RESA Files Protest Against Pennsylvania Broker Application Of FirstEnergy Advisors

August 5, 2020

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

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The Retail Energy Supply Association filed a protest nunc pro tunc at the Pennsylvania PUC opposing the application of Suvon, LLC d/b/a FirstEnergy Advisors for an electric broker/marketer license, as RESA alleged, "FirstEnergy Advisors lacks the technical fitness to maintain the Pennsylvania Public Utility Commission’s ('Commission') consumer protection and competitive market safeguards and lacks the financial fitness to function without unjust subsidization from its EDC parent FirstEnergy Corporation ('FirstEnergy Corp.') as proposed in the application which should be denied."

RESA's protest was filed nunc pro tunc because the 15-day protest period had ended

RESA said that it, "became aware of FirstEnergy Advisor’s Application on or about July 30, 2020[.]"

Readers of EnergyChoiceMatters.com were the first to learn of FirstEnergy Advisors' broker application on June 16 in our exclusive story on the application (see story here)

In the protest, RESA alleged, "FirstEnergy Advisors lacks technical fitness because its Application lacks the requisite details on how it intends to ensure compliance with the Commissions regulations. In particular, given the relationship, closeness, shared facilities, and shared workers that FirstEnergy Advisors and FirstEnergy Corporation ('FirstEnergy Corp.') have, the Commission’s regulations at 52 Pa. Code § 54.121 – 54.122 raise a heightened concern for the instant application. As discussed below, the Application is unclear that FirstEnergy Advisors and FirstEnergy Corp. will operate in an independent capacity so as to ensure the Commission’s consumer protections and competitive market safeguards are upheld during its operations."

"The Application makes no indication how FirstEnergy Corp. and FirstEnergy Advisors intend to comply with § 54.122(1) regarding preference or advantage that an electric distribution company (FirstEnergy Corp.) may not give to an electric generation supplier (FirstEnergy Advisors) over any other electric supplier in processing a request by a distribution company customer for retail generation supply service. Indeed, as expressed below ... all of FirstEnergy Advisors’ management, directors, and employees as indicated are either currently or 'formerly' employees of FirstEnergy Corp., providing a basis for concern of both bias and preference in the relationship FirstEnergy Corp has with competitive EGSs," RESA alleged

"The Application makes no indication how FirstEnergy Corp. and FirstEnergy Advisors intend to comply with § 54.122(10) regarding how either entity shall not state or imply that FirstEnergy Advisors services are inherently superior based on its affiliation with FirstEnergy Corp. The Application is wholly deficient on the Commissions requirement that a disclaimer be made in every format in which FirstEnergy Advisors communicates with customers. Indeed, the Application makes no reference as to how FirstEnergy Advisors intends to market its services to ensure that customers do not feel that they are required to buy electricity from FirstEnergy Advisors which shares its name with FirstEnergy Corp. over the services of other electric generation suppliers in the market," RESA alleged

"[T]he Application makes no indication on how FirstEnergy Advisors intends to alleviate customer confusion regarding the quality of service as it markets using a name shared with the electric distribution company, FirstEnergy Corp. Indeed, it appears that FirstEnergy Advisors intends to take complete advantage of its namesake for marketing and customer capture. As seen in Attachment A to this Protest, FirstEnergy Advisors has marketed via their website to customers in Ohio under the same layout and design of FirstEnergy Corp., seemingly indicating to potential customers a superior quality of service over other EGSs," RESA alleged

RESA alleged, "Upon information and belief, RESA understands that FirstEnergy Advisors and FirstEnergy Corp share a common office. The Application does not indicate how FirstEnergy Advisors and FirstEnergy Corp. intend to ensure independent EDC and EGS operations in compliance with the Commission’s regulations while operating at the same address."

RESA alleged, "Third, every single person identified in FirstEnergy Advisors application is either a current or 'former' employee of FirstEnergy Corp as indicated by their email address contacts or by their resumes where attached to the application."

RESA further alleged that, "FirstEnergy Advisors does not possess the necessary financial fitness to warrant approval as it has not identified in the Application at Section 7 how its operations can function financially separate and without unjust subsidization from its parent EDC FirstEnergy Corp. This raises grave concerns that Commission Regulated EDC service and its ratepayers may be subsidizing an unregulated affiliate EGS operation which could harm both the competitive market and FirstEnergy Corp.’s ratepayers."

RESA alleged that since, "FirstEnergy Advisors potentially shares offices, employees, and administrative resources with FirstEnergy Corp.," such, "presents an issue of unjust subsidization which could harm the competitive market and ratepayers."

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