way to phrase the question. And I would love to hear your thoughts as we close out this panel.

I'll respond with, yes, I think that would be a good idea. Taking a -- taking another look at it, right? We talk in Harrisburg also a lot about our tax system, which was put in place about a century ago. Things have changed in 100 years, right? Technology exists, new sources of energy. And so yes, I think it would be wise to take another look at whether this makes sense. I do think in the absence of PJM, in a hypothetical absence, something else would have to be built. And I don't think that that is a small task at all. The governor has certainly worked with his counterparts within the region to also talk about the challenges and potential strains presented by membership and PJM. But I do think a conversation is a good idea. I'm working with counterparts on the state level across that same region to see what we could do in a collective fashion to protect all of our neighbors from rising costs. So, yes, I think that kind of conversation is very -- is overdue and would be very useful across state lines. And I do think that the affordability -- whether you call it the affordability crisis or the energy crisis or just like a crisis, it's hitting everyone. It's hitting everyone in all these states: our counterparts in other states and in other cities. And I know that elected officials on the federal level in D.C. are also taking, kind of, a second look at whether some of the pullback on some of these tax credits make sense given that we're in an energy crisis. So it is quite possible that we will see change, you know, a 180, a 360, whatever it is, on the federal level. But you're right, people can't wait until the next election or until an elected official in D.C. or anywhere else changes their mind. So I think those sorts of conversations are very useful. And I do think that there are ways to lower people's energy bills. I -- that to me feels incredibly important, because a lot of folks feel like the prices are out of control and are losing hope because they're struggling so much to keep up. So I'm grateful to all of you for being willing to do that work. CHAIR THOMAS: Well, thank you. Thank you for your advocacy. I don't know if you guys want to add anything, but again, just please be on the lookout, right? We -- again, 100 years ago, this conversation started and this is how we got some of the regulations that's in place right now. And any idea that's 100 years old, probably needs to at least be revisited to see if it still fits today's time. So that's one of the things that we want to continue to discuss as it relates to today's dialogue. I want to say thank you to everybody on this panel for being here. We respect you as elected officials. Thank you for the work you do as public servants and the people that you represent. And you spent a hour of your time, some of you even more with your time with us today, and we truly appreciate that. So thank you. Can we giving them a round of applause? All right. The clerk is going to call the next panel, but I'm going to take the liberty as the Chair to modify the panel that's coming up. So I'm going to add -- matter of fact, Madam Clerk, do you have all the names for this panel? All right. Go ahead. You can call up the next panel.

Next we will hear from the former Chair of the Massachusetts Department of Utilities and current Senior Fellow at Kleinman Center for Energy Policy at the University of Pennsylvania. And Ashley Coles, a CLS client. CHAIR THOMAS: All right. We -- who -- we should --

We'll also be hearing from the director of the Philadelphia Office of Sustainability, Elizabeth Lankenau. CHAIR THOMAS: All right. So for this panel, if it's okay, and for -- and I also want to -- Yeah. Okay. Yeah. So I just wanted to make sure we had somebody from the admin here. Thank you for your patience. We appreciate you. If you guys are okay, can we allow Ashley to testify first just because she have time restriction. And then after Ashley, we'll allow the rest of the panel to provide their testimony and then we'll open it up for questions. Please state your name for the record.

Good afternoon. My name is Ashley Coles. And so I am reaching out because I do have, like, some disagreements with the PECO. So once again -- sorry. Good afternoon to the Councilman Thomas, Councilman Driscoll, and the members of the Joint Committee of the Legislation Oversight and the Transportation and Public. So one -- once again, I am -- my name is Ashley Coles, and I am here today to explain how hard it is when it comes to my utilities. So I am a single mama too. I live in the North Philadelphia area. I've been living at this house for close to three years now. All my PECO bills and everything been fine, but then now every single month is like at risk of being shut off. I have a and 11 a six-year-old. So like every 12 month -- I'm very independent, so I 13 was fine to try to pay and get on a 14 payment arrangement, but it was very 15 confusing because they did a payment 16 arrangement on a back bill and not a current bill that's coming in. So I've been working since I was 14. I tried to keep everything on control, but once -- pretty much after 18. And I had -- 2024 I had -- 2019, I'm sorry, I'm getting a little nervous. But 2019 I was diagnosed with epilepsy. So -- but I still was working as hard as I can. But at the end of December of 2024, I had to physically stop because my epilepsy did get out of control. So I tried to get that under control, but as of right now, I still can't work. So I am on disability. Now, the thing that comes with the PECO is that the bill is extremely high, more than $700 like each month. Now, many times I always do, for some reason it came in 1,000. But I always try to, you know, save my energy and to actually try to pay it off. Now, I keep my thermostat on 70, so I don't want no heat or no 19 air because the house is all central. So that's -- my mom told me that way to try to keep little sheets and stuff under the window seals, under the doorways just to keep the air and stuff out. And then when it's hot out, I don't cut my system on at all. I still just use the fans to just try to keep everything under control. But evidently it is not. So I was on -- I never received LIHEAP until this month when CLS had helped me. LIHEAP always declined me stating that I was -- my bill was way over 5,000. So they couldn't help because they maxed out at 3000 cap. Every time they put me on the cap, the cap -- well, it would hit my account and then it would immediately be capped out stating that it already hit the -- reached the limit. Now, every time I try to call PECO to try to get an understanding of the bill, they never give me a good understanding. I asked for a payment arrangement, but my payment arrangement was for me to manage my main bill that's coming in. They made a payment arrangement for a back bill. So all the money that I put into the account goes to the back bill and not my current bill. So every month I will receive a 10-day shut off notice because they constantly keep saying my current bill is not being paid. So when I put the $700 in every month, because that's how much the bill come, they says that goes to the back bill and not the current bill. So as of right now, I had asked my doctor to get a sign off paper to try to put a hold on it for 30 days. So they did that, but then they still not giving me an explanation as in what's going to go on with the next bill. They just say, it is what it is, that I have to pay for the energy, if not get it shut off. It was shut off in a point in time and I had to -- they said the minimum I could pay is $300 to get it cut back on. But the additional $400 had to be paid by the next following week to try to clear a monthly bill. Other than that, they not giving me no explanations. Every time I call, I get hang up on. Now, I had one little concern while I was actually mad with the PECO because I am on Section 8.

” You -- I'm getting, he's pretty much saying, oh, well, I'm getting free rent from Section 8, so you telling me that you can't use your utility bill paid. But I'm like, well, I'm on disability, I only receive 1,300 a month and it's impossible to try to choose $800 on a utility bill and then still try to figure out the next three weeks for my two children. So they pretty much -- I just asked to speak to a supervisor, but they quickly just hang up, which is all the time. So other than that, as of right now, when PECO came out to try to resolve a problem, they said, yeah, your house is very drafty and whatever. They don't know how -- what's going on with the AC system. ” But other than that, no, nothing. And that's about it. I'm just -- pretty much I'm trying to speak on PECO, which I really don't like, but PECO is the main one that's always constantly giving me problems. Before it wasn't ever like this. But since I moved into this house, that's all AC, all central air. It's just been hectic, just been hectic. They never can explain what's the usage of my bill. I keep my thermos -- I keep the system off because every time they try to explain it, they don't explain it. So the bill will come in like 7-, $800 a month, and then they still just telling me to pay for the back bill. So as of right now, the bill will stay 5,000 because I put the $700 on thinking I'm paying May 5th, but no, they put it to the back bill and saying my monthly bills is still not going to be paid. Unless the back bill is completely paid off, and then I can get a regular monthly bill and get on a payment arrangement with a monthly bill. Other than that, contacting PECO is never no help and that's the only thing that they does. And I'm about to say PECO, light, heat and everything, nothing. That's about it. CHAIR DRISCOLL: Well, thank you for your testimony. I don't know who would like to go next.

Jamie Van Nostrand next, if you would.

Thanks, Dave. CHAIR DRISCOLL: And state your name for the record and proceed with your testimony.

Yes. I'm James Van Nostrand, V-A-N N-O-S-T-R-A-N-D. Good afternoon. I'm Jamie Van Nostrand, senior fellow with the Kleinman Center for Energy Policy at the University of Pennsylvania. The views I express today are my own and do not reflect the institutional position of the Kleinman Center or the University of Pennsylvania. As a relatively new resident of my new now favorite city, Philadelphia, I moved here last May. I'm happy to share my thoughts on energy affordability this afternoon with the Committees on Legislative Oversight and Transportation and Public Utilities. I appear before these committees with over 45 years of experience in the energy industry, including a recent two-and-a-half-year stint as Chair of the Massachusetts Department of Public Utilities in Boston. Since November, I have been working as the policy director at the Future of Heat Initiative, which is a national nonprofit working on energy affordability issues with the focus on the effective regulation of natural gas distribution companies. Prior to my tour of duty as a utility regulator in Massachusetts, I spent years as an energy environmental law professor, three years running an environmental NGO in New York, and over years 6 representing investor-owned 7 utilities and rate proceedings in 8 the Pacific Northwest. 9 The urgent need to address 10 energy affordability is a national 11 issue that extends far beyond 12 Philadelphia. According to a report issued two weeks ago by RMI, average residential electric bills have outpaced inflation in 41 states over the past two years. This follows more than a decade of household electricity bills growing with or slower than the rate of inflation. PowerLines, a national nonprofit focusing on energy effective utility regulation and affordability, reports that rate increases are surging nationally with requests reaching a record $31 billion in 2025. More than double the $15 billion in 2024 impacting 81 million Americans. Residential electricity rates across the country have risen roughly 40 percent since 2021. Energy affordability has received even greater attention in the Mid-Atlantic region, in which Philadelphia is located, due in large part to the forecasted load growth attributable to new data centers in the region, primarily to meet additional requirements related to AI and the impact of that anticipated low growth on capacity prices in the PJM wholesale market. S. S. S. 3 electricity by 2028. 4 And it is not just data 5 centers driving this load growth. S. electricity demand is 9 experiencing unprecedented surge and 10 is predicted to grow by 25 percent 11 by 2030 and up to 78 percent by 2050 12 compared to 2023. Due to manufacturing expansion, increased electrification, as consumers take advantage of more efficient electric heat pumps and electric vehicles to avoid high natural gas prices. In response to this anticipated load growth, electric utilities are planning massive investments in transmission and distribution, T&D infrastructure, to deliver more and more electrons to consumers and to harden the grid in response to the increasing frequency of extreme weather events. S. 4 trillion in capital expenditures, CapEx, through 2030, marking a percent increase in 9 planned investments in T&D 10 infrastructure. Under cost of 11 service regulation in place 12 throughout the United States, this 13 increased investment will create 14 significant upward pressure on 15 electricity rates going forward as 16 utilities earn their profits on this 17 capital spending. 18 And in this regard, I note 19 the testimony of Representative 20 Fiedler and the work that she's 21 doing in the Pennsylvania legislature on rate reform, particularly HB 2224, which is looking at how utilities set their ROEs. You know, Governor Shapiro issued an -- a letter last April 29th, just a couple weeks ago, in terms of how utilities set their ROE.

As a former regulator, I think in response to the question that Chair Thomas had in terms of this business model. You know, when states passed the statutes that regulates investor-owned utilities, those -- there was a -- for the most part were passed in 1907. We're talking 120 years ago, is when the rate of return, the regulatory -- utility regulatory statutes were passed. Originally in Wisconsin and New York, and then within a few years thereafter about half the states in the country. So I think it is -- it's long overdue, I think, to have that look one at the utility business model itself. And there was a reference by the mayor to Governor Sherrill in New Jersey. I testified last Friday or last Thursday up in Trenton. The BPU convened a workshop on looking at the utility business model. And basically, is there a -- is there a better way to set rates? I think there's a consensus that the way we've been doing it, it might have worked fine in a -- in a -- in a period of relatively low load growth. But these -- this statutes been put in place for 120 years ago. And maybe it's time to figure out is this -- is the cost-of-service formal regulation really working? And I think Governor Shapiro's letter really -- and I think the legislation that Representative Fiedler is working on in terms of how we -- how we estimate the utilities profit, necessary profit level, it's also worth reconsidering. It's not just bills on the electric side that are increasing, it's also the natural gas bills on which I focus in my current work at the Future of Heat Initiative. CHAIR THOMAS: Sir, can you do me a favor? Can you just move that mic over just a little bit?

Sure. Yeah. Nationally, the delivery portion of the typical gas bill has doubled over the past years, increasing 14 it more than twice the rate of 15 inflation. Even though residential customers on average are using 21 percent less gas, the average natural gas bill is up by 33 percent. Gas customers now pay roughly twice as much to have the gas delivered than for the gas itself. In Pennsylvania, the gas utilities are investing billions to excavate and replace old pipes and install new infrastructure. 6 billion over the last 6 years. 7 This continued spending to 8 maintain the gas distribution system 9 ultimately will lead to significant 10 future rate increases as sales volumes continue to decline due to the inevitable transition to electric heat pumps, which are more efficient and a more cost-effective heating solution for utility customers. Apart from the rate increases driven by infrastructure spending by the electric and gas utilities, there is the cost of the energy commodity itself. Whether energy remains affordable is largely a function of national energy policies. And on this point, it is largely an issue of supply and demand. As noted above, future demand is expected to soar. The question is what actions the federal government has taken to bring a new generation online to help meet that expanded demand? It is fair to say that the Trump administration over the past months, has taken every available 11 action, both legal and illegal, to 12 slash new energy supplies by 13 crippling the development of the 14 cheapest new sources of energy; 15 wind, and solar. It is not an all of the above energy strategy. Notwithstanding the Trump administration's claims, renewable sources have clearly been targeted and excluded from that strategy. From my days in Massachusetts, I'm most familiar with the offshore wind where the Trump administration on day one issued an Executive Order to stop all offshore wind projects, thwarting New England's plan to build 9,000 megawatts of offshore wind by 2030. Most of the administration's arbitrary actions with respect to offshore wind have been overturned in the courts, but the uncertainty has dampened any new development. More recently, the Trump administration is paying billions to buy out the leases for offshore wind projects off the coast of North Carolina, New Jersey, and New York, and California. As far as the tax credits that would've made wind and solar projects cheaper, the one big ugly bill, I call it, from last July, drastically curtailed the 30 percent tax credits available under the Inflation Reduction Act by requiring projects to begin construction by July 4th, 2026, or be in service by January 1st, 2028. The EPA's Solar for All program, which was canceled by the Trump administration last August, would've provided $7 billion to expand residential solar access for low income and disadvantaged communities. Pennsylvania was scheduled to receive $156 million. Most recently for onshore wind, the Trump administration two weeks ago, pulled the plug on 165 onshore wind projects representing 30 gigawatts of generating capacity based on claimed national security interests. It is simple economics that when demand vastly outstripped supply, prices go up and consumers are bearing the impacts of a deeply flawed and skewed national energy policy. These rising energy costs impose real challenges for Philadelphians struggling to pay their utility bills. And while the forces driving these cost increases are largely outside of the city's control, there are some actions the city could take to help address this issue. For one, the recent creation of the Green Bank by the Philadelphia Energy Authority will create new opportunities for low-cost financing of energy projects that should reduce reliance on regional markets and produce lower energy bills for customers. Continued commitment to energy efficiency programs is critical to give retail customers the tools they need to manage their energy bills.

