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ESCO Says Customers Complained About Bundled LED Lighting, Supply Program Because Utility Told Customers That ESCO Was "Overcharging" Them

October 4, 2016

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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

In its initial response to a New York PSC show cause order, ABC Energy, LLC alleged that the majority of customers who complained about a new service bundling LED lighting with energy supply, "understood what was going on but complained anyway because the utiility [sic] told them ABC Energy was overcharging them."

Prompting the show cause order, New York PSC Staff had alleged that ABC Energy, LLC, through use of a program offered by marketer Atlantis Business Consulting, LLC [which is owned by the principals of ABC Energy], was enrolling customers who had been contacted by Atlantis Business Consulting about free LED lighting. Atlantis Business Consulting, PSC Staff alleged, used an in-person meeting regarding the LED lighting to sell energy supply, and circumvent otherwise required customer protections for door-to-door sales due to the use of a pre-scheduled appointment (which Staff alleged had been represented as for the purpose of discussing only LED lighting not ESCO service) for which such consumer protections do not apply. Atlantis Business Consulting, PSC Staff alleged, would then enroll such customers with Marathon Energy or another ESCO (see prior story for more details)

Since the issuance of the show cause order, ABC Energy said that it has voluntarily suspended the LED lighting campaign, which it said is the only campaign which has generated the complaints at issue, in order to properly address the concerns of the Public Service Commission.

ABC Energy said that since it has suspended the marketing which had given rise to the show cause order, and because it had received only one complaint for the approximately three years before starting the LED campaign, ABC Energy's eligibility to enroll other customers should not be suspended.

ABC Energy vigorously disputes that its LED lighting campaign constituted door-to-door marketing within the meaning of the Uniform Business Practices. "While the show cause order alleges one instance where the concept of switching energy suppliers may not have been mentioned, that does not immediately transform all appointments into door-to-door marketing requiring a third party verification. The plain fact of the matter is that appointments were scheduled. ABC Energy will address this issue in its second filing," in response to the show cause order, ABC said

Regarding the complaints generated by the LED program, ABC Energy said, "ABC Energy has spoken to the customers who complained. The majority of the customers claim to have understood what was going on but complained anyway because the utiility [sic] told them ABC Energy was overcharging them. It was difficult for the customers to understand the increased rate (to pay for the LED bulbs) versus the overall savings due to the reduction in consumption. ABC Energy has spoken to the utility; Atlantis has retrained the sales staff; ABC Energy has retrained the support staff to field these concerns and break it down to an elementary level. Just because the rate is higher it does not mean that customers are being over charged. ABC Energy has encouraged the customers to send the bills in for review and has provided free audits to explain consumption reduction. In some cases ABC Energy has offered rate reductions as a courtesy just to keep a customer happy."

ABC Energy's response to a show cause order also details numerous actions it took in designing the LED lighting program it said were intended to ensure quality sales, and further actions taken after initial complaints were received

Most notably, ABC Energy, from the start, insisted that all Atlantis sales agents representing its products be paid a base salary to reduce temptations of fraud.

ABC Energy also said that after certain initial complaints, it revised the process so that, when making an appointment, instead of just mentioning fixing the rate the person scheduling the appointment needed to clearly state that Atlantis would be "fixing the energy supply rate with one of our ESCOs".

"Atlantis determined along with other factors after talking to the customers who complained that some identified the process of choosing a supplier by mentioning the rate, others by mentioning ESCOs and others by mentioning energy supply. By including all three in the script Atlantis felt most confident that it would reach a general understanding to everyone," ABC Energy said

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