|
|
|
|
|
Brokers Seek Clarification From PUC On Need To Disclose Broker Fees, Seek Requirement For Disclosure Of Fees From Non-Broker Channels (Independent Sales Reps, Gov't Aggregation)
The Energy Professionals of Ohio (EPO) hereby petitioned the Public Utilities Commission of Ohio to clarify a 2014 finding on rehearing that requires the, "disclosure of all fees including those by brokers, governmental aggregators, etc."
As reported by EnergyChoiceMatters.com, the February 2014 rehearing order addressed new rules that adopted a requirement that, "[a]n itemized list and explanation of all prices and all fees associated with the service," shall be provided to customers.
On rehearing, PUCO clarified that, "[this] change to Ohio Adm. Code 4901:1-21-12(B)(7) was made to require disclosure of all fees including those by brokers, governmental aggregators, etc., and does not require disclosure of cost components such as postage."
EPO said that the fees and costs that are to be disclosed has come under question in the years since the Commission’s order. "Market participants have questioned if the fee amounts should be disclosed on a contract or just the existence of a fee," EPO said
"Further, market participants have questioned if the 'etc.' in the Commissions order means that the fees charged by exclusive independent agents of suppliers should be disclosed as well since they are third-party entities like aggregators and brokers who help in the transaction of energy contracts," EPO said
"Additionally, there is a discussion as to whether the order applies to all contracts and not just residential and small commercial contracts," EPO said
EPO asked that PUCO make the following clarifications:
1. That fee disclosure is required for residential and small commercial contracts only, since O.A.C. 4901:1-21-12(B) states, "All CRES provider contracts with residential and small commercial customers shall include, but not be limited to, the following information (to be stated in clear and understandable language)"
2. That fee disclosure is required for ALL third party entities that serve to connect retail customers with CRES suppliers. This includes brokers, governmental aggregators, and exclusive independent agents of CRES suppliers.
"Energy contracts are sold via three 'channels': direct from a CRES supplier via internal sales, via a broker or governmental aggregator with a pre-existing relationship with the customer, or exclusive agents who are independent contractors hired by CRES suppliers to sell its products. Requiring fee disclosure on ONLY brokers and aggregators distorts the market by creating a competitive disadvantage for those providing transparency of multiple supplier offers in the customer shopping process. It artificially, and incorrectly, makes their services look more expensive to customers. This is because the contract with a broker or governmental aggregator has an extra line item on it -- its fee that is already built into the per kWh price. The independent agent who is hired by the CRES supplier has no such disclosure requirement, although it is paid a fee as well. If transparency is the goal, then fees charged by ALL third parties should be required to be disclosed," EPO said
3. That fee disclosure on residential and small commercial contracts be understood to mean the existence of a fee and not the fee amount.
"Disclosing the fee amounts is redundant and makes public fee arrangements that are competitively sensitive in the marketplace. Brokers and aggregators must work with customers to obtain an agreement to work on their behalf before they can solicit the necessary information to procure and consult on potential energy contracts. As such, the customer is aware the broker/aggregator is charging a fee for service. Further, many suppliers rely exclusively or extensively on brokers as a 'channel' partner to connect them with customers. These brokers and suppliers each have their own agreements regarding fees that may differ among the parties. Requiring these fees to be made public, which, again, are already know to the customer in broker/aggregator transactions, may jeopardize these careful agreements that have been painstakingly put in place," EPO said
4. In the alternative to Suggestion #3, EPO said the Commission should clarify that all fee amounts charged by third parties who are paid to consult on or sell CRES supplier contracts, including brokers, governmental aggregators, and independent agents of CRES suppliers, shall be disclosed. This can be done simply by requiring disclosure of the per kWh fee built into the final price or the flat amount paid for each successful contract sold by a third party on behalf of a CRES Supplier, EPO said
"Requiring disclosure of all third party fees ensures that no one 'channel' is made to look more expensive than another," EPO said
ADVERTISEMENT Copyright 2010-16 Energy Choice Matters. If you wish to share this story, please
email or post the website link; unauthorized copying, retransmission, or republication
prohibited.
April 6, 2016
Email This Story
Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Karen Abbott • kabbott@energychoicematters.com
NEW Jobs on RetailEnergyJobs.com:
• NEW! -- VP, Business Development -- Retail Supplier
• NEW! -- Channel Sales Manager -- Retail Provider
• NEW! -- Retail Energy Pricing Analyst -- Retail Provider -- Houston
• NEW! -- Renewable Energy Compliance Analyst
• NEW! -- Sales Support Specialist -- Retail Supplier
• NEW! -- Director of Channel Sales, Mass Markets -- Retail Provider
• NEW! -- Supply Analyst -- Retail Provider
• NEW! -- Account Executive -- Retail Provider -- New York
• NEW! -- Customer Service Manager/Director -- Retail Provider -- Houston
• NEW! -- Director, Solutions Delivery
• NEW! -- Energy Market Business Intelligence Analyst -- DFW
• NEW! -- Senior Energy Market Operator -- DFW
• NEW! -- Energy Market Management Technician -- DFW
• NEW! -- Sales Operations Director -- Retail Provider
|
|
|
|