And finally, the city may want to consider getting more involved in utility rate cases at the State PUC. While the proceedings are complex, and I'm certainly well aware of that, having been in that hearing room for over 40 years, the city could have an impact in shaping the outcomes by thoughtfully weighing in on issues of particular importance. I appreciate the opportunity to be able to share these comments with the Council. CHAIR THOMAS: Thank you. Please state your name for the record. I'm sure you know the routine, and you may begin with your testimony. After this panel is testify, I'll open it up to questions for members of the Committee. Thank you.

Great. Thank you. Good afternoon, Chairperson Thomas, Chairperson Driscoll, and members of the Committees on Legislative Oversight and Transportation and Public Utilities. My name is Elizabeth Lankenau, and I am the Director of the Office of Sustainability. I'm here today to testify on Resolution No. 250896 regarding the rising costs of energy bills. Thank you for convening a wide range of perspectives on this issue. The Office of Sustainability was created in 2008 to promote policies and programs to meet the city's sustainability goals. To this end, our office works with partners throughout the city to improve quality of life for all Philadelphians through advancing environmental justice, reducing carbon emissions, and preparing for a hotter and wetter future. As a key part of our office's mission, we work to improve all Philadelphians' access to clean, affordable energy. As many of you here today are aware, Philadelphians face some of the highest energy costs relative to residents' income in the country. With a quarter of low-income households in our metro area, spending more than percent of 4 their income on energy. This crisis 5 is caused by interrelated factors 6 such as poverty, aging housing 7 stock, rising energy costs, and 8 insufficient resources invested in 9 building repairs and energy 10 upgrades. 11 High energy burden or a 12 high ratio of energy costs to income 13 disproportionately affects 14 low-income owners and renters, as 15 well as BIPOC households in 16 Philadelphia. To address this 17 urgent situation, in 2021, OOS held 18 a series of Energy Burden Focus 19 Groups across six of the most energy-burdened communities in Philadelphia. Drawing from this resident feedback in 2023, OOS initiated the development of an Energy Poverty Alleviation Strategy. Key recommendations from this report include the following: First, partnering with energy utilities and encouraging continued investment in expanded access to utility assistance and energy usage reduction programs. Second, expanding the city's energy efficiency initiatives with a focus on home weatherization. Modeled data shows that approximately 70 percent of the city's single-family dwellings leak energy, which significantly increases energy costs. Interventions include cool roofs, increasing adoption of heat pumps for affordable cooling, and expanding access to rooftop solar, such as through the Philadelphia Energy Authority's programs. Strengthening partnerships in community and -- Third, strengthening partnerships in community capacity to address energy costs, especially supporting the city's network of Neighborhood 5 Energy Centers. 6 The Neighborhood Energy 7 Centers are an established, trusted 8 network of community-based 9 organizations that serve as a 10 one-stop shop for community members 11 to learn about utility bill 12 assistance programs, home repair and 13 weatherization, budget counseling, 14 and connection to services. 15 Since the launch of the 16 Energy Poverty Alleviation Strategy, the city with its community and agency partners has advanced several initiatives to address energy affordability. Key achievements include the launch of the city's first Mobile Energy Center, increased investment in energy education, a community scale cool roofs pilot in Strawberry Mansion, the launch of a clean energy workforce strategy, and continued investment in housing programs to better address rising energy costs through the division of Housing and Community Development, the Philadelphia Housing Development Corporation, the Philadelphia Energy Authority, and the Office of Community Empowerment and Opportunity. The Energy Coordinating Agency is the city's implementing partner for mobile -- the Mobile Energy Center, energy education, and cool roofs projects. A first of its kind nationally, the Mobile Energy Center expands the city's ability to reach Philadelphians who need energy support.

While Neighborhood Energy Centers provide critical services in the communities they serve, many residents live in areas outside of their reach. Operated by the Energy Coordinating Agency, the Mobile Energy Center helps close that gap by bringing energy assistance, education, and resources directly to residents. Connecting more households to the support they need to reduce their energy costs. Shortly after its launch in March 2026, the Mobile Energy Center connected 28 residents with energy and bill assistance programs. The Energy -- and the Energy Coordinating Agency separately held 62 energy education workshops for adults and for children, 18 empowering 1400 adults and children to manage and reduce their energy use. In another recent accomplishment, the city has launched a community scale cool roofs project in Strawberry Mansion with the Energy Coordinating Agency as the city's implementing partner. Cool roofs reflect more sunlight and absorb less heat than conventional roofs, helping keep buildings cooler while also extending the lifespan of roofs. The EPA estimates they can reduce indoor air temperatures by two to five degrees and reduce cooling demand for air conditioning by 10 to 20 percent. When applied at community scale, as with the pilot in Strawberry Mansion, they may also help reduce the urban heat island effect. This relatively low-cost intervention can not only provide benefits for individuals through lower energy costs and cooler indoor air temperatures, but can also deliver broad benefits for communities; lowering heat vulnerability, improving air quality, and leading to safer and healthier communities. To date, 62 cool roofs have been installed in Strawberry Mansion. Another opportunity identified in the Energy Poverty Alleviation Strategy was the need to scale up Philadelphia's clean energy workforce to meet the growing demand for energy upgrades. In May 2026, OOS in partnership with the City College for Municipal Employment and Workforce Programming team, will publish Building Green Futures. A roadmap to strengthen Philadelphia's clean energy workforce critical to reducing energy costs while expanding access to quality jobs and economic opportunity. In addition, the city has expanded its energy and housing programs to better address rising energy costs. The Philadelphia Housing Development Corporation now administers the Weather Resistant -- Weatherization Assistance Program, increasing the city's capacity to deliver energy efficiency improvements. PHDC expects to weatherize around 400 homes this calendar year. CEO operates the BenePhilly program in partnership with community organizations to offer residents free, one-on-one assistance enrolling in public benefit programs, including energy assistance programs like the Low-Income Heating and Energy Assistance Program, or LIHEAP and PECO and PGW's customer assistance programs. Mayor Parker's historic investment in the HOME Initiative is also critical. Many Philadelphia -- pardon me. Many Philadelphia homes require basic repairs before they can be weatherized or upgraded with energy efficient systems making housing repair a foundational step toward energy affordability. Expanded programs such as the Basic Systems Repair Program and Restore, Repair, Renew are helping more households complete these essential repairs and preparing homes for future energy upgrades, with One Philly Front Door facilitating ease of access to these programs. The Rental Improvement Fund also supports small landlords and making repairs and energy efficiency upgrades. By providing direct funding for repairs and energy efficient upgrades, RIF, the Rental Improvement Fund, circumvents the split incentive challenge that often disincentivize landlords from paying for upgrades that lower tenant utility bills. The Eviction Diversion Program helps keep Philadelphians housed by supporting renters whose ability to pay rent may also be strained by rising energy costs.

DHCD also supports the distribution of financial assistance to low-income housing to help residents avoid utility shutoffs. In addition, the Philadelphia Energy Authority's program, such as Build to Last and Solarize Philly, continue to help residents lower energy costs and become more energy secure and resilient. Together, these investments play an important role in making energy more affordable for Philadelphians, while also delivering broader quality of life benefits for individuals and communities. Addressing rising energy costs is a complex challenge that requires action at multiple levels. While many drivers of these costs are shaped by regional markets and decision at the Commonwealth and federal levels, OOS in partnership with city departments is committed to continuing to advance local solutions that reduce energy burden for all Philadelphians. Thank you for this opportunity to testify. With me are Nidhi Krishen, OOS's Program Director of Citywide Energy Solutions; Rachel Mulbry, the Director of Policy and Strategic Initiatives for PHDC; and Beth McConnell, Deputy Executive Director for Policy and Programs from CEO to assist me in answering any questions. So thank you. CHAIR THOMAS: Thank you. Chair recognizes Chairman Driscoll. CHAIR DRISCOLL: Jamie, I've got two questions. First one, I think is very important, Patriots or Eagles?

I've never been a Patriots fan. Always Eagles. I love it lately. CHAIR DRISCOLL: There you go.

Never been a Patriots fan. CHAIR DRISCOLL: You're up to a good -- you're up to a good start here in Philadelphia. I just have a question, you know, I know that New England, obviously it's very cold up there. I did spend some time there, and you have some, you know, very high energy costs, right? So at one point, I think you imported -- they imported liquid natural gas from Russia.

Yes. CHAIR DRISCOLL: Right? And then during that fern that very cold time, I guess the heating oil was the most used method of heating. What could we learn from your experience there?

One of the things I learned -- I mean, I spent a lot of time teaching law at West Virginia University, so I was very familiar with PJM. And one of the things I learned going to New England is it's very much an energy island, which was very bad in the case of -- so they're dependent upon LNG. And LNG is now a, I guess, a global commodity. So when Russia invades Ukraine, LNG prices went through the roof as did electricity prices and natural gas prices in New England. So, I mean, I think it's great being part of a very vibrant thermal market. I think it's -- and there's a -- you know, there's a lot of discussion of should there be more natural gas brought into New England. And I think, you know, we had -- we had a governor of New York who tended to block all those pipelines that would've taken the Marcellus Shale gas into New England. I think electricity prices would probably be lower. I think what was the decision was made by New England was we're going to go big on offshore wind, and I think that was actually a pretty good strategy, but it's been completely stymied by just pulling the plug on all those -- all those projects. But I think --I think a diverse source of resources and I think it's -- and wind and solar need to be part of that mix. And battery storage technologies has amazing advances. So I think, you know, taking advantage of really truly all the above energy strategy, and PGM is off to a great start. They just got to get more stuff -- more stuff built. CHAIR DRISCOLL: Okay. CHAIR THOMAS: Great questions, great answers. Chair recognizes Councilmember Landau.

Thank you. This is for Director Lankenau. What's the city's strategy for intervening in PECO rate cases, PJM proceedings, and other regulatory proceedings in order to make energy bills more affordable, clean our air, and protect a livable climate?

Sure. I can speak more to intervening in the PECO rate case. We reached a settlement in the prior case. We were coordinating with the administration on whether to intervene on the one that was recently dropped. And so those are active conversations. I think one area that we do need to strengthen on is being more present with the PUC for sure.

And how about PJM?

In PJM we have not done any work there yet. Yeah.

Okay. And how are you working with the Neighborhood Energy Centers to ensure that they can provide residents with essential information and support?

Sure. Yes. We're working through our Deputy Director Nidhi Krishen, and she can come up and give more detail, but she is working very closely with the Energy Coordinating Agency, whoever oversees all of the NECs and worked very closely through federal funding, formula funding that we received, the Energy Efficiency Conservation Block Grant to make sure that some of that funding went toward the Mobile Energy Center. And so that's delivering all kinds of information to neighborhoods or individuals who may not be able to access the sites. 7

8 Uh-huh. 9

So that's 10 been -- and it's new. Even -- we've 11 already done a lot since March. So 12 the Energy Coordinating Agency has 13 already done a lot since March, 14 yeah. 15

16 Okay. Thank you.

You're welcome. CHAIR THOMAS: Thank you. Two questions before I let you go. The first question is please, both of this, and I'm going to ask both questions. You can answer them and then we'll let you go. The first question is around data centers. Just talk to us about your perspective on data centers. How should we be thinking about them as a region? The second question is, similar questions that I asked to the last panel. PJM was founded about 100 years ago, and it was a idea that came out of the region coming together to determine that the cost of energy and the impact it was having on people wasn't working. And so that's how PJM was created. A hundred years later, do you think that we need to revisit the conversation that we had 100 years ago around PJM and think about our perspective on energy? I think for us on this legislative body, I think one of the things that we're challenging is the idea of people profiting off of energy, right? Like, energy is something that is mandatory, like water and air. And the idea that some people should be able to profit off of other people being required to have to use these things to survive, I think it does raise some ethical and moral questions, and I think that's the foundation of what inspired the Chairman and I to have this conversation today. So I would love to get your perspective on those two things. And after that, we'll move on to the next panel. Thank you both for being here.

Sure. And are both questions for both of us, or both for me? CHAIR THOMAS: I will -- I would definitely appreciate it if both of you can answer both questions, if that's okay.

Do you want to go first?

Sure. Thanks for the question, Chair Thomas. On data centers, I mean, I look at the testimony Representive Fiedler and the bill that was passed unanimously in the house. I mean, those are the things that we need to be thinking about, making sure existing customers are not adversely affected by the addition of the data center loads. And there, I think we're learning more and more about the flexibility that data centers may have. We can actually treat it as a -- as a resource to some extent. But so we're -- we're learning a lot and certainly been a lot in terms of -- it's kind of a moving target. All the things that have happened with data centers, with the governors getting involved, the White House getting involved, and PJM coming up with different proposals that they're filing with FERC. FERC getting involved. It -it's kind of a moving target. But the bottom line is, it seems like it's important for this administration that we win the AI race, which means the data centers need to be built, but we just need to make sure that existing customers aren't adversely affected. PJM, I think it's a great question, and I think it -- I think it worked fairly well when you have relatively stable or no load growth. And I think what we've seen with this data center load and these -- and these massive load growth projections, the capacity market's really not well designed to get things built. And it's sending a pricing, but we're not actually getting enough things built. So it needs to be a combination. One of the things, in terms of lessons learned -- back to Chair Driscoll's questions, lessons learned from New England is, you know, we had a -- like a procurement that was going on, states were procuring offshore wind, states were doing things on their own in addition to the capacity market that was run by ISO New England. It seems to me you need that hybrid model to make sure that the resources -- adequate resources are coming online to make sure that we don't have these price spikes in response to increasing load growth. CHAIR THOMAS: Thank you, sir. Great answer.

