PPL Corp.'s decades-long campaign to push electric heat onto homeowners has set up the Lehigh Valley, and Lehigh County in particular, for a big shock.
When the Allentown utility's electricity rate increase takes effect Saturday, it will have a disproportionately large impact on this region, according to an analysis of U.S. Census data.
The figures aren't much different in other local PPL service areas, such as Northampton and Bucks counties, the analysis found.
PPL credits its marketing for the dependency. From the 1950s through the 1990s, PPL used a variety of ways to promote electric heat, such as advertising all-electric "Gold Medallion" and "Four Star" homes as simple, clean and cheap. The company offered discounts on monthly bills, though most have expired.
It also went as far as paying home builders to install electric heat instead of alternatives, such as oil and natural gas. By one account, it pumped $25 million into such efforts over a 12-year period.
"They took care of the builders," said Lou Tepes, president of the Lehigh Valley Builders Association. "What PPL was doing was going in and locking up the development."
PPL did so even though the consensus was -- and is -- that electric heat can be painfully expensive or simply ineffective in cold climates.
After PPL's 8 percent rate increase, the average residential customer with electric heat will pay $1,527 a year in electricity bills, according to the Pennsylvania Public Utility Commission. That figure, however, includes those living in apartments; the actual expense for homeowners is significantly higher.
PPL's actions have been characterized, in numerous interviews and in a little-known lawsuit the company quietly settled out of court in 1997, as exploitative. Future homeowners after all, had yet to appear on the scene to defend their own interests.
For many, a new, mid-priced home with oil or gas wasn't an option. In the late 1980s, 85 percent of the region's new homes had electric heat. To this day, nearly all the homes in vast swaths of suburban townships, such as Upper and Lower Macungie, are electric. Converting to today's most popular heating source is out of the question. The mains and pipes for natural gas are missing, and the time to lay that infrastructure has long since passed.
Heat pumps called inefficient
In 1970, Richard Gober, an electrical engineer in the market for a new home in the Lehigh Valley, was in a unique position to witness PPL's marketing prowess.
The previous summer, the former Navy man who went to college on the G.I. Bill, worked as an intern for an electric utility in Delaware. There, he learned about various business divisions, one of which was supposed to sell electric heating to home builders.
"They said they couldn't give that stuff away," he recalled.
Gober chatted with a salesman at the Delaware utility during a coffee break. Nobody wanted it, he was told.
Even today, the federal government discourages heat pumps, one of the most common electric heating devices, in the North. They "operate very inefficiently at sub-freezing temperatures," a U.S. Department of Energy Web site warns.
Gober then moved to the Lehigh Valley for a manufacturing job. At first, he looked at apartments.
"I was amazed," he said. "I couldn't believe the amount of [electric] baseboard heat in this area."