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Retail Supplier To Pay $675,000, Exit From Non-shopping Customer Assignment Program Under Settlement

Supplier Continues Voluntary Marketing Suspension, Will Issue $1 Million In Refunds

September 6, 2019

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Copyright 2010-19
Reporting by Paul Ring •

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Verde Energy USA Ohio, LLC d/b/a Verde Energy would pay a forfeiture of $675,000, and withdraw from Dominion East Ohio’s Monthly Variable Rate (MVR) program (see explanation at bottom of story) for a period of one year, under a settlement with Staff of the Public Utilities Commission of Ohio

The settlement would resolve an investigation into various alleged sales and marketing behavior of Verde. The investigation had been exclusively first reported by (see full story here)

Among other things, PUCO Staff had alleged that, "Verde used inaccurate caller identification information indicating to customers that Verde's outgoing calls are instead originating from Duke Energy Ohio, AEP Ohio, and/or the Internal Revenue Service, a practice also known as spoofing, in violation of Ohio Adm.Code 4901:1-21-03(A), 4901:1-21-05(C)(8)(h), 4901:1-21-05(C)(10), 4901:1-29- 03(A), 4901:1-29-05(D), and 4901:1-29-10(A)."

Staff had also alleged that, "Verde sales representatives provided misleading information during telemarketing solicitations, in violation of Ohio Adm.Code 4901:1-21-03(A), 4901:1-21-04,4901:1-21- 05(C), 4901:1-29-03(A), 4901:1-29-05(D), and 4901:1-29-10(A), and which did not follow the sales script Verde provided to Staff."

See more details on the allegations in our prior story

The settlement provides that:

• Verde Energy has voluntarily ceased all marketing and customer enrollment activities in Ohio, as represented to the Commission in the Motion filed in this matter on May 3, 2019. Staff and Verde Energy agree that this suspension by Verde Energy of all marketing activities and customer enrollment in Ohio will continue until October 30, 2020, for a total of eighteen (18) months.

• Verde Energy will withdraw from Dominion’s MVR program for a period of one year, commencing as of the date Verde Energy notified Dominion of its withdrawal from the MVR program. Verde Energy may enroll retail customers through Dominion’s MVR program at the conclusion of this one-year period.

• For all retail electric residential customers enrolled by Verde Energy in Ohio from October 1, 2018 through April 30, 2019, Verde Energy will re-rate those customers to the second lowest 12-month-fixed 100% renewable price shown on the PUCO’s historic apples-to-apples chart for the week of December 17, 2018, adjusted for any rewards provided by Verde Energy to re-rated customers as part of Verde Energy’s shopping rewards program. This will result in refunds of approximately $1,068,000.

• Verde Energy will not transfer or sell customer contracts to another entity during the stay-out period without the prior consent of PUCO Staff, except as necessary in connection with any settlement with intervenor, Interstate Gas Supply, Inc.

• Verde Energy will submit an action plan for compliance at least ninety (90) days prior to resuming marketing and customer enrollment in Ohio.

• Verde Energy will notify all customers enrolled in Ohio since June 1, 2018 that they may cancel contracts without penalty at the customer’s election. The notice shall indicate that PUCO Staff has alleged that Verde Energy may have misled customers in Ohio during marketing of its product. The notice shall be sent within 30-days of the Order approving the Stipulation.

• Verde Energy agrees to pay a forfeiture of $675,000.00

The settlement remains subject to PUCO approval

Case No. 19-958-GE-COI

DEO MVR program: While the SCO serves as the default rate for customers who have never shopped, customers whose contract with a retail supplier expires, or whose government aggregation ends, are, barring an affirmative choice (including an affirmative return to the SCO), placed on the SCO for two months. After such time, if the customer has not made an affirmative choice, the customer is assigned to a retail supplier and is charged the supplier's Monthly Variable Rate (MVR)

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