Great. Yeah. So for data centers, I think you're going to hear from -- I previewed your -- the testimony, you're going to hear from a lot of different entities. And objectively, yes, they are certainly energy powerhouses. I would say that, you know, we and other departments have given feedback, but we are not able to speak on behalf of the mayor. But, you know, we have advised from a sustainability perspective on things to consider as well as other departments. In terms of PJM, yeah, I mean, I think all kinds of models need to be reviewed. This -- they've been around forever, as everyone has discussed so far. I'll be honest that this is not my depth of expertise, but I have more of that expertise on my team, and so that's something that we should definitely talk about as a sustainability office about how we get involved more with the PUC and PJM. So I appreciate that question. CHAIR THOMAS: Thank you. Thank you. Thank you both for being here. Thank you for the work you've done as public servants. Thank you for traveling and taking the time to come to Philadelphia to have the support and conversation for us. We appreciate it. And know that for the admin, we are -- we're looking at this as a regional approach, right? We want to be able to have a conversation about the tri-state area to figure out what can we do? And we're looking to the administration as leaders to figure out how do we address the affordability crisis that we're facing. Councilmember O'Rourke, and, you know, as council members, you see us on our phone, but we're working. Councilmember O'Rourke sent us information that says that in one of the largest cities in the entire world, one of the biggest concerns that they have is the increase in cost of utility, not crime, right? Not schools, right? But the increase in cost of utility. That's unfortunate -- that's an unfortunate crisis that we as government have created for the average everyday person who's already struggling with so many other issues. And so I think it's up to us as government to figure out how do we solve it. And I appreciate you both for taking the time as public servants to be a part of this conversation today. So thank you.

Thank you. CHAIR THOMAS: Thank you. Madam Clerk, can you please call up the next panel?

Next, we will have the director of policy advocacy and external affairs at PECO, Thomas Bonner, followed by Denise Adamucci, and Steven Bennett. CHAIR THOMAS: Thank you all for being here. And thank you for the work that you do. Similar to the other panels that was here before you. Please state your name for the record and we'll allow all three of you to provide your testimony before we open it up from questions from members of the Committee.

Good afternoon, Chair Thomas, Chair Driscoll, members of the Joint Committee, and guests. My name is Denise Adamucci. I'm the senior vice president of Customer and Regulatory Affairs at PGW. Thank you for the opportunity to speak on energy affordability, a daily reality for hundreds of thousands of Philadelphia families and businesses. PGW has submitted my full testimony in response to Resolution 250896, and I am going to provide an elevated summary for today's discussion. While natural gas remains the most affordable and cost-effective primary heating fuel for a household, these important conversations are vital, especially considering the initiatives that PGW is exploring to potentially diversify its offerings. Most could be prohibitively expensive for large portions of Philadelphia's population to afford. So who is PGW? We are not an investor-owned utility. We are municipally owned, PUC-regulated, non-profit gas utility. So we are two -- only two of them are in the Commonwealth of Pennsylvania. That means we have no shareholders, we pay no dividends, and we earned no 17 rate of return. Every dollar that we collect then goes back into serving our roughly 500,000 customers. So in the end, that structure defines everything that we do. So how do we keep rates low? 3 percent decrease in average annual bill costs between 2014 and 2025. I would like to make that very clear. In 2014, the average annual bill for a residential customer was $1,257. In 2025, the average annual bill for a residential PGW customer was $1,178. That is the result of disciplined financial management and strategic investment. A critical and often overlooked driver of that affordability is our Liquified Natural Gas or LNG infrastructure. For over 50 years, we've stored pre-purchase gas locally and deployed it precisely when demand peaks and market prices spike. This past winter, when other utilities struggled to secure supply, PGW maintained uninterrupted service throughout. We estimate that our customers avoided $90 million in additional gas costs during that cold weather event alone. Over the life of the program, our local LNG has saved customers over $4 billion. This is one of the most consequential investments this city has ever made in energy affordability. So how do we support our most vulnerable customers? Of our 500,000 customers, approximately 234,000 are low income or working poor. This is the highest proportion of financially vulnerable rate payers of any utility in the Commonwealth of Pennsylvania. Our customer responsibility provides reduced bills and debt forgiveness with an average annual benefit of $909 per participant. Our low-income usage reduction programs invest in weatherization that lowers every bill going forward, not just one. In 2024, we launched a Hardship Fund Pilot Program that targeted the working poor population, so households earning too much to qualify for traditional assistance, but not enough to comfortably afford their bills. This provided one-time grants of up to $750 per customer. In 2025, our universal service program spent over $77 million in rate payer spending directed at Philadelphia's most vulnerable residents. We also depend heavily on LIHEAP funding. This season, more than 35,000 Philadelphia households receive nearly $11 million in LIHEAP assistance. Yet Pennsylvania remains a cold weather state without a state supplement to the federal LIHEAP allocation. That must change. So how can this body support -- help support our efforts? Our asks are specific and actionable. First, help to support the creation of a Pennsylvania state supplement to LIHEAP and ways to better share the cost of supporting customers so the burden is not left solely to Philadelphia's rate payers. Second, support continued infrastructure investment in Philadelphia, including our LNG storage operations, federal grant programs, and modernization initiatives that improve safety, reduce emissions, and lower long- term customer costs.

Our LNG infrastructure is not legacy infrastructure; it is a strategic community asset that saved Philadelphia customers $90 million in a single weather event and over $4 billion across its lifetime. Third, continue to help PGW promote customer utilization of our universal service programs. These represent a proven and targeted investment in the residents who need help the most. And fourth, recognize natural gas as an essential component of Philadelphia's energy affordability story. Pennsylvania's natural gas abundance and even more, essentially our ability to store and deploy it locally through LNG, is a structural economic advantage. Policy should build on that advantage and not erode it. In closing, PGW exists for one purpose; to provide safe, reliable, and affordable and sustainable energy for every Philadelphian. This past winter when temperatures dropped and demand surged, our customers stayed warm. Their increased bills reflected their usage, not a market end crisis. That is what 190 years of responsible infrastructure investment looks like. We do ask you for your continued support in ensuring we can keep delivering it. Thank you.

So thank you Chairman Thomas and Driscoll, and members of the Committee for holding this important hearing today. My name is Tom Bonner, and I serve as director of Policy Advocacy and External Affairs for PECO. During my years at PECO, I've focused on 13 the development of public policy 14 solutions that encourage clean and 15 advanced technologies while 16 maintaining customer affordability. 17 I've had the pleasure of working 18 with many of the people in the room 19 today, and many of the folks that you're hearing from. I'm a native Philadelphian and a graduate of the University of Pennsylvania. In my testimony today, I'd like to describe how our industry is structured and discuss our commitment to affordability. So first of all, the main components of a customer's electric bill are distribution, transmission, and generation. About 38 percent of the average residential customer bill is for energy delivery charges; that's the transmission and distribution. Okay. And 42 percent is for generation with the 12 percent for a range of government 13 mandated charges, including 14 universal services, energy 15 efficiency, renewable energy, and 16 taxes. Distribution reflects the 17 cost of owning, operating, and 18 maintaining the local grid that 19 delivers electricity directly to 20 homes and businesses. These costs include both capital investments and our O&M expenses. Distribution is a regulated utility service provided to all customers at rates reviewed and approved by the PUC through tariffs that treat similar customers equally. We are pleased that the PUC has recognized PECO as the Pennsylvania's most reliable large electric utility, and the only large utility in the state to meet PUC's reliability benchmarks. Since 2010, the investments that we've made in improved reliability have improved reliability by 35 percent. That means fewer lost hours for those working or studying at home, less lost operating hours for small businesses, and fewer lost school days for children. Reliability investments have real and concrete benefits for the public that you represent and that we serve. And as extreme weather events become more frequent and severe, the investment we've made in the grid is making a real difference. Transmission is the cost of operating and maintaining the high voltage grid that delivers electricity from generators to local distribution systems. These costs are reviewed federally and allocated to utility customers by the electric distribution company, in our case, PECO. Supply is the cost that the customer pays for the electric commodity, the actual electrons that flow through the system, either by their competitive supplier or through utility default service. In Pennsylvania's deregulated electricity market, customers have the option to purchase their supply from either a non-utility supplier or receive default service from their utility. While competitive suppliers are unregulated, utility default service procurements are conducted under the oversight of the PUC and must be made on a competitive, least cost basis and passed through to consumers without any markup. Rising supply costs, particularly higher capacity costs in wholesale energy markets, are putting significant pressure on customers. Since 2024, average residential bills have increased by $28 or 28 percent, driven primarily by higher capacity costs. Capacity costs are the charges that utilities pay to ensure that we can meet peak demand during the -- during extreme conditions. Another factor for many customers, and one you heard from Chair Fiedler about, is retail supplier overcharges. Last year, the small percentage of PECO customer -- electric customers, about 20 percent, who elect to buy their energy from retail suppliers, paid more than $100 million more than they would have if they were on utility default service.

What's worse in many cases, it appears that the suppliers are actively targeting our lowest income, most vulnerable communities, for their marketing efforts. So when we get to some recommendations at the end, we will strongly support the Bill that that Chair Fiedler talked to you about there. In terms of affordability and utility rates, as my friend Liz Lankenau mentioned, we did reach a settlement with the city on our 2024 rate case. And successfully competed -- completed about 15 commitments that we made in that case, including building a solar savings calculator for low-income customers, and also assisting the city in evaluating potential locations for fleet EV charging. In terms of our most recent rate case proposal last month, PECO did withdraw this case. While the proposed rates were designed to support long-term safety and reliability investments, customer affordability concerns have certainly risen to the top. Basically, there's a balance we're always trying to strike between reliability and affordability. And the message we heard from our stakeholders, our customers, and others loud and clear was, now is the time to take a step back on some of the new capital investments. Moving forward, we'll continue to invest in our electric and natural gas systems to maintain safety and reliability, but there will be some investments in proactive upgrades to the system that will be deferred. And this will require some difficult decisions. While we try -- while we work to minimize impacts on reliability, some investments like the upgrade of our oldest and lowest capacity distribution system, our four-kV system, those may have to wait for another day. But we are looking to find that balance between expanding and promoting greater reliability, but also preserving affordability. In terms of our programs for low-income customers in 2025, our CAP program, Customer Assistance, provided over $200 million in discounted bills and arrearage forgiveness for low-income customers. CAP is based on an affordability index set by the Pennsylvania Public Utility Commission to ensure that a customer only pays a fixed percentage of their income, as long as they stay within certain usage targets. In terms of the person who testified earlier, I have greatest sympathy for their situation. They're doing many of the right things. They're on our CAP program or have been in the past. They did sign up for LIHEAP. We hold about 300 events a year encouraging people to sign up for LIHEAP and trying to make that as easy as possible. Since they are a electric heating customer, I don't know if that customer is on a budget bill where they pay a flat amount every month rather than a higher bill during the winter, but that sounds like it would be a really good idea for them. And then one other thing that I did discuss briefly with our friends from CLS, it sounds like the core problem here is the customer is a very, very high user because their home needs significant repairs. One of the Bills, and I'll have to say Chair Fiedler was a little too modest. She didn't mention one of the good Bills that her -- that the House has passed to reform, Pennsylvania's energy efficiency programs that would allow PECO, as we fulfill our state mandates, to set aside more of that money to help with those very expensive whole home improvements outside of what's called -- what's our mandate for total usage reduction. Right now, if we don't hit those mandates, we get fined up to $20 million. So you tend to focus on the savings that are easier to achieve, so you don't get fined. The law that the House passed would let us set aside programs that are targeted for the low-income community and be able to say, we'll spend more dollars there because we know that's helping our most vulnerable. We've really strongly supported that bill. Just want to talk briefly about -- CHAIR THOMAS: Can we -- we do want to get the questions. So can you --

Sure. CHAIR THOMAS: -- kind of summarize it a little bit?

Absolutely. CHAIR THOMAS: We want to allow the other panel. We have one more panel and then we want to get the questions too.

Yeah. Data center consumer protection, we absolutely agree that customer -- our -- the rest of our customers should not subsidize data centers. That's why we have what we call Transmission Security Agreements, where they have to commit money upfront. That if they don't meet the usage they say they're going to use to pay back investments in rates, we just take the money directly from the bank. CHAIR THOMAS: All right. That's my bad. Slow down.

Yeah, no 5 problem. CHAIR THOMAS: Can you explain that again please?

Yeah. So when -- so when a data center applies to be interconnected, it usually takes a pretty significant amount of investment in the transmission system to bring that customer online. And then you count on recovering that investment in your rates over time. The thing we're trying to avoid is building it and they don't come. Where we would make the investment in the transmission system and that customer never uses anywhere near as much energy as they said they were going to use, in which case we'd have a revenue shortfall. So what we do is we say you have to put up a 10-year Letter of Credit where if you don't use what you said you were going to use, we go to the bank and we draw down that Letter of Credit. It's basically a take or pay contract with the data center to ensure they contribute as much to the system as they said they would. CHAIR THOMAS: All right.

Does that help? CHAIR THOMAS: Yeah. So if you can summarize your testimony, and then we can allow the third panelist. I want to try to jump into questions to allow members to discuss this issue before we move on to the final panel, because I think we have a hard stop that's approaching pretty soon. So --

The last thing I'll say is agree with you. There's no way we can address any of these challenges without more generation. And we need to re-look at our state laws and make sure we have a system in place that guarantees there is always enough generation. Compare it to being -- if you're on an airplane, would you rather have the runway maybe be a hundred feet too short or a hundred feet too long? I'd always -- I'd always opt for a hundred feet too long, and we have to look at our electric generation supply. CHAIR THOMAS: I'll bet some members are going to ask you questions about that, but that's great information and great intel. And I think that that's part of the reason why we had this hearing, Mr. Chairman, to have this type of information. So thank you.

Thank you. CHAIR THOMAS: If you could state your name for the record at begin your testimony, and then we could open it up to questions, that would be appreciated.

