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Under Draft, State Would Initiate Investigation Into Two Retail Suppliers, Whether Contracts Should Be "Voided"

October 14, 2014

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Copyright 2010-14 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The Connecticut PURA, in a draft decision, has indicated that it intends to initiate an investigation into two retail electric suppliers' compliance with the agent training requirements under statute, and whether contracts should be "voided" should PURA determine non-compliance.

In its revised draft decision in Docket 13-07-18, in discussing requirements related to third party agents, PURA noted, Conn. Gen. Stat. §16-245o provides that, "No third-party agent may sell electric generation services on behalf of an electric supplier unless (A) the third-party agent is an employee or independent contractor of such electric supplier, and (B) the third-party agent has received appropriate training directly from such electric supplier." (emphasis by PURA)

The draft decision noted that any violation of the statute shall be deemed an unfair or deceptive trade practice and that, "Any contract for electric generation services that the authority finds to be the product of unfair or deceptive marketing practices or in material violation of the provisions of this section shall be void and unenforceable."

The draft decision further notes that, in written exceptions to a prior draft, some suppliers claimed that the Authority's reporting requirements relating to third-party agents are "overbroad and burdensome" and should be eliminated.

The draft decision avers that Choice Energy LLC stated, "...for marketing agencies, it is unclear that Suppliers can compel their third party agents to supply lists of employees, or that suppliers can control the accuracy of any such lists."

The draft decision also avers that Discount Power stated, "Suppliers contract with marketing companies, who in turn have employees and contractors. The suppliers compensate the marketing companies. The marketing companies in turn compensate their employees and contractors. As such, the third-party agent is the marketer, not its individual employees."

"It is clear from Choice Energy's and Discount Power's statements that they do not know the identities of the agents who have been selling electric generation services on their behalf; and therefore, they have not provided appropriate training directly to such agents, as required by Conn. Gen. Stat. §16-245(h)(1)," the draft decision would conclude.

"Accordingly, the Authority will initiate dockets to examine Choice Energy or Discount Power's marketing practices to determine whether they have violated Conn. Gen. Stat. §16-245o(h)(1) and whether any contracts must be voided, pursuant to Conn. Gen. Stat. §16-245o(j), for being the product of such violations, if any," the draft provides

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