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Retail Supplier To Pay $150,000 Under Settlement With PUC Staff

Investigation Prompted When Mailer With Alleged Violations Received By PUC's Director Of Oversight


November 24, 2020

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

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National Gas & Electric, LLC would pay a $120,000 civil penalty and contribute $30,000 to PPL's hardship fund under a settlement with the Pennsylvania PUC's Bureau of Investigation and Enforcement ('I&E') to resolve alleged violations resulting from a mailer that allegedly contained confidential information of a PPL Electric Utilities ('PPL') customer, misrepresented savings with NG&E, and included outdated information regarding PPL’s rate

National Gas & Electric said that the information on the mailer giving rise to the alleged violations were said to be due to a mail merge error and a delay in mailing

National Gas & Electric provided the following statement to EnergyChoiceMatters.com:

"While National Gas & Electric is naturally disappointed that our exemplary compliance record has been marred by the unfortunate mail merge error and untimely mail delivery attributed to actions of NGE’s mail house vendor for which NGE has agreed to pay a $120,000 civil penalty, NGE is pleased that this postmark campaign did enable 40 of NGE’s Pennsylvania customers to receive the targeted 25% savings (if their postcard was timely received before December 1) and 30 more customers to receive 17% savings (if their postcard was received on or after December 1) for the harsh December, January, and February 2017-2018 winter weather months, comparing the savings under each postcard receipt date scenario to the June 1-November 30, 2017 Price to Compare of PPL Electric Utilities, Inc. ('PPL').

"We are appreciative that the Pennsylvania PUC was willing to allocate $30,000 of the combined $150,000 settlement amount toward PPL’s hardship fund. During these troubled economic times in the midst of a pandemic, NGE is thankful that this agreed allocation will provide further relief to many of Pennsylvania’s most vulnerable families who have been severely affected by these crises. NGE looks forward to continuing to serve Pennsylvania consumers in the brighter future ahead."

--- Statement from National Gas & Electric

The settlement states, "I&E instituted an informal investigation of NG&E based on information referred to I&E by the Commission’s Office of Competitive Market Oversight ('OCMO'). The Director of OCMO notified I&E that he received a postcard in the mail from NG&E that allegedly contained confidential information of a PPL Electric Utilities ('PPL') customer, misrepresented savings with NG&E, and included outdated information regarding PPL’s rate."

The settlement states, "On December 1, 2017, Daniel Mumford, Director of OCMO, received a postcard in the mail from NG&E."

The settlement states, "The postcard was headlined 'NOTICE OF PPL ELECTRIC RATE INCREASE' and stated that 'PPL’s residential default electric rate increased 14% effective June 1st 2017' and that customers could 'Save 25% compared to PPL’s higher June-November 2017 rate[.]'"

The settlement states, "The postcard also referenced a PPL customer’s name and the last four (4) digits of the customer’s PPL account number."

The settlement states, "Through NG&E’s responses to I&E’s Data Requests, I&E determined that on November 22, 2017, NG&E mailed a total of 155,252 postcards to prospective customers."

The settlement states, "Approximately 90,634 of NG&E’s prospective customers received a postcard that contained a PPL customer’s name and the last four digits of the customer’s PPL account number."

The settlement states, "It is estimated that approximately 2,500 of the prospective customers received the postcard in question after PPL’s December 1, 2017 price to compare decrease."

"In response to the postcards, seventy (70) customers enrolled with NG&E," the settlement states

According to the settlement, NG&E avers that the breakdown of the seventy (70) enrollments is as follows:

A. Forty (40) customers enrolled prior to December 1, 2017 and received 25% savings for at least some period;

B. Five (5) customers enrolled between December 1 and December 4, 2017 and received 17% savings;

C. Thirteen (13) customers enrolled between December 5 and December 20, 2017 and received 17% savings; and

D. Twelve (12) customers enrolled in January 2018 and received 17% savings.

The settlement states, "On December 5, 2017, OCMO contacted NG&E regarding the postcards in question and advised NG&E to cease sending the postcards and to review all enrollments resulting from the inaccurate and outdated information on the postcards to ensure that its customers clearly understood the pricing of the NG&E offer and its comparative relationship to the June-November 2017 PPL default rate as well as to the new December 2017 default rate."

The settlement states, "In response, NG&E informed OCMO that NG&E had already ceased mailing the postcards in question and that it had instructed its agents to point out to customers the date range on the postcard, June-November 2017, and to inform customers of PPL’s new December 2017 default rate of 7.463 cents and the accurate percentage of savings to NG&E’s lowest offer, which became 17% savings instead of the 25% savings based upon the quoted June-November 2017 PPL default rate."

The settlement states, "NG&E alleged that the printing of confidential customer information on the postcards occurred as a result of a mail merge error on the part of the vendor that NG&E used for printing and mailing services."

The settlement states, "NG&E also alleged that the postcards accurately represented the savings compared to the quoted PPL price to compare from June-November 2017, but mis-stated savings with NG&E compared to the new PPL price to compare effective December 1, 2017, and that the postcards contained outdated information about PPL’s price to compare because the delivery schedule for the postcards was inadvertently delayed by the same vendor. According to the Company, the delay is what caused some prospective customers to receive the postcards after PPL’s December 1, 2017 price to compare decrease."

I&E was prepared to allege that NG&E violated provisions of Chapter 54 of the Pennsylvania Code concerning Electricity Generation Customer Choice, 52 Pa. Code § 54.43(d), with regard to the 90,634 postcards that contained the confidential and personal information of a customer.

I&E was prepared to allege that NG&E violated provisions of Chapter 111 of the Pennsylvania Code concerning the Marketing and Sales Practices for the Retail Residential Energy Market, 52 Pa. Code § 111.12(d), with regard to the approximately 2,500 postcards that may have been received after December 1, 2017 and therefore misrepresented savings with NG&E and/or provided inaccurate and untimely information regarding PPL’s price to compare.

Under the settlement, NG&E will pay a civil penalty in the amount of One Hundred and Twenty Thousand Dollars ($120,000.00) and will also contribute the amount of Thirty Thousand Dollars ($30,000.00) into PPL’s hardship fund

As a mitigating factor to the above allegations, I&E acknowledges that NG&E fully cooperated with I&E’s investigation. During the investigatory process, NG&E fully complied with I&E’s requests for information and documentation and timely provided I&E with records, correspondences, and other documents as requested by I&E, the settlement states

NG&E will also take or has taken corrective action and implemented revisions to its operating procedures which will act as safeguards against future distribution of marketing materials that disclose confidential customer information, misrepresent savings, and provide inaccurate and untimely information about rates being offered.

Docket No. M-2020-2637688

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