Yes. Thank you. So Chair Driscoll, Chair Thomas, members of Council, thank you for the invitation to participate in this hearing to provide PJM's perspective as it relates to preserving electric grade reliability during this period of heavy forecasted load growth and affordability challenges that, to Chair Thomas's point, are not just a regional or tri-state challenge, but they are a national and global challenge. My name is Stephen Bennett, and I serve as senior manager of governmental services for PJM Interconnection. PJM is based in Audubon, Pennsylvania, just off of Route 422 North of the Schuylkill River. And I say that because I would like to invite the Council members to visit us whenever you may like. If you can come to PJM, we can have an extended conversation about who we are, what we do, the challenges that we're facing, the opportunities that we have to help address those. As well as, you can have an escorted tour of our operation center where we have university, military, and trade school trained professionals there, by seven, to make sure that the 13 grid is safe and reliable at all 14 times. 15 PJM serves 67 million 16 people over our footprint of 13 17 states in the District of Columbia. 18 We are a mission-driven 19 organization, and our mission is 20 reliability. PJM is a federally 21 regulated entity, and we are a 22 not-for-profit. So I want to break 23 that down just a little bit. PJM is 24 subject to the statutory provisions of the Federal Power Act. We are subject to the regulatory oversight of the Federal Energy Regulatory Commission or FERC. And we have governing documents that are approved by FERC that dictate how PJM runs our markets, how we plan the transmission grid, how we run our operations, and how our members participate in PJM. We liken our role to that of an air traffic controller; we do not own the infrastructure inside of PJM. We are a not-for-profit; we do not benefit or profit from any of the energy that's generated or transmitted across our footprint. In fact, neither I nor any of my colleagues nor our families are permitted to own stock or financial interest in any of the companies that participate in PJM. We are a not-for-profit organization, and our mission is reliability. I'm going to pull a little bit of a Jalen Hurts audible here because I have -- I have a whole thing of testimony. I've submitted it a bit late last night. You may or may not have had an opportunity to look through it. But I really want to focus on data centers and the impact that data centers are having on our industry right now. Data centers are an extremely important economic development opportunity for the State of Pennsylvania and other states. Governor Shapiro has made it very clear to PJM both in his direct and indirect communications to us that he wants to see data centers built here in the Commonwealth. Data centers are important to national security, and what I hope, and many of us hope, is that they're important to maintaining the United States' position in technology and medical research. But they use a lot of energy, and they're coming online in a way that -- in a speed that we have not seen before in our industry. This is a precedent setting moment. This is a paradigm change for the utility industry. You think about utilities and absolutely no 10 disparagement to utilities or to PJM or anything, but we are not a fast- moving industry usually. Our focus is on conservative management of reliability. If we move too fast and break things, then that means blackouts or worse. The technology industry, the Silicon Valley industry that's largely funding and is investing in data centers operate at a very different speed.

” So we were actually trying to marry up these diametrically opposed industries to move forward and capture the national security and economic development priorities of building data centers but also maintaining the reliability that is gained by deliberate and conservative approach to designing the grid. It's challenging and it's becoming expensive because as one of the -- and I believe it was Chair Thomas but apologize if it was -- if it was someone else. This load is coming on so fast, it's coming on -- it's the equivalent of dropping a city's worth of load in a warehouse facility in 6 to 12 to months. 17 To build a power plant, it can take 18 two years, five years, seven years. So there is a disconnect between how fast -- and in fact, many of the data center developers will tell you that speed to market is of more value and importance to them than the actual cost of developing the facility. So we are in a situation where we need to make sure that we can build generation faster. That we can get it onto the system faster. And that is a challenge for us because of things like supply chain backlogs. Right now, it takes about five years to get a natural gas turbine. That's just it. You know, there are some opportunities to get them a little faster, but for the most part, five years. Grid infrastructure, things like transformers have a -- have an, on average, a seven-year backlog. And we need grid infrastructure to interconnect both the data centers and the generators. So we're looking at systemic obstacles to getting more generation on and getting it on faster. That doesn't mean we're not trying. So PJM's board of managers recently, in some way in response to the White House and all governors of PJM came up with a plan to try to do a couple things to make this situation better and to meet this data center moment. One thing is that we have to improve our load forecasting. So a lot of this is -- a lot of the load that we are seeing is coming in as load forecast. We don't know that we're going to see all of that load and if it's going to actually materialize. So we have to make sure our forecasts are as accurate and as informed as possible. We're also looking for the data centers to help us bring generation. So we are doing things like bring your own capacity. So if you're a data center and you want to interconnect at PJM and you want to do so at speed, help us bring more capacity onto the grid. Because by doing so, that not only addresses reliability, but that also helps us with an affordability perspective. And if you can't or don't want to help us bring capacity on what we're trying -- what we want to have happen is that as a data center, you would be the first entity curtailed in the event that we had to -- sorry, in the event that we had to shed load in periods of grid instability. And so by saying, like, help us address reliability, help us address affordability, and if you can't, then you're likely going to be the first one to come off the system as opposed to a residential customer. We don't want to curtail a residential customer ahead of a data center if that data center is creating part of the challenge that we have from a reliability perspective. We're working with policy makers at all levels. We're open to suggestions. We want to -- we -- PJM is mostly a policy taker. We're certainly not a policy maker. So we want to be a platform that allows for the policy priorities of our states and our local jurisdictions to move forward with the energy policy that they see fit. But please understand that this is a global issue. This is a regional issue. This is a global issue. This is a national issue. Everybody is challenged by these -- by the situation that we find ourselves in. How do we get more supply infrastructure affordable, but in a way that matches the speed at this moment? The last thing I'll say, and then I'll -- I will -- I look forward to your questions.

Chair Thomas, you're absolutely right. We were formed a hundred years ago. We were formed at that time because there was a recognition of the value of regional cooperation. So PSE&G and PECO understood that it was better to cooperate than to try to do everything on your own. A little bit later, BG&E down in Baltimore, recognized the value and joined as well. So PJM, Pennsylvania, Jersey, Maryland. And since then, we now serve states in the District of 12 Columbia. I will say that, that 13 idea of the benefit and value of mutual cooperate -- cooperation, scalability, and geographic diversity, that actually hasn't changed. That still is -- to this day, is still demonstrably valuable to the people that live and work in our footprint. Thirty years ago, we actually became a system operator and we've evolved a little bit, but at the time we were an ISO and we use a lot of acronyms. Now we're an RTO, the Regional Transmission Organization, and we agree with you, Chair Thomas. It is time to take a look at all the things that we do. We actually just re released a paper a few days ago that said PJM commits to looking at absolutely -- to potentially redesigning every aspect of what we do because again, this is a paradigm changing moment. And although a lot of what PJM has done in the past was successful in maintaining reliability and affordability, there's no guarantee that what we've done in the past will actually work in the future. So we're going to look at our market structures, we're going to look at our load forecast. We're going to look at our planning to make sure that we're sending the right signals, that this is an investible market where infrastructure can be built and that we're minimizing the affordability challenges to the people that live in our footprint. Thank you, and I look forward to your questions. CHAIR THOMAS: Thank you. Chair recognize -- thank you. And that was very informative for the record. I appreciate all three of your testimony and I think that the other witnesses were great, but this is why it's important to have this conversation. I recognize Chairman Driscoll. CHAIR DRISCOLL: Thanks for the invite, Steve. I think we're going to try and take you up on that this summer.

Great. CHAIR DRISCOLL: And I just wanted to start off by thanking both PGW and PECO. You know, everybody talked about that January, February cold snap, but we actually had one in late October, early November, and you folks worked with us to, in a notch, move the shutoffs -- stop the shutoffs and provide some further guidance to our community. So upfront, I wanted to thank you for that. And also for the rate withdrawal that I think you, you know, you guys recognize how important that was, and we thank you for that. And so as, you know, Chairman Thomas as I think, you know, highlighted today is this regional cooperation approach is how we have to move forward. You know, we need new energy sources; we need affordable sources. And I think, you know, this hearing, Chairman, is very helpful for me and thank you for calling it. CHAIR DRISCOLL: Thank you, Mr. Chairman, and thank you for your leadership with this. Before I open it up to questions, just a couple things real quick. First and foremost, for consumer -- for the average citizen who's watching outside, right? I posted on social media that we were having this hearing and somebody just said, Oh, man, my bill went up $300 in the last such and such. Can you -- can -- it doesn't matter which one of you, can someone just take 30 seconds to, in regular terms that the average person can understand, tell them why their bill went up. Why did your bill go up and what caused your bill to go up? 30 seconds that the average person can understand.

So as you noted PECO did withdraw its rate case and even if that had been put in place, nothing would've happened till next year. So it wouldn't have been on the distribution rate, it could be usage. The other thing we talked about, the person could be with a retail supplier. Because a lot of times the person will get a bargain rate when they first sign up that might last for six months or a year. And then when that's over -- CHAIR THOMAS: So no, we're thinking about residents not businesses --

-- it could go way up. CHAIR THOMAS: -- just like your average resident. Like for the average resident, why did my PECO bill go up? Why did my PGW bill go up? What is it with the average resident, you know, I haven't had a new business move into my neighborhood. Pretty much nothing in my life has changed, but for some reason my utility bill has gone up.

If it happened recently, it would either be increased usage or they're with a supplier who changed their rate.

So January and February -- CHAIR THOMAS: We can't hear you.

January and February are very cold, so customers did receive larger bills. The most essential thing for us is when that occurs and you're struggling, you should reach out to us. We have a myriad of programs that can help you, and it's really important that we make sure that you're being served by all those programs. CHAIR THOMAS: So I -- shameless plug, in the midst of the programs that you-all have. I'm just going to -- I'm just going to ask that we do a little better with customer service. So I know that the programs that you have are ones that are extremely effective. We -- I haven't always been a City Council person, and sometimes when you're trying to opt into some of these programs, there's a lot of steps. It's very time consuming and sometimes the person on the other end, they're not like the Chick-fil- A worker, right? So just want to go ahead and put that out there in the midst of talking about programs. I think that's something that's really important. Because just remember, if someone calls, something is wrong, right? They're not calling to congratulate you. The Chairman just congratulated you, we'll congratulate you in rooms like this. For the average customer that's struggling, I think that that's something that should be considered. Because folks -- you know, that's why they call our offices, because they know if we call on their behalf, it'll just be a little less of a shameful experience. And I say some things, I think sometimes when people go through these experiences, there's a certain level of shame that comes from that person on the other side dealing directly with the customer. My last question, same question I asked all the other panels, and I know you spoke to it in your statement, but I would love to hear from all three of you. PJM started a hundred years ago, and it started because we were facing this affordability crisis, this utility crisis. And like you said, folks decided to step in and say that we want to be a part of this solution to decide how do we regulate and deal with this new economy. When you look at where we are right now, I think that there's really a climate out there as far as how we charge people for utilities. And so do you think that we should revisit this conversation like we did a hundred years ago? And I'm not saying get rid of PJM, I don't think you've heard me say that in any of my comments thus far. But I do think that we are in a space and a place right now where, like you said, things are happening so fast; it's moving faster than what we've ever seen. And should we be rethinking what regulations look like? And what does a collaborative effort mean between all levels of government, especially for the tri-state area, to assure that we are managing people's utility bills to the best of our ability. If each of you could just take 30 seconds to answer that, and then I want to open it up to other members of this committee, and then I want to move on to the last panel before we meet our time constraints.

Yeah, I would say -- like I said in my testimony, we certainly agree with that. The idea that we need to look at everything because of the paradigm- shifting nature of where we are, with data centers, with the speed and the magnitude of load growth. So that's -- you know, that's what we're doing. We just revamped the way we interconnect generation because it wasn't well suited for the amount of renewable generation that we get. So we recognized that, and we were -- we spent a couple of years fixing it, and now we have our first cycle where we're seeking new generator interconnection. We had 811 projects with over 220 gigawatts of potential capacity that are seeking interconnection. So that's a good outcome. Now, just to put that in perspective, right now we have about 180 gigawatts. So we're actually the PJM market structure the way it is now. And not all of that's going to come online. I don't want to say that we're going to get 220 gigawatts of new generation, but that's the kind of interest there is in investing in our markets. And we get even a fraction of that -- CHAIR THOMAS: So you're basically saying that PJM will be open to a conversation to figure out what's --

A hundred percent and we absolutely are. And I will -- sorry. I will send you that paper that kind of goes over that thought. CHAIR THOMAS: Sure. That would be helpful. I'm not going to ask you guys to answer that question because I don't -- I think that -- I think that's a tough position to put you in. So -- did you want to?

Yeah, so -CHAIR THOMAS: Oh, please go ahead.

I would say number one - CHAIR THOMAS: You don't want to argue with me though, right?

No. Not at all. CHAIR THOMAS: Okay.

Number one, we don't believe that the PJM capacity market is ideally constructed. A one-year auction, three years in advance, probably isn't ideal for power plants to take five to seven years to build. And historically you've recovered the investment over 30, 40 years. We think we need to move to something that is better aligned with building new capacity. CHAIR THOMAS: Okay.

And the other thing is the state; we believe that laws should be changed to have the PUC be able to serve as a backstop to order new generation built when needed. CHAIR THOMAS: Thank you. And I'm good. I'm good. You're good. I'm going to open up to my colleagues. Colleagues, just keep in mind that we got a hard stop and I want to let the stenographer and the tech team get the thing too. So Chair recognizes Vice Chair Landau, and then we'll follow up with Councilmember Young, and then we'll be done with this panel and we'll move on to the last panel. VICE CHAIR LANDAU: Thank you. Thanks so much. I'm going to give a couple of quick questions to PECO and PGW. I don't get you often in one place here. So I wanted to know how many shutoff notices have been issued thus far this year and how many Philadelphians have been shut off?

Ma'am, I don't have that. I have to get back to you, but we will get back to you immediately on that.

The same. VICE CHAIR LANDAU: Okay. And now that LIHEAP has closed, how much grant assistance is currently available for your customers?

So PGW has a hardship fund program. Last year, we spent 1.5 million. It's in cooperation with the City of Philadelphia. So the city provides half of the funding for that program. So we have that grant program. We have our Low Income Usage Reduction Program. We spend $8 million a year on that. And shortly customers will be able to enroll themselves in that program so they can get their house weatherized. So those are our primary. We also have a demand side management program; it's about $2 million. So if you're replacing your heater, you can get an incentive to get a more efficient heater. It's an example of one of the programs in there. We'll install a low-income smart thermostat for free in low-income customers' homes. You can also get a reduced cost one online. So we do have a number of additional offerings while LIHEAP is closed. VICE CHAIR LANDAU: Yes.

I do have our 2025 numbers, and that is over 200 million for customer assistance, both the month-to-month reduced bills and arrearage forgiveness, and around 15 million in LIHEAP assistance. And we hold about 300 events a year with external parties to advertise both the CAP program and LIHEAP. VICE CHAIR LANDAU: Okay. It's my understanding -- I'm the head of the Tech Committee, and so it's my understanding there's a data sharing agreement for LIHEAP participants to send information from their LIHEAP applications to utilities. We've done a similar thing with some city programs and the Water department for the TAP program, and it helped enrollment significantly. Are you automatically enrolling those customers in programs like CAP or CRP?

The last I've talked with our low-income folks about this; we're still waiting on final implementation of those systems from the Department of Human Services in Harrisburg. But we are very excited about that and believe that can help save a lot of administrative burden and get more people signed up.

So under a PUC order, we have implemented a program where we will help people with an expedited enrollment if they're in that DHS program. So we have 5,600 customers who will be part of that expedited enrollment. VICE CHAIR LANDAU: Okay. But are you -- are you automatically enrolling customers? I'm sorry.

