Texas REPs To Pay $193,000 & Contribute $120,000 To Payment Assistance To Resolve Alleged Violations Resulting From Alleged Disconnections During Term Of Second COVID Relief Program
March 1, 2023 Email This Story Copyright 2010-21 EnergyChoiceMatters.com
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Direct Energy, LP, CPL Retail Energy L.P., and First Choice Power, LLC (collectively, Companies) would collectively pay a $193,200 penalty, and would collectively contribute $120,750 to Direct Energy's bill payment assistance program, under a settlement with Texas PUC Staff to resolve alleged violations of the
PUC's Second Order Related to COVID-19 Electricity Relief Program (ERP) filed on April 17, 2020
A Direct Energy spokesperson provided the following statement concerning the matter:
"This situation resulted from an oversight that occurred during the early days of the pandemic, prior to NRG's acquisition of Direct Energy, First Choice Power, and CPL. We deeply regret that this group of customers was disconnected in error. As soon as the retailers involved realized the mistake, they took immediate steps to have service reconnected. We are pleased to have reached a settlement with the PUC in this matter."
--- Statement from Direct Energy spokesperson
The Second ERP Order, issued on April 17, 2020, prohibited REPs from disconnecting for non-payment the electric service of low-income customers eligible for the COVID-19 ERP until at least July 17, 2020.
The settlement states, "as part of a separate investigation," the Companies determined that they had sent disconnection requests to the TDUs for 762 pre-paid, low-income residential customers who were protected from disconnection under the Second ERP Order
As stated in the settlement, "Companies assert that the disconnection requests occurred due to a manual override that Companies instituted in March of 2020 as a temporary, voluntary protection for low-income customers while the ERP was being developed and implemented by the Commission. The process that was implemented in March created a manual override of disconnection requests through April 30, 2020; however, the override related to pre-paid customers was not updated beyond April 30, 2020 to reflect the revised anticipated end date of the ERP."
The settlement states the Companies provided Commission Staff with the following information:
a. Direct Energy, LP
i. Requested disconnection of 94 customers.
ii. 94 customers were actually disconnected.
iii. Service to 86 customers was restored on the same day disconnection was requested.
iv. Service to 5 customers was restored within four days.
v. 3 customers terminated service with the REP, so service was not restored.
b. CPL Retail
i. Requested disconnection of 20 customers.
ii. 20 customers were actually disconnected.
iii. Service to 20 customers was restored on the same day disconnection was requested.
c. First Choice Power
i. Requested disconnection of 648 customers.
ii. 644 customers were actually disconnected.
iii. Service to 480 customers was restored on the same day disconnection was requested.
iv. Service to 78 customers was restored within four days.
v. 86 customers terminated service with the REP, so service was not restored.
Commission Staff acknowledges that the Companies reconnected nearly 90% of customers within 24 hours after disconnection occurred, and the remainder were reconnected within 96 hours after disconnection
The settlement notes that, on or before July 31, 2020, the Companies added a $50 credit to the account balance of 676 of the customers whose service was improperly disconnected and who maintained active
accounts with one of the three REPs. The remaining 86 customers did not receive a bill
Commission Staff recommends, and the Companies agree, that the Companies will take the following steps in full and final settlement of the matters described herein: within 30 days of the entry of an order approving the settlement agreement, Direct Energy on behalf of the Companies will: (1) pay an administrative penalty of $193,200; and (2) contribute $120,750 to Direct Energy's bill payment assistance program, Neighbor to Neighbor. The contribution to the bill payment assistance program must be above the amount Companies already planned to make in calendar year 2023. These steps will be taken in addition to the $50 credit that the Companies already added to the account balance of 676 of the customers whose service was improperly disconnected.
The settlement states, "Commission Staff asserts, and Companies acknowledge, that Companies' failure to adhere to the Second ERP Order and the attendant interruption of service to low-income customers protected under the Second ERP Order posed a significant risk to the health, safety, and economic welfare of the public. An unexpected disruption of service in the middle of a statewide pandemic, which required individuals and households to isolate at home, caused a serious potential hazard to the health of the public. An interruption in service, in some instances, can result in a loss of function of medical equipment or force individuals out of their homes to seek alternative shelter or to replace spoiled food."