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Retail Supplier Agrees to Cease Marketing to Low-Volume Residential Customers, Pay $20,000 Under Settlement With Regulator

December 1, 2014

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

Sunwave Gas & Power Inc. has committed to refrain from marketing to new low-volume residential consumers in Ontario for the remainder of its license terms, and pay a $20,000 (Canadian $) penalty under an Assurance of Voluntary Compliance accepted by the Ontario Energy Board.

As of September 2014 Sunwave ceased offering, and entering into, any new contracts, or renewals of existing contracts, with low-volume residential consumers in Ontario. Under the Assurance of Voluntary Compliance, Sunwave will refrain from entering into any new contracts, or renewals of existing contracts, with low-volume residential consumers in Ontario.

Sunwave will continue to service its existing low-volume customers through to the expiry of their contracts.

According to the Assurance of Voluntary Compliance, Board staff performed transaction testing of verification calls for 50 randomly selected contracts (25 for gas and 25 for electricity). Board staff reviewed the corresponding contracts, together with their related disclosure statements and price comparisons. The Assurance of Voluntary Compliance states that in ten instances, Sunwave did not provide to the consumer a correct version of the price comparison applicable to the period when the contract was entered into.

Additionally, on November 24, 2013 Sunwave self-reported that it failed to record verification calls for 21 of its contracts. Fourteen of these contracts were enrolled over the internet and therefore did not require verifications calls. However, for the seven other contracts enrolled in person, Sunwave failed to record verification calls as required by law, the Assurance of Voluntary Compliance states

Board staff also reviewed the verification calls for 50 randomly selected contracts, "and found that Sunwave's sales representatives deviated from the Board-approved verification scripts in 22 of the calls."

According to the Assurance of Voluntary Compliance, "In twelve of the calls, the deviations were technical in nature: namely, they did not verify the correct spelling of the consumer's name or address, failed to provide the OEB's website address and did not ask consumers if they would like a copy of the verification call. However, in 10 of the calls, the deviations were of a materially substantive nature such that they likely would have impacted the consumer's decision to proceed in verifying the contract: namely, by not clearly stating the purpose of the call, by failing to disclose that the consumer is under no obligation to verify the contract, and by failing to elicit a clear 'yes' or 'no' answer to the question on whether or not the consumer agrees to verify the contract."

Board staff also reviewed the verification recordings for 50 randomly selected contracts. "In four of those recordings, the price verified during the recording and then entered into Sunwave's consumer billing system differed from the price stated in the consumers' contracts."

Sunwave further self-reported that it had identified 207 total consumers who had collectively been overbilled in the amount of $1,221.13 (99 gas contracts totaling $501 and 108 electricity contracts totaling $720.13) due to unintentional reaffirmation and process errors resulting from a system calculation error. Sunwave confirmed to Board staff that in June 2014, Sunwave sent notification letters to all affected consumers and that electricity customers would receive a credit on their July bills, and gas customers would be issued checks.

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