So all they have to do is consent to being enrolled and they will be enrolled. VICE CHAIR LANDAU: Okay. And last question -- last joint question. We have a bunch of programs at the city that are income-based. Would you be willing to coordinate with the city to make enrollment in programs like CAP and CRP more streamlined?

So we are working with -- right now with the water department. We're working with PECO also to make sure that our programs are weaved together more effectively so that customers don't have to go to multiple sources to get assistance.

Yes, we're trying to do everything we can to streamline. Obviously, we can't give away customer information without their consent to another party, but we have regular conversations with our friends at the city and PEA to develop the most efficient systems we can. VICE CHAIR LANDAU: It's -- I can't believe it's 2026 and how often we have these conversations about the fact that we have income guidelines. We have programs that can help people and people have to scour the internet or tables at resource centers to keep automatically individually applying to these programs. If we have to opt into data privacy things all the time, you can imagine opting into a program that would get you automatically enrolled in other programs as well. CHAIR THOMAS: Just important moment of -- I'm sorry. Moment of privilege from the Chair. What would you like to see from these -- in an ideal situation, what would it look like for a customer to be automatically enrolled in these programs, from your perspective? And once the Councilwoman says her perspective, I would love to hear your feedback. VICE CHAIR LANDAU: Yeah, I think you can have one joint application program that can get you in all of them. I mean, the TAP program doubled enrollment, right? When it automatically enrolled people. And the other thing is you can automatically enroll people and they can opt out if they want to. It's the same thing we say about our low-income housing programs as well. Put everybody in the program, let them know they're in and say, if you want to pay us more, you can, but right now you're in here, and we -- and we don't have to have people go through the -- CHAIR THOMAS: Can you guys give us your thoughts on that suggestion, please?

So I think on the intake side, if someone else has done the income verification and we hope that all clear, that is fantastic. That saves us all a lot of work. It is a question of us sharing someone else's income information and their PII that sometimes can be a hurdle. And we're working on that. VICE CHAIR LANDAU: Can't you just share the fact that someone is eligible, not their income information, but if they're income- eligible for one thing in the City of Philadelphia? There's a lot of things that could be. Isn't that enough, the proof and the verification? CHAIR THOMAS: So I've learned some of your limitations the hard way, right?

Yeah. CHAIR THOMAS: And so, this is -- let me ask this question, and in collaboration with Councilmember Landau, if there was a third party, i.e., I don't know, the City of Philadelphia -- VICE CHAIR LANDAU: BenePhilly. CHAIR THOMAS: Yeah. And this third party was coordinating with all of you, would there be an appetite to do what the Councilwoman said? Because again, my original question that I've asked every group was, what does it look like to rethink our approach as it relates to utilities, right? Your limitation on being able to share information is why I want us to go sit at the table and revisit how we do this. Because on the one hand, I understand wanting to protect people's privacy, but sometimes the same privacy that we're looking to protect ends up being the reason that that same person gets hurt, right? And I think the Councilwoman has identified an example, whereas though you're trying to protect people's privacy and it limits your ability to have that efficient communication. But if we can bend a little bit as it relates to what we thought a hundred years ago compared to where we are right now, that's an example of maybe how rethinking and coordinating can put us in a position where the average person can save a ton of money. Because I can attest to what the Councilwoman is saying, the programs that you have, a lot of them are great. Most people who are eligible for the program don't know the program exists. And so if I automatically were eligible, right, who's going to say, ah, I paid you a little bit too much money this month, I think I need to opt out of this. No one is going to do that, especially people who are struggling. So talk to us a little bit about your thoughts, and I want to allow Councilmember Young to ask his questions as well before we go to the panel. VICE CHAIR LANDAU: And before, I want to also -- at some point, have you do the math on how much it costs you to go through a shutoff process. Because if you can automatically enroll people and they are automatically in a program they can afford, you will save money on the other end of the shutoffs.

Absolutely. A customer that gets into arrearage, a customer that goes through that process becomes a very complicated, expensive customer to serve. A customer that can stay current on their bill is a really easy customer to serve. And, you know, that's where -- you know, I know, in a city with as much poverty as Philadelphia has, there's kind of never enough in terms of resources, but over $200 million is a lot of money that is available to CAP customers. And most customers who are on CAP do stay full and current on their bill, the vast, vast majority. And in terms of your question, Councilmember Thomas, I will confess, my knowledge on the details of our program enrollment probably goes about 80 percent. I think to answer your question, you need somebody who can go all the way to a hundred. So I will go back to our program experts and share this. CHAIR THOMAS: And we're going to keep revisiting this conversation, right? This is just the first. I'm the Chair, Councilmember Landau the Vice Chair, Chairman Driscoll is a big part of this conversation. Like, we're definitely going to revisit this because when we look at the affordability crisis in the city, we can't control everything as local government. But in the places where we can step up and put a little more skin in the game, we definitely want to do so. And based on the conversation that I'm hearing today, it sounds like you all have an appetite to do so as well too. So I think that's the blessing out of this. Let me let Vice Chair Landau wrap up so I can pass it to Councilmember Young, and we can move on to the last panel. VICE CHAIR LANDAU: So I look forward to following up with you on this. As the Chair of the Tech Committee, there are some, I think, really easy answers that will make everybody's lives easier. But I have one last question for PGW. You were allocated $500,000 for a geothermal feasibility study in 2022 operating budget. What's the status of that study? Is PGW planning to implement or pilot any gas-free energy projects in the near future?

So with respect to the geothermal, I'm probably not the right person to answer the question. But certainly can carry that back. VICE CHAIR LANDAU: Okay. Thank you. I look forward to -CHAIR THOMAS: Thank you. Thank you for your honesty. Chair recognizes Councilmember Young.

Thank you, Mr. Chair. I think my question is on the line, similar to Councilmember Thomas. When we -- we have the ability to figure out how to lower costs for everyone, and I know our state law allows us to waive, like, late fees, so is -- what's the -- I guess the appetite for some of -- for PECO or PGW to kind of help us lower costs for our constituents by waiving these late fees? And what do you see is the -- I guess -- or what benefit do you have or do you see by keeping late fees on bills?

So for customers who get on our Customer Assistance Program, CRP, we don't charge late fees. So it's essential that a customer who really, you know, has a very limited amount of money to spend every month gets on that program because even if they miss a couple bills, they can catch up on them later. CHAIR THOMAS: But Councilmember Thomas just talked about how sometimes -- or you know -- because it's not an automatic enrollment now, right? Or sometimes people feel shameful about reaching out to try to get into these programs. I think we're just -- as a policy maker, as a policy -- as a baseline, I think what I'm getting at is trying to figure out what we can do as a municipality to help lower those costs, those everyday costs for people. I mean, my wife just said our gas bill went up $60 a month. You know, I heard a bill 22 went up a hundred dollars a month for her. So it's like -- you know, she pays the bills, I don't pay the bills. But she -- you know, she notes that these costs are rising, right? So, like, what can we do to help Philadelphians keep costs down? And I think that, you know, trying to eliminate late fees are a way that will actually keep costs down for Philadelphians, you know, and throughout, you know, the region. Again, our state law allows it. And just wanted to see if it's something that you guys would want to consider.

And I want to go back and confirm what I'm about to say, but it's my understanding when we sign a customer up for CAP, that usually very often involves arrearage forgiveness. And the arrearage forgiveness can include the late fees. And I want to go back --

That's just CAP. So CAP does allow for the low-income, or your 150 percent of poverty or whatever I think it is, that's just for that program. I think I'm asking for, you know, all customers essentially, but again, because folks who may be eligible for the program aren't in the program, right? Because there's no automatic enrollment in the program. So I think that if we're talking about lowering costs, which that's the point of this hearing, right? I think that's a way where we can lower costs for our residents. It's not -- again, I'm getting at what is -- like, how much will that cost you all to do that? Like, is that that much of a burden and lift to eliminate late fees, that it's going to have a substantial impact on the operations of your entity?

I don't have the number of what the late fee collections are for the year. We'll go back and get that for you. If a customer previously didn't apply for CAP and wasn't aware of it and was behind on their bill and called us up and said, you know, “Do you have programs to assist me?” We would try to get that customer onto CAP and part of getting them onto CAP would be -- you know, arrearage forgiveness would be, you know, part of that. CHAIR THOMAS: Can you give us -- can you give us an idea of what percentage your profit margin comes from late fees? Is that something -- and I know you can't give it to us right now, but is that information that you could get back to us? Because we're going to continue this conversation, and so as we work together and think about it from a regional approach, are those numbers that you can give me as it relates to what the Councilmember is asking for? Is that fair?

Yeah, we -- CHAIR THOMAS: You don't have it right now, but is it numbers you can get to us? And as we continue to examine -- because we're going to take Steve up on the offer to visit. I think that's important. I think, Steve, I appreciate the gesture. I think that if we're going to do a deep dive into this issue, it's important that we understand the entire gamut. So I think your offer is important, and I think in the midst of us continuing to work together as a region, if we can get those numbers so we can explore the impact that that has on your economics. Because we understand the impact it has on the economics of the constituents. That'll be appreciated.

Okay. Yes. We'll get those numbers for you.

Thank you. CHAIR THOMAS: Thank you.

Thank you. CHAIR THOMAS: Thank you. I just want to say thank you all for being here. Thank you for being open. This is an important dialogue. You provided so much great information, not just for us, but for constituents across the City of Philadelphia. And we're going to call one more panel and we have a few people to testify for public comment. We would just ask that you listen to the folks who come for public comment because they're coming really to talk more to you than us. So thank you. We appreciate it.

Thank you.

Thank you. CHAIR THOMAS: Ms. Clerk.

Next we will hear from Ali Perelman with Build Philly Now, followed by Rich Freeh, Vikram Patel, and Emily Schapira. CHAIR THOMAS: Some great crew. We have four chairs, so we're good to go. And I think we have about nine people for public comment, and so we want to make sure that all those folks get an opportunity to communicate their public comment as well too. So thank you all for being here.

Chairman Thomas, with that in mind, would you like us to expedite, or would you --

I was glad to get to expedite. CHAIR THOMAS: I mean --

Okay. CHAIR THOMAS: So we have all of your written testimony that's been submitted. And I know all of you, and I know that you all are intelligent folks, and I think if you could paraphrase your testimony, but then also provide perspective on some of the things that you heard as well too, because I do think that we got a lot of information. I've seen some of you nodding in the back as information was being communicated and I've seen some of you shaking your head, “no,” as information was communicated to us. So this kind of gives you the opportunity to not just provide your testimony, but to also offer a perspective that might be in agreement or different from something you might have heard. So whoever wants to go first, you may state your name for the record, begin your testimony. We want to let the entire panel testify and then we'll open it up for questions. So please, you may begin.

I'll go first. Good afternoon, everybody. I'm Emily Schapira, president and CEO at the Philadelphia Energy Authority. We're actually a quasi- government entity, so I'm happy to actually testify with the advocates today. I will not repeat my testimony that's on the record. You guys have it. I've tried to give you a handful of really specific things that City Council can actually do. I'm going to list them real quick because I know some of them are not on everybody else's lists. So the first one is energy efficiency design standards for city programs. Any place that we put a city dollar into a program, whether that's basic systems repair, the Rental Improvement Fund, Restore, Repair, Renew; places where we're doing a great program that provides a great benefit. The thing we do not want to happen is that we will build new construction that meets only the basics of already outdated building energy code and recreates the same issues that we have today as these buildings age. We don't want to continue to replace old inefficient heating systems with new inefficient heating systems. We don't want to restore roofs without insulating attics or applying cool roof coatings. And we keep doing this and we're spending, as you heard from the utilities and from many others, millions and millions of dollars in what unfortunately can become stopgap measures if we don't take a smarter approach to this long term. So that's my first recommendation, is design standards across all programs that receive city funding. Also, I think we forget that when we do this sort of return on investment calculations or cost- benefit analyses, we're looking at the return to the city or the vendor or the utility. So for example, utilities are kind of bound by what types of measures they're allowed to do or weatherization is bound by what types of measures they're allowed to do because it has to have a payback. Well, in most cases, the payback goes to the homeowner. That's the generational wealth. And so if we're insisting that we can't do programs that don't pay back to the utility or don't pay back to the city, we're missing that opportunity to create that generational wealth and restore that generational wealth. So, again, energy standards are a very simple way to do that. Don't believe the skeptics here on how much that costs. I think we hear that all the time. That's an old issue that is no longer the case. Sometimes there's a little bit of a premium there, but we can change our systems and change the way we implement things to make sure that that cost is minimized. And happy to share more data with you guys on that. We've now done -- 430 homes are complete with Built to Last. So we have real cost data from homes across the city, so we know exactly how much all of this costs here in Philadelphia. Council should also support energy-efficient design standards for city-owned buildings. We have an ordinance that says new construction must be made to LEED Gold certification standards. A lot of buildings get waivers, so that's something Council can be requesting from the administration. But even those that don't, these are just new buildings. We don't have requirements for retrofits of existing buildings, and that's what happens most of the time. And as we've gone to do energy efficiency work in big city buildings and small city buildings, we see that we are not able to spend enough at the city to maintain those buildings to a quality that is not just completely wasting money on energy. And all of that contributes to everybody else's costs going up. The second category of things I want to talk about real quick is regulatory engagement. So you heard a little bit from the Office of Sustainability. I'm sure you-all individually have heard this from PEA as well. But there are all sorts of things going on at the Public Utility Commission that need our attention and hopefully our intervention.

