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Proposed Order Would Eschew Regulatory Staff's Sought Fine Against Retail Supplier Of Up To $1 Million; Would Order Refunds And License Cancellation That Were Previously Agreed To By Supplier

February 4, 2020

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Copyright 2010-20 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The following story is brought free of charge to readers by EC Infosystems, the exclusive EDI provider of EnergyChoiceMatters.com

A proposed order from an Illinois ALJ would not impose an additional monetary penalty on LifeEnergy, LLC for alleged violations of certain enrollment and compliance rules, and instead recommends that LifeEnergy pay $34,000 in customer refunds to which the company has already agreed, and that the Commission accept LifeEnergy's prior agreement to cancel its retail electric supplier license

As previously reported by EnergyChoiceMatters.com, the proceeding concerns an investigation by the ICC of LifeEnergy's alleged failure to comply with Part 412 of the Commission's rules, as Staff alleged that LifeEnergy violated Section 412.120(g) because certain enrollments were not appropriately verified as required by the rule. Staff alleged that it had identified multiple instances of the company’s sales agents approaching customers and attempting a second TPV during the 24-hour waiting period prescribed by Section 412.120(g) which prohibits such contact. Staff also alleged that the company did not properly train its agents. See our prior story for a full discussion of the allegations

As previously reported, Staff recommended the Commission impose a "financial penalty" ranging from $350,000 to $1,000,000. The Citizens Utility Board had sought a penalty of $2.13 million.

LifeEnergy, which as exclusively first reported by EnergyChoiceMatters.com last year sold most of its book to NRG Energy, has filed to surrender its Illinois retail electric supplier license, and has agreed to customer refunds. LifeEnergy argued that the ICC lacks authority to issue fines for purely punitive purposes, which the company says would be the case here, given the other corrective actions that have been undertaken.

The proposed order would agree that LifeEnergy violated Sections 412.170(e), 412.210(b), and 412.120(g) of the Commission’s Rules.

However, in the proposed order, the ALJ would find that a penalty of $2.13 million is "unreasonably high," while Staff’s range of penalties is "arbitrary."

"The Commission notes that the entity charged in this docket is not a large utility, but a smaller RES. LifeEnergy is one player in a large retail marketplace in this State. Further, LifeEnergy has sold its book of business to NRG. When considering a monetary penalty, the Commission must consider assessing a penalty that the Company can actually pay. There is nothing in the record which indicates the amount LifeEnergy received from its sale to NRG," the ALJ said in the proposed order

"The Commission agrees with Staff and CUB that the Company’s lack of adherence to the Commission’s Rules not only affect its own customers but the entire electric supplier marketplace. The Commission agrees that ensuring RES agents are trained on the Commission’s Rules and properly inform customers about contract terms is paramount. Moreover, properly trained agents ensure customers understand the terms of the sales contract as described by the sales agent," the ALJ said in the proposed order

"The Commission finds that the most important factors in this case are that the Company has admitted wrongdoing, voluntarily agreed to refund customers, and relinquished its certificate. The Company will refund its customers $34,000. As to the Company’s withdrawal of its certificate, Staff argues this is a business decision versus an acceptance of wrongdoing; however, the Commission notes that the Company no longer operates in the State, and the reasons why are irrelevant. As noted above, the Commission has the authority to revoke LifeEnergy’s certificate of service authority, which is the harshest penalty outlined in Section 16-115B(b)," the ALJ said in the proposed order

"Finally, the Commission points out that the Company did attempt to train RES agents commencing within six (6) days of receiving the NOAV, which the Commission considers to be reasonable. Therefore, the Commission declines to assess any additional monetary penalties as outlined in Section 16-115(b)(2)," the ALJ said in the proposed order

The proposed order would require LifeEnergy to refund the affected customers in the amount of approximately $34,000 and would cancel LifeEnergy's electric supplier certificate

Docket 18-1540

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