HARRISBURG -- Gov. Ed Rendell says that one of James Cawley's big jobs as the new Public Utility Commission chairman will be to cushion residential and business electricity users from the upcoming "sticker shock" of higher electric costs.

Rate caps that were placed on Pennsylvania electric companies in the late 1990s will come off in January 2010 and January 2011 (depending on which utility a person has). Unless steps are taken by the Legislature and the PUC to soften the blow, officials said, customers' electric rates could jump 30 percent or more.

"The sticker shock could be even worse than what we've seen with rising gasoline prices," Mr. Rendell said.

Most of the affected electric companies are in Central and Eastern Pennsylvania, but Allegheny Energy in Western Pennsylvania will have its rate caps eliminated in January 2011, along with customers of Met Ed, Penelec and PECO. Caps have already come off Duquesne Light rates. PP&L Electric rates will rise in January 2010.

Mr. Cawley, whose appointment requires no other approvals, said he wants to work with the Legislature to cushion the rate shocks, adding, "We would like some legislative guidelines on mitigation steps."

One idea is to "phase in" the electric rate hikes over three to five years instead of all at once. Another idea is to permit customers to pay higher amounts in advance on their 2008 and 2009 electric bills, with the additional money earning interest until it's needed to cover the higher rates in 2010 or 2011.

Mr. Rendell said he also wants Mr. Cawley to make Pennsylvania a national leader in energy conservation by residential and business customers and a leader on "clean energy," which would reduce the amount of carbon released into the air.

"We have to find ways to reduce our energy usage,'' said Mr. Rendell, who also wants the PUC to expand programs to help lower-income homeowners afford electricity.

Mr. Cawley, 62, who is from McKean County but has worked in Harrisburg since 1970, has served two stints on the utility regulating agency -- from 1979 to 1985 under Republican Gov. Dick Thornburgh and since 2005 under Democrat Rendell.

"I am confident he can meet these upcoming challenges,'' said Mr. Rendell.

Mr. Cawley replaces Wendell Holland. He will be paid $131,813 a year.