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Texas REPs Seek Declaratory Order That "CenterPoint Energy" Branding of New CenterPoint Energy Services, Inc. Shopping Portal Violates Affiliate Prohibitions
August 8, 2012
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The Texas Energy Association for Marketers, Alliance for Retail Markets, and Reliant Energy Retail Services, LLC have sought a declaratory order from the Public Utility Commission of Texas that broker CenterPoint Energy Services, Inc.'s operation of an online shopping portal makes it a competitive affiliate of electric utility CenterPoint Energy Houston Electric, and thus implicates several PURA and Substantive Rule prohibitions on affiliate conduct (Docket 40636).
As previously reported, CenterPoint Energy Services, Inc. recently launched an electric shopping comparison website, myTrueCost.com.
"By owning and operating the Retail Shopping Website, CenterPoint Energy Services is a competitive affiliate of CenterPoint Energy Houston Electric, LLC as defined by PURA § 39.157(i)(1) and P.U.C. SUBST. R. 25.272(c)(2) as it is an affiliate that provides services or sells products in a competitive energy-related market in this state," the REPs said.
PURA defines "competitive affiliate" to mean, "an affiliate of a utility that provides services or sells products in a competitive energy-related market in this state, including telecommunications services, to the extent those services are energy related."
Matters asked CenterPoint Energy Services, Inc. and CenterPoint Energy Houston Electric, LLC for comment. CenterPoint Energy, Inc. elected to respond at the corporate level and provided the following statement from CenterPoint Energy, Inc.:
The REPs specifically sought that the Commission issue a declaratory order that finds that the retail shopping website does not conform with PURA § 39.157 and P.U.C. SUBST. R. 25.272 as follows:
"1. By owning and operating the Retail Shopping Website, CenterPoint Energy Services is a competitive affiliate of CenterPoint Energy Houston Electric, LLC as defined by PURA § 39.157(i)(1) and P.U.C. SUBST. R. 25.272(c)(2) as it is an affiliate that provides services or sells products in a competitive energy-related market in this state.
"2. As a competitive affiliate of CenterPoint Energy Houston Electric, LLC, a regulated transmission and distribution utility operating in the state of Texas pursuant to the Commission's regulatory jurisdiction, CenterPoint Energy Services is prohibited from engaging in joint marketing, advertising, or promotional activities with CenterPoint Energy Houston Electric, LLC in a manner that favors the competitive affiliate pursuant to PURA § 39.157(d)(6) and P.U.C. SUBST. R. 25.272(h)(2)(A)-(B).
"3. The Retail Shopping Website prominently displays the CenterPoint Energy name and service mark contrary to PURA § 39.157(d)(6) and P.U.C. SUBST. R. 25.272(h)(2)(B)(i), which prohibit communications and contacts by a TDU with any existing or potential customers in a manner that favors the competitive affiliate where the TDU acts or appears to act on behalf of a competitive affiliate.
"4. The www.CenterPointEnergy.com website, which serves as the website for CenterPoint Energy Houston Electric, LLC, directly links to the website of the competitive affiliate CenterPoint Energy Services and to the Retail Shopping Website, which is expressly prohibited by P.U.C. SUBST. R. 25.272(h)(2)(B)(vi) where such link favors a competitive affiliate.
"5. The Retail Shopping Website is a shared resource that creates customer confusion and significant opportunities for cross-subsidization of affiliates contrary to P.U.C. SUBST. R. 25.272(d)(2) especially in light of the use of the identical 'CenterPoint Energy' name and service mark by both the regulated transmission and distribution utility and the competitive affiliate." The REPs also requested as interim relief, "an interim order from the Commission directing CenterPoint Energy to cease and desist operation of the Retail Shopping Website until a declaratory order can be issued to prevent ongoing harm to the competitive retail electricity market and customer confusion."
Citing various marketing materials, the REPs alleged that the "CenterPoint Energy" name is used interchangeably with the regulated utility and all its affiliate companies. Therefore, even though the utility's legal name may not specifically be mentioned in certain marketing materials, including a television commercial, for the affiliate's shopping website, REPs alleged that the marketing material is still improper under PURA and the Substantive Rules.
"Attachment D to this petition is a screen-shot of the CenterPoint Energy TDU link from the CenterPoint Energy website home page. This page unambiguously describes the services and functions of the CenterPoint TDU under the name and service mark 'CenterPoint Energy.' CenterPoint Energy TDU does not have a separate website. The service trucks used to maintain and repair the transmission and distribution lines owned by the CenterPoint Energy TDU along with the helmets worn by its service workers are marked with only the CenterPoint Energy name and service mark as demonstrated by the pictures attached to this petition as Attachment E," the REPs said.
"Whatever corporate organizational distinction and legal business organization constructs the CenterPoint companies use to describe and maintain the regulated TDU as a distinct legal entity from its other affiliate companies, the CenterPoint Energy TDU is presented publicly as 'CenterPoint Energy' and there is no way for the general public to meaningfully distinguish the CenterPoint TDU from any other legal entity using the CenterPoint Energy name. The [broker affiliate's] television advertisement in Attachment C uses the CenterPoint Energy name and service mark to draw customer inquiries about the Retail Shopping Website in violation of P.U.C. SUBST. R. 25.272(h)(2)(A)(i), solicits business on behalf of the service in violation of 25.272(h)(2)(A)(ii), and gives the appearance that the CenterPoint TDU is speaking on behalf of the service in violation of 25.272(h)(2)(A)(iii)," the REPs alleged.
Copyright 2010- "CenterPoint Energy does not sell electricity. The company simply seeks to make it easy for consumers to find the right plan for them through myTrueCost.com. We are disappointed that any retail electric provider would be opposed to the operation of a website that helps consumers to make informed choices when buying electricity. At the same time, we appreciate the support of any and all retail providers who wish to participate in promoting informed consumer shopping."
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