We participated in rate case interventions before, intended to do so on PECO's latest that was withdrawn. But there are also other issues at the Public Utility Commission that without the perspective of a big user like the city and an implementer like PEA, they're missing opportunities to understand how those rate -- that rate-making and how that regulatory discussion affects actual people. And I think we talk to people like CLS Community Legal Services all the time about that intersection of affordability, short-term affordability, long-term and technology and data centers and all of that. And so we need the resources to be able to engage. The city doesn't have any specific team that is focused on that engagement. So that is something that we've embedded in the PEA FY27 budget request as well. The third thing I just want to mention is about solar. And I want to be clear, everything we heard from PJM and from the utilities is about getting large- scale, utility-scale energy onto the grid. As everybody mentioned, that takes many years. It's not a quick process. And PJM has been -- has had things under review. The queue is now moving again, which is great. But what doesn't need that level of review is distributed energy resources. That means everything that you put on your rooftop, on a small local building, on your house. So we've already completed 4,400 solar rooftops in Philadelphia. Over 55 percent of those are low and moderate-income homes. So we know this works. It is our best tool for long-term affordability. You do not end up being subject to the whims of politics or global affairs or data centers or all these other things because you have a fixed asset on your roof that's generating your own power. It also saves money to the grid. So there's tons of data now that we didn't have just a few years ago showing that DERs like rooftop solar are providing huge efficiencies to the grid that makes everything easier to operate. And the last thing I'll just highlight, which I know we've talked about, is City Council's role with data centers. This is a very big deal. I know you know this, but I want to flag it. If you leave it to the universe rather than taking some action, it will not be what we want it to be. Data centers need a load of 500 megawatts per data center or more. That's like putting another city of Philadelphia on top of the city of Philadelphia. It's an astronomical amount of power that does not currently exist. And so what we can do as a local governing body is create data center zoning requirements. That is something that we have the power to do here. And we can require that data centers bring their own power. We can require that it be a low-polluting power. There's certainly a role for different kinds of gas engagement. There's certainly a role for all sorts of different kinds of renewables, from geothermal all the way to distributed solar. And actually, because of the cost for data centers to delay, they're happy to sort of hear good rules from local governments. And we know this because we talk to data center developers who are telling us, yeah, we expect that there will be years of delay. Every place we want to build one, we expect to have to go to court. We understand how complex these issues are. And so they're eager for cities to say, here's the rules, and if you can meet these rules, you know, you're in. That makes it much easier for them. So I want to encourage City Council to take the time to get this right and to figure out how we can create local benefit so that we are not recreating the same environmental justice issues that we've had for 150 years from the refinery. And I'll leave it there. You have the rest of my testimony. PEA is as always at your disposal. We are happy to provide data, research, bring in experts, help craft legislation, whatever is needed for Council. We're available to you. Thank you. CHAIR THOMAS: Thank you. Very informative.

Thank you for your testimony and thank you for your service.

Excellent. Speed run. Okay. There you go. Good afternoon, Chairman Thomas and the members of the committee. I'm Ali Perelman, the executive director of Build Philly Now. I'm also going to do an expedited version of this testimony, which is on the record. Just to highlight at the top, I believe it has been noted here, but sort of the high-order question of what is causing this affordability crisis can be very easily distilled down to a supply-demand issue. One of the points that I think was alluded to here, but I just wanted to sort of like state much more clearly, it comes up in the conversations that we have around the cost of additional power when we had, for example, the cold spell in January and February. The issue there is that the additional kilowatt hours which are required to heat people's homes at that time are the most expensive electrons you can possibly buy. PECO has to buy them because they have an obligation to be reliable to us, the consumers. And so they have to pay more -- much, much more in that moment so that we can pay -- so that we can heat our homes. And the nature of that as an energy market is a very interesting question. It's unlikely to change even if PJM itself sort of is reconstituted in some form or fashion. The only solution there from a practical and realistic perspective -- and I know that this has been highlighted a number of times during this hearing, is increased supply. So that when you do have a situation as we did in January and February, where -- especially as we're going to have -as I think we would all anticipate, more extreme weather moving forward, in those moments, the electrons which are the most expensive electrons in a comparative sense aren't in an absolute sense as expensive as they are now. And so I would just have a sort of like maybe a foundational concept that we're all thinking about here, how do we make like the most expensive power much less expensive than it is now? And the only way to get there is through supply. Number two, I do want to touch on data centers a bit. I know that this is sort of like the -- I don't know, maybe the most hot-button of all of the topics we're discussing today. Just to provide -- maybe sort of taking a step back and provide a little bit of context around data centers. Like, as a place to start, like where we're physically situated here right now is within like maybe eight to ten blocks of half a dozen data centers. Like, they're not new and they're already here. They look very different than the hyper- scalers that Emily is talking about. But data centers are why we can operate in an online way to the extent that we do. So if we were sort of just to think about this in terms of like points in time or eras, when the internet first came online and there were like things called websites and we sent things called email, there was an enormous boom at that point in the first iteration of data centers to make all of that possible. , at this point, there's somewhere around 5,400 data centers. S. were built in the late 90's and early 2000s, just to get us online, like as a starting point. The most recent boom, during which it was actually like a more significant increase in the need for computing power, was, you know, much more recently in the 2010s when things like streaming came online. Just like the total compute demand for the sorts of things that we're doing online now, as compared to what we were doing before when we were probably just shopping online, is so significant that I don't want it to kind of get lost in the weeds here. Like, we've already made these transformative transformational leaps in how much compute all of us as consumers are demanding every day. Obviously this third iteration, right, is the AI iteration, where we're talking about a different -- like a materially different type of data center. These are going to get built.

And I think the question that we're sort of all grappling here with today to a large extent is where do they get built and under what conditions, right? Just to wrap up as we're thinking about things that we can do prospectively, I mean, the point of the hearing was to address this question of affordability and, you know, promote and presuppose that there are solutions on the table. The supply- side stuff ultimately, I think, is like the goal of all of what we're doing here that just sort of can't be avoided. I think that where I'm most interested and intrigued in thinking about how we get to a supply-side solution in Philly is thinking about like where all you would put that and what it would look like, even recognizing the fact that we're on a grid. I've talked to many of you in this room before. You know, I'm evangelical about the possibilities of re-industrializing lower South Philadelphia. I think that maybe could be the topic of another subsequent hearing, talking about all of the opportunities that exist down in lower South. To do my lower South pitch: lower South Philadelphia is the only place in the United States with a top-20 airport, top-20 marine port, interstate highway, rail, and extinct gas lines that also has a microgrid in institutions of national security importance. So there's just an almost unimaginable opportunity down there for doing a lot of the innovative energy work that is going to -- we're all nationally going to need to invest in to solve this problem. And also, from my perspective, maybe more interestingly, what if the power generation that facilitated a massive redevelopment in lower South happened in lower South as part of this sort of like new way of thinking around what power can look like, what power generation can look like, I think especially in cities. So with that, welcome any questions and thanks.

Good afternoon. I'm going to go slower, I think, right? Can I do that? Just kidding. So good afternoon, everyone. My name is Rich Freeh. I serve as the executive director of Green Building United. We're a regional, right? It's what we're talking about today? Nonprofit based in Philadelphia, a block or two from here. We have a data center on our floor. I think Verizon is on our floor, 16th of Market. We are on a mission to advance an equitable transition to a climate-friendly, healthy built environment. So grateful to Councilmember Thomas, Councilmember Landau, everybody who is here today for convening this conversation, for being here today. This is a great discussion. It's great to come sort of at the end because a lot of the things that I had written down have already been mentioned in various ways. But I am going to emphasize a couple of pieces, add a few things that have not been mentioned quite yet. I wanted to go back to a couple of the things that were mentioned at the outset of this hearing. I think Director Lankenau mentioned the idea of energy burden. I just wanted to give that statistic one more time. Low-income Philadelphians spend almost 16 percent of their household costs on energy, 16 percent. That is a number from a couple years ago. As we've all heard, energy bills have gone up, wages have not. So we know that number is higher. 16-plus percent energy burden. And I really appreciated the way that the Mayor of Camden started this discussion, right? Energy affordability should not be a privilege. It should not be a luxury. It should be available to all Philadelphians. And we should particularly be prioritizing our lowest-income neighbors as we're thinking about these policies today. To that -- and I'm really proud Green Building United is a part of the Here 4 Climate Justice Coalition who's here today, who spent all morning at the Gas Commission hearing, advocating for some changes to their budget. I'm not going to talk too much about that stuff today. But I know you-all are already hearing from Here CJ and are engaged in those Gas Commission hearings. And I think the speakers today did a really good job of laying out the challenges, laying out some of what's already working. So I wanted to give a couple of really tangible opportunities that are, I think, available particularly more on the reducing-demand side. Because I hundred percent agree this is both a supply and demand challenge. And I think my job is to bring some of those tangible solutions and also recognize -- you know, I think the speaker from Penn, you know, talked about sort of, you know, the projection of higher electricity costs going up to 2050, right? And I'm here to say that's not inevitable. That is a choice, right? If we have higher electricity costs in the future, that is because we have collectively decided not to take action to increase supply and to reduce demand. So we have an opportunity here today. I a hundred percent agree with Rep. Fiedler, right? That there's work that needs to happen at the federal level and the state level. But there's also opportunities right here at City Council today. So I'm going to talk about a couple of those. The first, one of the best ways to tackle energy affordability; ensuring that our homes are built to strong, durable energy codes. E. We know that there are programs already, particularly Built to Last, that are doing a fantastic job of this. But these are also -- these are big programs or expensive programs. So what are our opportunities right now? All new construction and major renovations are governed by our Building Energy Code. There is a bill right now thanks to Councilmember Driscoll, who will be leading these hearings a little bit later this month on Bill 11 644, to update Philadelphia's code to the 2021 International Energy Conservation Code. GBU strongly supports this bill. We've got to pass this.

This is going to help reduce energy bills right away for everything that's built or renovated starting on July 1st, 2026, up to 10 percent energy reductions after that bill has passed, which we hope that it will be. But it leaves out some key provisions, which you all have heard from us already. Particularly around continuous insulation. We'd love to see Council take action to bring those requirements for insulation back in. You heard Rep Fiedler talk about this already. Every dollar that you spend on insulation, you see come right back. And to Emily's point, you know, those are dollars, that it is true a developer or a builder is putting those dollars out. The dollar saves are going to come back to residents, right? So that's a really -- that's a really key distinction. You get pushback on that. We understand the concept of first cost, but there are real savings there. So there's an opportunity to do further work as soon as this fall to bring those continuous insulation requirements back. E. Also important to note, that's going to bring us back in line with our peers. So in New Jersey, in Delaware and Maryland, they all already have the working- on-2021 or 2024 codes. They already have continuous insulation. This is not some crazy wide-eyed liberal whatever, right? This is -- we're seeing it right now in all of our neighbors. We are behind. Council can bring us back to -- in line with our peers. So that's one big thing we can do right now tackling energy affordability, and that's going to help with our smaller residential buildings. We can also cut demand by setting standards for eliminating energy waste in bigger buildings. Council has been a leader on this for years, passing the building energy benchmarking and building performance programs, which require large buildings to report and disclose their energy use and for commercial buildings to tune up existing systems. , and others as well around the country. These programs will push building owners and operators to embrace already- existing technologies. So you heard Director Lankenau talk about cool roofs, talk about heat pumps, talk about solar, again, weatherization. We can bring systems up to a good state of repair. We can make long-term investments in our buildings. These are going to have immediate and long-term energy savings for tenants, whether those are small businesses, whether those are residents in these buildings. A well-designed building performance standard will reduce costs, can include metrics for reducing that energy burden that we mentioned, and could include funding, or if there's fines associated, those funds can go directly to programs that Council ties to energy affordability goals or that are outlined through the energy poverty alleviation strategy that Director Lankenau mentioned earlier. And then lastly, just wanted to reiterate and emphasize what Emily mentioned about data center regulations. Data centers, these hyper-scalers, they are coming, right? They are already in our region. Green Building United is a membership organization. Our members are designing, operating, building these buildings. And they are leaders on looking for, whether it's putting certifications in place, whether it's bringing your own energy. We can be a resource in helping to design what those standards should look like in Philadelphia to avoid having the status quo that we are unprepared for from an energy standpoint and an affordability standpoint. I will leave it there. Looking forward to the discussion. Thank you again for the opportunity to testify. CHAIR THOMAS: Thank you. Thank you for your perspective. If you could state your name for the record, you may begin with your testimony.

Thank you everyone. I'm Vic Patel. I'm the managing attorney of the Energy & Utilities Unit, Community Legal Services. Now, the Energy Unit at Community Legal Services, we're one of the -- CHAIR THOMAS: You've got to say your name. I know it, but -- no, he said, I'm the managing -- say your name.

Oh, I didn't say my name. I'm Vic Patel. CHAIR THOMAS: You good. Go ahead.

I'm Vic Patel, and I'm the managing attorney of the Energy Unit at Community Legal Services. And we provide free legal services to low-income Philadelphians who are facing utility shutoff or are having issues with accessing a -- you know, a utility affordability program. We also represent at the Public Utility Commission -- and that's going to be what I'm going to talk about a little bit later. We represent at the Public Utility Commission on behalf of low and moderate-income Philadelphians because, you know, access to safe and affordable utilities are necessary for all Philadelphians. If you don't have safe and affordable utilities, then it undermines every other aspect of your life. And we see that every day with the people that we work with. We see families that come in who get shut off, who then don't have the ability to refrigerate their medication. You know, we have elderly clients who then can't run their medical equipment. It's incredibly disruptive for -- you know, for our residents of Philadelphia when they don't have access to utilities. So when we think about what the city can do, it's good to understand how the Public Utility Commission works. Because being -- before being in the Energy Unit, I had no idea. It looks opaque from the outside. But it's actually very similar to, you know, other large judicial proceedings. So, first thing, when a utility that is regulated by the Public Utility Commission wants to raise rates, like PECO or PGW, they file a rate case. Basically, what they do is they file, you know, a request for a general rate increase, which will include something that justifies that rate increase. So that could be increases in, you know, their capital investments, increases in their operating costs, or for investor-owned utilities like PECO, that could be, you know, a requested rate of return for their investors. So then statutory advocates like the Office of Consumer Advocate, Office of Small Business file complaints. And, you know, other parties can file 3 complaints or petition to intervene. And this is usually where we get involved. You know, we file -- either file a complaint or a petition to intervene on behalf of an organization that we've been working with for a long time; TURN, the Tenant Union Representative Network. This is also when the city has gotten involved in the past, this is where they get involved, right? They file a petition to intervene. Then the Commission has an order that -- to -- an order to investigate the justness and reasonableness of the rates. So that is -- that is the legal standard. You know, rates have to be just and reasonable. And then that gets assigned to an administrative law judge. And from there, it's, yeah, very much like a judicial proceeding. There's discovery, there's cross-examination of witnesses, there's briefing, and potentially also, often, negotiated settlements. Then that goes to the ALJ, ALJ makes a recommended decision that then goes to the Commission, and then the Commission makes a decision. And if the parties aren't satisfied with the Commission's decision, then they can either ask the Commission to reconsider or appeal that to the Commonwealth Court. Now, these cases are very, very complicated. You know, the written testimony is like hundreds of pages long. There's financial projections, tons of spreadsheets, but the impact is incredibly high, which is why we, even as a like small legal -- I mean, as a legal services-type organization, much smaller than the utilities that are involved in this, with far fewer resources to put into it; that's why we get involved. These cases involve enormous amounts of money that will affect our clients. Like the case that was just withdrawn, PECO was requesting $429 million annually to its increase. So hundreds of millions of dollars. So when we think about what the city can do, first, right, is challenge utility rate increases at the PUC.

