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Final Decision Drops Proposal for Additional $100 Compensation to Slammed Customers

February 11, 2015

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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The Connecticut PURA issued a final decision adopting new standards for electric suppliers and a new disclosure statement required for advertisements.

The standards apply to all customers under 100 kW, which the disclosure statement will apply to residential customers only.

The final decision departs from a draft order and drops an earlier proposal which would have required suppliers to pay slammed customers $100 in addition to refunds and any applicable statutory penalties

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Furthermore, PURA's final decision clarifies several provisions related to the transfer of a customer's contract between suppliers, affirming that, although customer consent is required, such consent may be provided at the time of the original enrollment (though the consent must be specific to the assignment clause).

PURA said that:

"One Licensed Electric Supplier cannot be substituted for another without the customer's consent. Therefore, a customer's contract or agreement cannot be assigned to another Licensed Electric Supplier without the customer's consent. A customer may give consent by checking a box giving consent and providing his or her signature or initials next to a paragraph or clause in the contract that, in plain language: (1) states that the customer agrees and gives consent to the contract being assigned or transferred to another supplier; (2) describes the process, time and notice the customer will be provided prior to the assignment; and (3) describes what will happen if the customer chooses not to give consent (e.g., customer will be switched to Standard Service when other contracts are assigned). As appeared in the contract, such assignment paragraph or clause must be in bolded text, in a font size that is equal to or larger than the font size of the other clauses in the contract but in no event less than 10-point font, and be clearly identified with a heading 'Assignment or Transfer of Contract.'"

The final decision provides that, prior to assigning any customers to another supplier, a supplier must file a Notice of Assignment with the Authority no later than 60 days before the expected effective date of the assignment.

Among other things, the final decision still requires that the Notice of Assignment list, "all the rate(s) that the customers will be charged by the new supplier after the assignment and the effective dates of such rate(s)."

A supplier may not assign any contracts that expire prior to the date of the intended assignment, PURA said. Although PURA did not expand on this issue in its final order, PURA has previously interpreted fixed contracts which have rolled over to a monthly variable rate to have "expired" for purposes of contract assignment.

The standards also provide that all advertisements must clearly display the name of the supplier making said offers and all advertisements offering service must have an expiration date of the offer and/or terms, if applicable.

"All guarantees must include a clear and conspicuous disclosure of how the savings will be calculated and what the supplier will do if the savings are not realized, together with any time or other limitations that the supplier may impose. For example: 'Guaranteed to be lower than Standard Service' must be accompanied by a disclosure that explains how the savings were calculated," PURA said.

"Those engaging in door-to-door sales must use, but not be limited to, a written script. A copy of the written script is to be provided to the customer. It shall include a section the customer shall sign, which attests that the script was followed by those engaging in door-to-door sales. If the person at the door is an individual other than a direct employee of the Licensed Electric Supplier the script shall include the name of the Licensed Electric Supplier being marketed, the broker/agent's name/company name and contact info. The script also shall state that those engaging in door-to-door sales did not represent themselves as an employee or member of the customer's electric distribution company," the final order provides

"All suppliers conducting telemarketing must clearly identify their company name or trade name abbreviation in the Caller ID information area. They must also identify within that Caller ID a telephone number that a customer can use to contact the supplier making the call. Suppliers are prohibited from displaying on its Caller ID any false or misleading phrases such as 'Customer Service' or 'Electric Choice,'" PURA said.

"Each telemarketing call must begin with the person conducting the call stating his/her name, their company name/broker name and the Licensed Electric Supplier for whom they are soliciting. The caller must declare that they are not associated with and do not represent the customer's electric distribution company," PURA said.

"If at any time during a third party verification the customer cannot answer a question, the verification process must end and the call must be returned to the original caller. At any time a customer does not understand a question, the verification process must end and the call must be returned to the original caller," PURA said.

Regarding sales agents, PURA said that, "The representative should be deemed appropriate for the type of contact they will be having with the public, which should include the use of background checks for those engaging in door-to-door sales."

"A Licensed Electric Supplier shall provide the Authority with the names of those conducting telemarketing on their behalf," PURA said, later specifying that, "upon request from the Authority, a Licensed Electric Supplier must provide the names of all callers conducting telemarketing on behalf of the Licensed Electric Supplier."

The new disclosure statement for ads provides that suppliers must list the following:

"Licensed Electric Suppliers are required to post the highest and lowest generation service charge rate that was billed to their customers under a variable rate offer in each of the preceding 12 months. You can find this information on [ABC Electric's] website at www.abcelectric.com/past_variable_rates or on the supplier Rate Board that is maintained by the Public Utilities Regulatory Authority at www.energizect.com/compare-energy-suppliers."

This disclosure statement shall appear on all promotional materials and all communications between the supplier and the customer, including but not limited to:

• The supplier's website

• All renewal notices or correspondence relating to a customer's service

• Direct mail

• Newspaper ads

• Magazine ads

• Email ads and information

• Any material used in door-to-door solicitation

Docket 14-07-20

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