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PSC Orders Retail Supplier Not To Solicit Any Additional Customers Until Complaint Proceeding Resolved

PSC Chair: Supplier's Action Has Likely "Set Back Progress" Of Retail Competition

Commissioner: "Sad Day" For Retail Choice, Companies Engaged In Such Behavior "Should Not Be Doing Business"

July 17, 2019

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Copyright 2010-19
Reporting by Paul Ring •

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In addressing a complaint filed by Maryland PSC Staff against Smart One Energy, LLC ("Smart One" or "SOE") for, among other things, allegedly not obtaining 'wet signatures' for telephonic enrollments, Maryland PSC Chair Jason M. Stanek said that the supplier's actions have likely "set back" the progress of retail competition in the state

As previously reported by, Smart One Energy, LLC has conceded that it did not obtain 'wet signatures' for telephonic enrollments in Maryland, which is required outside of limited exceptions, with such exceptions generally not applicable to cold calling

During the PSC's meeting today, counsel for Smart One Energy said that counsel does not believe that the company has "executed contracts" for its 10,000 customers in the state

The Maryland Office of People's Counsel has also alleged that SOE's telephone sales script stated that the customer was, "qualified to get up to 10% discount for 2 months on your gas supply charges FROM SMART ONE ENERGY. AND MOVING forward you will be on a variable plan from the next meter reading date." [sic] (see further details on OPC's allegations here)

OPC has alleged, "The Company did not provide this discount to customers ... the Company charged rates higher than the utility rates from the first month."

The Commission took Staff's complaint, which was limited to issues arising from three discrete customer complaints, under advisement, and did not render a decision at its meeting today concerning the amount of any penalty, remedial action, and any license suspension or revocation.

Stanek, however, said that he believes any penalty needs to be "substantial".

Stanek called the actions of Smart One the, "most egregious and disturbing" that he has witnessed

Stanek noted that the actions of "bad actors" impact all retail suppliers

Commissioner Michael T. Richard similarly said that SOE's actions "imperil" energy choice, calling it a, "sad day for retail choice."

Richard said that such actions "cannot stand" and said that companies engaged in such behavior, "should not be doing business," in Maryland

Richard called the actions the, "worst kinds of violations", that can take place, and said that any penalty must be set to serve as an adequate deterrent

Commissioner Mindy L. Herman called the company's behavior the "gravest" example of non-compliance in her time on the Commission

The PSC did grant injunctive relief while it further considers the matter, and ordered that Smart One not solicit any additional customers in Maryland until the matter is resolved

The PSC also directed the company, PSC Staff, and OPC to develop a letter to be sent to SOE customers regarding refunds, for the difference between the SOE rate and SOS rate. The PSC did not direct to what universe of customers the refunds shall apply (e.g. all customers or only a subset), which shall be addressed by the parties. Parties shall jointly develop the letter and file it with the PSC

During the meeting, Herman pressed on relief sought by OPC concerning SOE's broader operations. As previously reported, OPC sought that SOE be limited to charging no more than the default service rate for those customers with which it does not have a valid enrollment.

Herman asked how such a directive would not amount to regulation of a retail supplier's rates, which is outside the PSC's authority.

OPC said that such a rate cap is a permissible 'other remedy' and 'refund or credit' which the PSC may require under Section 7- 507(k)(1) of the code

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