The city, you know, sometimes does get involved -- Emily already brought this up -- get involved and intervene at the Public Utility Commission. But often when the city gets involved, it's, you know, as a large user -- large users get to intervene in these cases fairly often. Like, you'll see Walmart or the University of Pennsylvania. So the city is a large customer. So they often intervene. Or they're also thinking about specific programs that are related to PECO's operations. Like, I remember Emily, PEA was working on interconnection and also coordination with weatherization programs during the last rate case in 2024. So investing in expert witness testimony, it's a small investment, but because these cases are so large, it can have a significant impact on reducing the rates that Philadelphians pay. Real quick, I'm going to talk about -- Denise brought up, you know, the low-income programs like CAP and CRP that PECO and PGW have. You know, they are incredible programs. But as Councilmember Landau brought up, and also Councilmember Thomas brought up, you know, they aren't necessarily the easiest to get into. They are significantly undersubscribed, meaning that there are many more people who qualify for these programs than are in them. CHAIR THOMAS: So can you summarize, because we've got a couple questions for you, and I don't want to keep people too much longer. The stenographer is getting a little --

Yeah. Well -- so -- well, I'll say -- the last thing I think I'll say then -- well, two quick things real quick. One, Councilmember Landau brought up LIHEAP data sharing. One point is that DHS actually redid their LIHEAP applications, and there is a checkbox; a checkbox on the application where you say, “I would like my data to be shared with the utility.” So there doesn't need to be any extra steps. If there are extra steps, you know, it's on the -- it's on the utility side. So then the last thing I'm going to bring up is that, in addition to being at CLS, I'm also on the Cost of Living Task Force. And the Cost of Living Task Force is going to be putting out a report including a section on utilities. So I suggest that everybody check that out when it comes out. Thank you. CHAIR THOMAS: Thank you. We definitely will. Thank you all for your testimony. A couple quick questions. So we talked earlier about automatically enrolling people. Clearly you communicated your opinion on that. Councilmember Young earlier talked about eliminating late fees. Do you guys think that eliminating late fees will put people in a position where as though -- I mean, you deal with the clients. What would that look like? I mean, systemically, it would definitely create some hurdles and some issues, but just give us like a quick 15, 30-second response. Anybody can answer. It doesn't matter.

I can talk. Oh, wait, does anybody else? Okay. I can talk about that real quick. I mean, when we look at our clients, you know, late fees, like the people that we see who are accumulating late fees are the ones who are least able to deal with them. And, you know, people don't pay their -- people that we work with, they don't -- they don't pay their bills, not because of, you know, any choice, right? They have to make tough choices. And so essentially, you're just punishing people for being in a cycle of poverty. CHAIR THOMAS: So when you're representing a client, and you negotiate on their behalf to get something turned back on or something like that, do you find it often that the utility company waives the fee when you're representing them? Or do they tend to not waive the fee?

So -- CHAIR THOMAS: The late fee, I'm sorry. The late fee.

Yeah. So when -- they are required actually to waive them when they're under a certain income. But otherwise, not so much. CHAIR THOMAS: So I see folks from PECO still here listening. Is anybody from PGW here still? Okay. Somebody from PGW is still here listening. So they hear your testimony. I want to say thank you. Before we let you guys go, I want to ask you the same question that we asked the other panels. And I think this is what I'm really pushing for; a hundred years ago, right, there was a regional approach to address this issue, and a hundred years later, right, we're really struggling as it relates to this issue. And you've listened to a lot of different reasons why, and you all have expert opinions on how we got to where we are. Do you think that it's time for us to have a -- to revisit the regional conversation around PJM and look at what does it mean to -- what does the cost of energy mean, and revisit what it looks like for government to work together with some of these different partners and sectors to rethink how we imagine charging an average everyday person for an energy bill? If you don't want to answer it, you don't have to, but anybody who wants to, I would love to get your opinion before we let you go.

Sure. I'm happy to answer that question. The structure of PJM I think is not necessarily the problem. I think it's helpful to remember that this industry is cyclical and that it's not been sort of a then-and-now situation. Over the course of the last hundred years, there have been a lot of different kinds of supply and demand spikes. I thought Ali put it really well when she sort of explained that. CHAIR THOMAS: It was a great lesson, the history lesson. I agree.

Yeah. And, you know, I think it requires active participation. And I think we're hearing this from CLS, we're hearing this from GBU, that we as a city are not just a large user, we're also the steward of all of our residents, all of our businesses. And we've not always had the resources or been allocating the resources to take that seriously. And so I think what needs to happen is there are some PJM actions we can take. And I think PJM is receptive to that as we heard, and wants to be engaged. The city does participate in an advocacy group of other cities, particularly around large user issues, but not necessarily around other types of issues. PJM has had a backlog in their queue for many years as they've been trying to figure out the right way to sort of get the right mix of things into the system. And so I think we have two options there. One is we can do some advocacy with PJM to figure out, here's the things we need. You saw Governor Shapiro trying to get at some of the capacity issues. These are highly technical, not easy-tosolve problems. And so I want us to stay really cognizant of what we actually can do and can influence and what is sort of out of our ability to influence. But there is a lot that we can do. The second thing is to really invest in those distributed energy resources and really be thinking about -- and I think this is something that -- thank you -- something that we should continue to talk with the sort of re-industrialization advocates about. Because we really did suffer 150 years of having one of the highest asthma rates in the country, particularly in an inequitable fashion. So among African American kids, you see a rate that is two to three times the asthma rate of white kids in this city. And we don't need to replicate that. That has been done. And so we're on a trajectory that can do better than that. And we should, and we can. And I think we have a municipally-owned utility, which most other folks don't, and we have an awfully big one that has a lot of opportunity and a lot of responsibility. So we should not let those resources go. And I think Ali also mentioned that lower South district that's got so many resources. CHAIR THOMAS: Yeah, I heard lower South multiple times, and I think some of the context around the potential down there, I think that that was very intriguing. I didn't -- I didn't know all of that as it relates to that particular part of the city.

Yes to everything Emily said. And just to sort of take maybe a little bit more of -- I don't know, opportunistic perspective, Pennsylvania is the second-largest energy exporter in the U.S. I don't know, speaking from my own perspective, sometimes I find it very difficult to be like bullish on the Commonwealth for any number of reasons. But in terms of energy production, this is actually something we do pretty much better than anyone other than Texas. So I think it would be critically important for -- and this is sort of like an in-order-of-operations sort of way, number one, as part of this conversation, and the Governor has already made this very clear, that any discussions about sort of like reconceptualizing PJM, keep in mind the fact that there is like one state that's like -- basically has everyone else's back in the grid when stuff goes wrong. And No. 2, and I think this is the much heavier lift, all things considered, making sure that Philly specifically doesn't get left out of that conversation because we are not currently an energy producer, even though the Commonwealth is. So wanting to make sure that -- and I think this is to Emily's point, the most important factor, making sure the fact that our municipally owned utility is viewed as part of the Commonwealth's energy generation. Even though it is a utility not generating any of its own power, it has a very high level of capacity that it's viewed as sort of like a net asset in this broader conversation. Pennsylvania really is -- we are so rarely like in the catbird seat for anything, but we really are in this context, and it'll be a tremendously missed opportunity if we didn't figure out a way to capitalize on that. CHAIR THOMAS: That's a great responsibility for us and a lot of homework. I want to say thank you to this panel. VICE CHAIR LANDAU: Thank you so much. CHAIR THOMAS: We truly appreciate you. We want to allow for public comment, and I know folks are getting a little tired. There was a hearing earlier this morning. Did you want to add something?

Yeah, I'll just briefly say one piece to that question. CHAIR THOMAS: Sure.

Because I really appreciate it as a regional nonprofit. And I think though the way that Ali put it was well put. Another way to think about that, from Pennsylvania's role as an energy producer, if you look at a map of the Northeast, there are some maps with a big donut of Pennsylvania, and those are maps of the Regional Greenhouse Gas Initiative, which is our regional cap and trade effort here in the Northeast. This is something that Pennsylvania for many years, folks in the Democratic legislature have been trying to get us to enter. Governor Shapiro withdrew us from that as part of the budget negotiations last fall. Pros and cons to that, but one of the big cons is that Regional Greenhouse Gas Initiative proceeds are a tremendous source of revenue that can help with all of the demand-side reductions that we've talked about this afternoon. So if you're looking for -- as Rep. Fiedler was talking about, big chunks of funding, that can help prepare homes, weatherize, create clean generation and renewable energy in Philadelphia for our residents and across the state, RGGI is an opportunity to do that. Governor Shapiro took that off the menu. So I think the question to Harrisburg is: What is next, right? Is there another opportunity to generate that revenue? Whether that's looking at RGGI differently next time around, whether that's through another program, and there are elements of the Governor's Lightning Plan that I think are important to look at. But I would just say a hundred percent, I think your frame around, you know, we should be looking at this as a regional strategy going forward, we're very aligned with and happy to support those conversations. CHAIR THOMAS: Thank you all. I can assure you that this is not the last conversation. Your perspective is very much appreciated. We'll definitely be following up as it relates to next steps that City Council will be doing as a collaborative approach to this regional problem. With that being said, Madam Clerk is going to move into public comment. Everybody who's here for public comment, I want to first and foremost say thank you for your patience. We appreciate you waiting. I'm sure you were able to collect a lot of information just like we were, as well as the listening public, and we are excited to hear from you as well. So, Madam Clerk, can you please start with our first person for public comment? When you're called for public comment, please state your name for the record before you begin with your testimony.

Will Asray Gray, Eric Stowers, and Linnea Bond please make their way to the table. Will Peter F. Please make their way to the table. VICE CHAIR LANDAU: And we can get started if you just state your name for the record and please proceed with your testimony. Thank you.

Hello. I'm Eric Stowers. I'm a resident of Port Richmond. VICE CHAIR LANDAU: Please proceed with your testimony. Thank you.

Thank you. First, I wanted to thank Council members for doing this, specifically you, Councilmember Landau. This is my first time engaging in something like this, and I was very inspired by your attentiveness, just seeing you engage and also press the Utilities for practical solutions. I'm a big fan of this, so thank you for your work. Yeah. I specifically want to just call out from my perspective what I'm hearing from today. I really enjoyed just learning about what's going on and the different perspectives of the panels. I'm going to be commenting on the panel for -- with PGW specifically. I have been organizing with my community in Port Richmond to oppose the LNG plant investment replacement that the Gas Commission is currently deliberating on. And I want to call out just one perspective from my perspective on what PGW was talking about. They talked about how over the lifetime of the LNG plant in my community, it has saved $4 billion over its lifetime, right? But yet they do not have the details on how much pollution they have put in my community. There's never been a no X limit set in place, even though it's been operated over the last 10 years. And in the LNG plant 11 replacement budget, they have not 12 addressed our community's health as 13 well. They also don't have basic 14 continuous monitoring to tell us 15 what's going on. 16 So they can get us 17 estimates on how much money they've 18 saved, but they don't even have the 19 details on how they're affecting our 20 community. So they sacrifice our community and don't provide the details on how much they're doing. So there's a lot of details that they are not giving and they're painting a rosy picture. Also, when they talk about the lifetime savings, they're not talking about how much costs are going to be incurred to preserve and perpetuate the fossil fuel industry and the aging infrastructure that they're dealing with. Out of the 3,000 miles of natural gas pipeline that they have in the city, how much does that risk? That's 1,500. Do you know how much PGW replaces on an annual basis? 30.

Please be aware that you have 10 more seconds.

Thank you. The aging infrastructure is estimated to be $8 billion to replace. Just because it saves money doesn't mean it's going to cost us a lot of money as well. We have to take a holistic perspective and we have to factor in people's health as well. Please do not just listen to one side of the story. Thank you. CHAIR THOMAS: Thank you. And the reason we ask PGW to stay is because there's a representative right there. So if you could have a conversation with the person communicating to us now, we definitely appreciate it.

Transparently, PGW has not addressed our concerns. They just keep on repeating the same talking points and not addressing what actually matters to us. Thank you. CHAIR THOMAS: I'm glad you put that on the record, and clearly there's issues with that community, and I'm sure that's going to come before us. So thank you. Thank you for -- we're at-large, so don't assume we know. You didn't waste your time. I had no issue -- no clue about those issues before you communicated this. So we appreciate you communicating to us. Thank you. You can state your name for the record and you may begin with your testimony.

Hey, I'm Linnea 8 Bond. I am the director of 9 Education for Physicians for Social 10 Responsibility Pennsylvania. I sent 11 a memo with six actions that I 12 believe the city can take this 13 morning -- or yesterday morning. 14 But I'm going to focus on one 15 primarily, which is -- and that's 16 been talked about a lot, PGW's 17 transition. 18 One of the things that we 19 don't really talk about, within 20 PGW's infrastructure, there's a leak 21 for every quarter mile of pipeline. 22 They talked about how gas bills have 23 gone down from 2014 to 2025. That 24 LNG facility that they attributed that to, that was built in 2002. So most of that reduction actually has to do with appliances being more and more energy efficient and people moving away from gas and switching to electric for -- heat pumps have actually surpassed gas infrastructure for heating needs because they also heat and cool. So when we look at the need to transition our gas -- like, there's fewer customers paying for our gas system when we have this leaky system with a quarter mile -- a leak every quarter mile of pipeline. And they're also not factoring in other externalities that the industry is famous for. For example, 30 percent minimum, according to the EIA, of climate change is attributable to gas. And a study by the University of Pittsburgh showed that there are 100,000 missing barrels of radioactive waste between what the industry reported leaving facilities and what the waste acceptance at the landfills reported receiving: 100,000 barrels of missing radioactive waste.

Please wrap up your testimony.

Yeah. There's 350,000 to 700,000 orphaned and abandoned wells across Philadelphia from oil and gas production. And if we continue to invest in gas, that goes up every year, right? So there are a lot of costs associated with investment in gas that were not discussed today that we really need to factor in and make wise investments in our future. Thank you. CHAIR THOMAS: Thank you. Can you make sure my team got that testimony that you were talking about?

Yeah, absolutely. CHAIR THOMAS: All right. Can you handle that for me, please? Thank you. State your name for the record. You may begin with your testimony.

My name is Peter Fasch, and the first thing I wanted to say, we've sat here for over three hours and now we're being rushed to make our testimony within two minutes. I just feel like that's a little bit unfair to the public to -- CHAIR THOMAS: Do you have more than two minutes worth of things to say?

There are so many things that were said today that I would like to comment on. CHAIR THOMAS: All right. So if you would like to take more than two minutes --

Oh, yes. CHAIR THOMAS: -- what I would ask you to do is allow the other people to testify, but before you, so that they can give -- provide their testimony, and then towards the end, we'll try to give you a little more time if you need more time.

