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State Senator

Bob Duff

Majority Leader

Representing Norwalk & Darien

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Contact: Adam Joseph
860-240-8641

April 29, 2014

Connecticut Senate Votes to Increase Protections for Electric Consumers

Reforms will empower customers to make informed choices with re-designed bills and more information when shopping

On Tuesday members of the Connecticut State Senate cast a unanimous, bipartisan vote in favor of greatly strengthened consumer protection measures for residential electric customers.

Passage of the legislation was led by Senate President Pro Tempore Donald E. Williams, Jr. (D-Brooklyn) and State Senator Bob Duff (D-Norwalk), Senate Chairman of the Energy & Technology Committee.

“Too many electric customers have signed up for electric service on the promise of low rates, only to be shocked after opening their bills. Fine print and deceptive marketing practices allowed unscrupulous salespersons to pull the wool over consumers’ eyes,” said Senator Williams. “This legislation will inform, empower and protect customers and provide them with all of the information they need. They will receive redesigned bills and timely reminders to stay on top of their accounts and continue making informed choices.”

“When customers shop for electric service, they should know exactly what is being offered, and what their current rate and terms are. This bill will make that information available on customer’s monthly bills, in periodic reminders, online and in advertising materials,” said Senator Duff. “By increasing transparency in electric billing and requiring full disclosure of contract terms, we are empowering consumers to find the best deal that meets their needs, with no nasty surprises.”

“We have seen some electric price shocks in recent months due to extremely cold winter weather. We can best help consumers to keep their costs down in such scenarios by making the terms of their service as transparent as possible. This legislation pulls the most important consumer information out of the fine print and puts it right up front in plain view,” said Senate Majority Leader Martin M. Looney (D-New Haven).

Residential electric customers in Connecticut may choose to receive generation service from a variety of private electric suppliers offering various rates, rate structures and contract terms. Alternatively, customers may elect to receive default “standard offer” generation service from their utility company, Connecticut Light & Power (CL&P) or United Illuminating (UI).

In recent years and months there have been a growing number of consumer complaints about private electric suppliers, including 1,300 formal complaints filed with the Public Utilities Regulatory Authority (PURA). Customers have cited issues including price spikes, deceptive telemarketing and direct sales practices, and a lack of transparency regarding rate plans and contract terms.

The provisions of Senate Bill 2, An Act Concerning Electric Customer Consumer Protection, will empower customers to make informed choices by requiring more transparent billing and marketing, and prohibiting coercive or deceptive sales practices.

More transparent billing
The bill charges PURA with redesigning the standard billing format for residential electric customers by July 2015, as well as the account summary page for online billing. The new bills must display additional account information as applicable, beyond what is required under current law.

These new items include, as applicable: the private supplier rate, the standard service rate (for comparison by all customers), any change in the customer’s rate effective for the next billing cycle, the term and expiration date of current rates, the dollar amount that would have been billed under standard service (for supplier customers), applicable cancellation fees, a reminder if the customer’s rate is variable, the web address of the online supplier rate board, and the toll-free number to obtain standard service.

Until bills are redesigned in July 2015, customers will receive a quarterly bill insert containing this information. The billing format will then be revised every five years.

An improved shopping experience
The bill directs PURA to redesign the online rate board at www.energizect.com, which allows customers to comparison shop for private supplier offers. Every two years PURA must review the site and make improvements for clarity and ease of use. The legislation also requires suppliers to disclose timely and accurate rate information for the site, including the highest and lowest variable rates they have charged over the last 12 months.

New marketing standards
Under the bill, PURA is directed to study and adopt new marketing standards for private suppliers and their sales agents. Any suggestion that a supplier’s agent represents UI or CL&P is specifically banned, along with any statement that customers must choose a private supplier. Additional requirements provide for greater disclosure of rate and contract terms in suppliers’ advertising materials.

PURA must also develop a summary of contract terms to be presented to customers by private supplier sales representatives, including any rate the customer agrees to, variability of such rate, term of the rate, contract renewal information, the customer’s cancellation rights and other information.

Further provisions of the bill will:

  • Help customers to change suppliers quickly. Requires the utilities to transfer customers to standard offer service within 72 hours of their request. Directs PURA to study expediting switching of customers to and among the various private suppliers.
  • Reduce early termination fees. Allow customers greater freedom of choice by reducing the maximum cancellation fee from $100 to $50.
  • Require notice of new contract terms. Customers whose contracts provide for an auto renewal or transition to variable rates must receive notice 45 days in advance, including a plain-English description of the new terms and recent history of rates.
  • Help customers who move. Allows customers who move to keep their electric supplier, and prevents their being charged a cancellation fee.
  • Stabilize teaser rates. If a supplier markets a variable rate plan with an introductory “teaser” rate, that rate may not increase for at least three months.

The legislation now proceeds to the floor of the House of Representatives. The 2014 legislative session ends May 7th.

 

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Adam Joseph
860-240-8641

Mailing Address

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Room 3300
Hartford, CT 06106-1591

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E-mail

Bob.Duff@cga.ct.gov

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