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Broker To Pay $25,000 Under Settlement Approved by PUC Relating To Alleged Operation Without License, Receives License

November 10, 2016

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

The Pennsylvania Public Utility Commission (PUC) approved a settlement between its Bureau of Investigation and Enforcement (I&E) and Fair View Energy, Inc. which resolves allegations that the company acted as a broker or marketer of electricity without being properly licensed by the PUC, and under which Fair View Energy will pay a total civil penalty of $25,000

According to the petition for settlement, "Fair View meets the definition of an EGS that acts as a broker or marketer in that from June 1, 2015 to May 26, 2016, it served as an agent or intermediary in the sale and purchase of electric energy, but did not take title to electric energy."

"During the time in question, Fair View was not licensed by the Commission as a broker or marketer of electric energy," the petition for settlement stated

"I&E's investigation found that two of the corporate officers of Fair View, Jay A. Snyder and Michael P. McCormick, were previously associated as either employees or independent contractors with other EGSs who are or were licensed by the Commission," the petition for settlement states

The petition for settlement states that Fair View stopped brokering electric generation supply in the state on the same day that an I&E formal complaint was served: May 26, 2016. However, the petition for settlement states I&E first informed Fair View in a February 25, 2016 letter that I&E was investigating the company for its alleged activity without a license. Prior to its cessation of brokering in response to the formal complaint, the petition for settlement states that I&E Staff was prepared to allege that, "Fair View continued brokering EGS service without a license after being notified by I&E of the initiation of I&E's investigation."

I&E Staff was prepared to allege that approximately 32 commercial customers were enrolled by Fair View's allegedly unlicensed brokering activities.

In the petition for settlement, Fair View said that its principals were unaware of a legal requirement in Pennsylvania for entities operating as brokers to obtain an EGS license and first became aware of the possibility of needing an EGS license to lawfully operate as a broker when I&E initiated its informal investigation. Within two weeks of the initiation of the informal investigation, Fair View began the EGS application licensing process by obtaining a bond in the amount of $10,000, Fair View said in the petition for settlement

The PUC adopted the settlement which provides that Fair View will pay a total amount of $25,000 to resolve the allegations of unlicensed EGS brokering in order to fully and finally settle all possible liability and claims of alleged violations of the Code and/or Commission regulations arising from, or related to, the unlicensed EGS brokering operation complained of herein. Under the settlement, $15,000 of the total civil penalty settlement amount shall be paid within 60 days of the date the Commission's Order approving the settlement becomes final, and $10,000 of the total civil penalty settlement amount shall be paid within 120 days of the date the Commission's Order approving the settlement becomes final.

Under the settlement, Fair View shall also pay $350, related to the annual fee for serving as an EGS broker during the 2015 calendar year.

The PUC also granted Fair View Energy, Inc. an electric broker license to serve all customer classes in all service areas

Jay Snyder and Michael McCormick, Partners at Fair View Energy, Inc., provided the following statement to EnergyChoiceMatters.com:

"We are pleased to have this matter resolved and appreciate the Commission’s approval of this settlement, as well as our application to begin lawfully operating as a broker in Pennsylvania. It was never our intention to violate Pennsylvania law and we are committed to following all of the Commission’s regulations in serving our customers as licensed brokers. We measure our success on results and satisfaction for our customers. It's important to note that none of our customers were negatively affected or complained to the PUC about this matter."

In adopting the settlement, the PUC declined to adopt a term of the settlement which had provided that an ex parte email communication received in the proceeding shall be stricken, removed from the formal record in the proceeding, and unpublished from the Commission's website. The ex parte communication was from John Holmes, CEO of Frontline Power Solution, which made various allegations against Fair View. While the ex parte communication was not evidence (and Frontline did not litigate a protest originally filed in Fair View's licensing docket), Commissioner David Sweet said that removal of a record document is not appropriate absent a compelling reason, which was not justified by settling parties, and the sought treatment departs from how stricken testimony is typically handled (which is preserved with a notation it has been stricken).

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