Fair enough. Thank you. CHAIR THOMAS: Okay.

Okay. I'm going to try -- I will keep mine to two minutes. Mitch Chanin. I'm a leader in Reclaim Philadelphia's Climate Justice Caucus. I work with a number of other organizations like Two and Five People's Alliance. Yeah, there's a lot to respond to after listening for hours. I want to just name a few things that I think need reinforcement. One is that CAP and CRP programs; less than one half of the eligible customers are enrolled. So to my mind, that is a serious crisis. That means tens of thousands of people in Philadelphia, the lowest income -- some of our lowest-income residents are overpaying their energy bills because these programs are broken, the enrollment processes do not work. And to my mind, it's a huge scandal that less than half of the eligible customers are enrolled and are forced because of these administrative barriers and lack of information to overpay. That should not be happening. I support the ideas that were put forward about automatic enrollment, and I think it's urgent that that be addressed. In addition, funding for the neighborhood energy centers is really critical. I also want to say I really appreciated the testimony from Emily Schapira and PEA. Every year they didn't advocate for their own budget in this testimony, but every year the mayor proposes to cut their funding, it's resetting to $1.5 million instead of the $4 million that PEA is asking for. And I cannot fathom why that is the case. I'm glad that Council keeps putting some of that funding back. But I would like it to be just part of the five-year plan. And they need more than $4 million. These programs, Built to Last and Solarize Philly, are doing incredible work; reducing pollution, lowering people's energy bills, creating green jobs. They should be expanded. We shouldn't be just fighting to get the crumbs that they're given for this really critical work every year. Maybe the last two things, I'll try to be really quick. This conversation about PGW's future is extremely important. Many of us were at the Gas Commission meeting at 9:00 in the morning -- well, 10:00 in the morning. So we've been doing this all day, struggling over getting basic accountability and transparency. As people were saying, PGW is on track to spend $8 billion replacing gas infrastructure when we need to be phasing out the use of natural gas. And in fact, gas demand is declining year by year. We cannot saddle a shrinking customer base with paying these enormous costs. We have to have a real plan for PGW over the next 20 years to guarantee affordability and meeting the city's 2050 carbon neutrality goal. Right now, we're asking for a study about what are the alternatives to spending $182 million on this proposed LNG replacement. And we'll be continuing that struggle over the summer. Today, the Gas Commission declined to authorize that spending. That was an unprecedented move as far as I can tell. Council will be reviewing PGW's capital budget and can keep pressing for accountability and transparency from PGW. The very last thing I want to say, I think I'm probably at my time.

Please wrap up your testimony.

Okay. Yeah. This data center question is also incredibly important. I know there is a vision for building out data centers at the Bellwether District. I've heard from Ryan Boyer that they -- he would like to see a gas-fired power plant there to power these data centers. To my mind, that is just a non-starter. The neighborhood has already experienced over a century of toxic pollution from the refinery. We do not want to restart that now by putting gas-fired power plants there to put in a data center. There's a lot of other conversation that needs to happen about the proposed data center, but we cannot -- you know, the fact that Pennsylvania is the largest energy exporter, good in some ways, but it's all fossil fuel energy. We need to fundamentally transform what we're doing here. As you were saying, Councilmember Thomas, we cannot possibly allow new gas-fired power plants in Philadelphia. So that's the last thing that I'll say. Thank you so much. VICE CHAIR LANDAU: Thank you so much. I wanted you to know that I introduced a resolution a few months ago to hold a hearing on data centers and that will happen in the fall. Thanks.

Thank you. I've been meeting with your office consistently as well. Thank you. CHAIR THOMAS: Please call the next people.

Emily Abendroth, Mitch C. and Patrick Houston.

Mitch C. just testified.

Oh, okay. Can Juan Peralta please come to the table. CHAIR THOMAS: Is that the last list?

Yes. CHAIR THOMAS: These are the last three?

Yes. CHAIR THOMAS: And then I'll let my man go through one more time.

Okay. CHAIR THOMAS: All right. Please state your name for the record.

Yeah. My name is Emily Abendroth. I'm a Philly resident and I'm a member of the Here 4 Climate Justice coalition. I live in Cobbs Creek, and I live on a block that I love and that my neighbors love, but also a block where the longstanding decline in investment in public infrastructure and the stress across time on that infrastructure that was built 50, 70, 100 years ago is everywhere evident in the form of water pipe breaks, sewage backup, gas leaks, flooding basements and more. These are issues beyond the capacity of the block itself to handle or to address. In fact, I've watched neighbors sometimes do one another a favor by not reporting problems like sewage that they know are absolutely beyond the capacity of that individual homeowner or tenant to fix on the basis of their own resources. And even when people do that for one another, they do so knowing that this is by no means a true favor either for themselves or for that neighbor, and that it harms each and every one of us in the long term. In many ways, the city -- I just want to name, is also in a situation, not unlike my block, in the sense that there are conditions and situations that are of a scale that are larger than itself. However, you have far more leverage points and choices before you, and frankly, more power to change the landscape of the choices of others. And I think I just want to kind of name, like, we need you not to do us a favor that we can't afford, and that will cost us everything in terms of Philadelphia residents' long-term health, financial stability, access to housing and more. I just want to name, like, I remember a year ago now when you, Councilmember Thomas -- and this all kind of closes here, so I realize it's time -- named your commitment to hold a hearing on PGW and utilities, and that Driscoll agreed to co-host, and I want to thank you actually for following through on that and for the breadth of the way that you're taking it on. And I just want to appreciate how you expressed your own sense of urgency at that time, that the goals using a number of 2050 were themselves way too late, and that we should have benchmarks for 2030, for 2035 that are taken seriously and treated with urgency. And I want to appreciate that emphasis and hope that the thrust of that feeling is not lost along the way. And we are currently in no way on track to meet the 2050 goal, let alone like to the other; climate change, like data centers is moving exponentially, breaking new records every month, let alone every year -- VICE CHAIR LANDAU: Please wrap up your testimony.

-- and we are not. And the last thing I'll just say is like, echoing the kinds of costs where -- including when we think about these things. Respectfully speaking, PECO did not withdraw their most recent rate increase proposal out of a sudden spontaneous and magnanimous change of heart. They did so because of the direct expression of opposition by elected officials. And we really need your help. Thank you.

Hey, you-all. Good afternoon. Thanks for this opportunity to testify. And actually, I'm going to start with gratitude for this hearing as well, right off of Emily. First off, my name is Patrick Houston. I'm with the Here 4 Climate Justice coalition. I'm testifying on my own behalf today. First off, this hearing to me demonstrates that Council recognizes that energy costs aren't in a vacuum. They are not separable from the cost of food, putting food on the table, the cost of rent. This was the experience of my family growing up in Philadelphia. It was a zero-sum game. If you're paying more for energy, you're paying less for how much food is on the table. So I really appreciate this hearing. I am looking through my scrambled notes because I just want to hit on some things from today that really -- that really stood out to me. And then I want to name one thing at the end. So one, really support this call, that Council look at these gaps between enrollment and eligibility in the universal programs, both with CAP and CRP, PECO and PGW. Second, that we keep on bolstering things that work. Philadelphia Energy Authority with its Built to Last program and its Solarize Philly program, directing resources for renewable energy and energy efficiency to the households that could least afford it and would otherwise be left behind in this urgent transition. Third, yes, there's direct more resources to the other groups that are doing stuff that works, the neighborhood energy centers, the various legal services that intervene in the cases on the state level like the PUC, where they could use those resources to make sure their good work can extend all the way. And four, to support that bill that Driscoll has, 644, for upgrading energy codes. And while we're at it, making sure we make that big change on that continuous insulation, which is a really, really big difference. So those are the things that I wanted to share. Oh, my goodness. And then I'll just -- in seconds, is that okay? I'll just name this other thing. People have named the $8 billion for gas-to-gas replacement from PGW that's projected to be spent between now and 2058, $8 billion with a B. And how at the same time, with the dwindling rate base, the inconsistencies there and the inconsistencies with our 2050 climate goals. I will just name this, charting a new path forward is not unprecedented. Unfortunately, Mr. Nostrand had to leave, but Massachusetts state, their DPU Order 80-20 provides a chart on -- that -- it aims to do two things for their gas transition. One is figure out how can we transition -- do a managed transition rather than an unplanned transition. And how can we require the gas utilities all across the state to -- all across the state to have to first propose renewable, non-pipe, non-gas alternatives before they default to gas. Who can do that? In here in Philadelphia, City Council can. Thanks. That's all. CHAIR THOMAS: Great advice. Thank you. State your name for the record.

My name is Juan Peralta. I'm also a member -- my name is Juan Peralta. I'm also a member of the Here 4 Climate Justice coalition, but I'm here speaking on my own behalf. I'm a Philly resident. I'm a father of three, including a one-year-old baby. Before I get into it, I just want to just say, like, the word affordability being tossed around more and more often now kind of like upsets me because I feel like people have been struggling for such a long time. Like, I feel like the word “affordability” now being used sometimes is -- like, I remember winters where I had two pairs of socks on, sweatpants and blankets on, because the gas was too expensive. I know things are more expensive now, but it's just like the reality -- this is the reality that a lot of families have been living in for a long time. This past winter was brutally cold. And me keeping my family warm, sorry -- me keeping my family warm, my babies warm, cost me $3,000. And I don't keep my heat blasting on 80. And it just feels like -- it feels like the system is failing us. I've had this conversation with neighbors, with family members. The rising cost of utilities, there's a lot of reasons. I've heard a lot of reasons, but I didn't hear one said out loud. And that's greed. In the last year, PECO's profits skyrocketed by over 50 percent. And this is why -- this is why -- sorry. And that profit is theft. That's profit that's being taken out of the pockets of families, out of my pocket, out of Philly residents. It feels more and more that we're in a losing battle. And I come here, and I love -- I love what you said, like, some things are human rights. Electricity, energy is a human right. There should not be a profit incentive when it means shutoffs, when it means being uncomfortable, when it means possibly homelessness. So I don't know what the solution is, but there needs to be every solution. And we need to put our people first before we put the profit incentives of these corporations. And that's all I really got to say. Thank you. CHAIR THOMAS: Thank you for your testimony. That is the objective of the hearing today, right? Anybody who listened to that testimony right there, that is exactly why we're having this conversation, because we cannot put ourselves in a position where that's what constituents in our city are going through when they're trying to provide a basic living for themselves and their family. So thank you for making yourself vulnerable, sir. We know it's not easy, especially when you're a father who's responsible for taking care of other people. We truly appreciate it and you didn't waste your time. This is the last testimony of today.

Thank you, first off, for letting me go last here and spend a little bit more time, because I want to try to tie together a lot of what we heard today -- or what we didn't hear, because there were some important things that you didn't hear, especially from the industry representatives. And I want to start -- I'll just focus on PECO. So PECO stated quite clearly and quite correctly that they don't make a penny for every electron that goes through their wires. The only place that they do make money is on spending on infrastructure, right? So both PECO and PJM today only talked about building big gas plants. Why is that? Because if I build a gas plant out in Putnam County and then run wires all the way into Philadelphia, distributed all over the city, I get to spend lots of money on infrastructure, right? That's how PECO makes their money. That's why -- as Juan was saying, they've made record profits, because they're building so much infrastructure. Do we have any say on that infrastructure? No. It's all done behind scenes. They can do whatever they want by regulation of the PUC. They make -- they make a certain number of pennies for every dollar they spend on that infrastructure. Did you hear PECO talk about distributed energy resources or community solar or solar for schools or VPPs? They didn't talk about doing that. The reason they didn't is because those resources produce power locally and get -- and get used locally. PECO doesn't have to build long extension electrical lines. They don't have to put big transformers. And they don't have to spend money to support distributed energy resources. It's batteries, it's solar panels right there in the neighborhood, being used right there in the neighborhood. They don't make their money. That money that they don't spend though, gets taken off of our -- that would then come off of our utility bills because that's the distribution part of our utility bills. So they don't have to spend that money on distribution. Our utility bills go down because we're generating the power from our own solar panels, from our own batteries. And the other thing that that does -- and this is towards your question about whether we should be talking to PJM. The grid has been built, what's called for peak load, right? So it's built to the peak. So most of the time, if you look at how much energy is produced -- if you look at it over a 24-hour period, we have plenty of power over a 24-hour period. The problem is most of the demand is when it's, you know, early in the morning and it's cold, or it's late in the night -- or not late in the night, afternoons when it's hot. So we have -- we have this peak demand. And if that demand continues to grow, you have to -- you have to build more. If you can't match that demand to the supply, then you have to build bigger grids, spend more money. What DERs allow you to do, batteries in particular, is to be able to shift when that demand is and better match the demand with supply, right? So instead of building a bigger grid, the technologies of today allows you to match and shift some of that demand to later at night, turn your batteries on during the day when the power -- when more power is needed, charge those batteries at night when there's excess power. That doesn't play well with PECO. It doesn't play well with PJM, because PJM -- when you go to -- when you go see PJM out in Audubon, ask them about what their board is made up of and how transparent their decisions are. Their board is made up of the executives of the power companies that feed the grid. And you don't hear them talking about solar power either. They've got years of backlog. They have -- there's hundreds of thousands of megawatts of solar and wind power that can't get onto the grid because PJM is slow-walking the approvals of those sources of energy. CHAIR THOMAS: All right. Sir, could we --

Thank you. Thank you CHAIR THOMAS: You good?

Yeah. CHAIR THOMAS: You sure?

Yeah, I'm good actually. Much better. CHAIR THOMAS: We're going to continue this conversation. So clearly you got folks from PJM back there. We want to have dialogue about their board and figure out how we can get to the bottom of some of the stuff that you're saying. So we definitely appreciate your testimony. With that being said, are there any other questions or comments from members of the joint committees? Hearing none. There being no further questions from members of the committee and no 24 other witnesses to testify, I will ask that if there's anyone else present in this hearing whose name we failed to call, or that wishes to offer testimony in a resolution to be considered today. Hearing none. I want to thank you all. I want to thank all of the panels and witnesses for their participation today. We definitely value your opinion. This was so informative. We appreciate your patience and we can assure you that this is not the last conversation. With that being said, this concludes the business of this committee. We are now in recess for the -- at this hearing, at the call of the Chairs. Have a good day everybody. Thank you. VICE CHAIR LANDAU: Thank you. (Committee on Legislative Oversight and the Committee on Transportation and Public Utilities meeting concluded at 4:35 p.m.) C E R T I F I C A T I O N I hereby certify that the proceedings and evidence are contained fully and accurately in the notes taken by me of the above case, and this copy is a correct transcript of the same. _______________ Samanda J. Rios