Texas Retail Provider To Pay $90,000 Under Settlement With PUC Staff To Resolve Alleged Violations Related To Required Disclosures

March 14, 2023

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Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Engie Resources, LLC (Engie) would pay $90,000 under a settlement with Staff of the Public Utility Commission of Texas to resolve alleged violations of 16 Texas Administration Code (TAC) §§ 25.475(c), (e), and (g), related to required disclosures and misleading, deceptive, or unfair practices.

Under 16 TAC § 25.475(e)(1)(A), a REP must provide a customer who receives a fixed-rate electric service product with at least three written notices of the customer’s contract expiration date.

Under 16 TAC § 25.475(e)(2)(C)(ii), if a REP provides a calendar date as the end date for the customer’s contract, the written notice of contract expiration provided to the customer must contain a statement, in bold lettering and no smaller than 12-point font, that no termination penalty must apply to residential and small commercial customers 14 days prior to the date stated as the expiration date in the notice

The settlement states that, "From January 1, 2021 through July 31, 2021, Engie provided 2,179 small commercial contract expiration notices, each of which referenced a calendar date as the contract end date but failed to include a statement notifying the customer of the right to terminate the contract within 14 days prior to the contract end date without the assessment of an early termination penalty."

Under 16 TAC § 25.475(e)(2)(C)(v), the final written notice of a fixed-rate contract expiration date must include a copy of the Electricity Facts Label (EFL) for the REP’s post-term default product.

Under 16 TAC § 25.475(g)(2)(F)(i), which was in effect at the time that Engie issued the final written notices, the EFL for an indexed product was required to include the formula used to determine the price of the indexed product.

The settlement states, "Engie violated 16 TAC § 25.475(g)(2)(F)(i) because the EFL that Engie distributed to 2,179 customers from January 2021 through July 2021, included with this agreement as Attachment B, did not include the formula used to determine the price of the indexed product."

Under 16 TAC § 25.475(e)(2)(C)(vii), the final written contract expiration notice provided to a small commercial customer must include a statement that the default service is month-to-month and may be cancelled at any time with no fee.

The settlement states, "The contract expiration notices provided by Engie to 446 small commercial customers between August 1, 2021 and November 1, 2021 each failed to include a statement that the default rollover service could be cancelled at any time with no termination fee."

The settlement states, "Engie asserts that no termination fee was actually collected from any customer who terminated service while on default month-to-month post-term rollover service."

Under 16 TAC § 25.475(e)(2)(A), to the extent a customer takes no action in response to a REP’s final written notice of contract expiration, the REP must continue to provide retail electric service to the customer pursuant to a default post-term rollover product that is month-to-month and may be cancelled at any time without the assessment of an early termination penalty.

The settlement states, "From January 1, 2021 through July 31, 2021, Engie provided 2,179 small commercial customers with EFLs for Engie’s default month-to-month post-term rollover service, each of which contained an affirmative statement that termination of service was subject to an early termination fee."

The settlement states, "Engie asserts that, in practice, no customer on Engie’s default month-to-month post-term rollover service was ever assessed a termination fee for terminating this service."

The settlement states, "Engie violated 16 TAC § 25.475(c)(1)(A) between January 1, 2021 through July 31, 2021 by providing 2,179 customers with EFLs containing language that was misleading or deceptive because it stated that termination of default rollover service was subject to a termination fee."

Under 16 TAC § 25.475(g)(2)(F)(i), the EFL for an indexed product was required to include the formula used to determine the price of the indexed product.

The settlement states, "From January 1, 2021 through July 31, 2021, Engie provided 2,179 small commercial customers with copies of the EFL for the indexed-rate default rollover plan that did not include the formula used to determine the price of the plan."

The settlement states, "Engie’s default rollover index product formula contained a 'post term fee' which is variable and set at Engie’s discretion."

The settlement states, "From January 1, 2021 through July 31, 2021, Engie provided copies of the EFL for the indexed-rate default rollover service that did not disclose the 'post term fee' used to determine the price."

The settlement describes various corrective actions taken by Engie

The settlement states that the current version of Engie’s expiration notice includes a statement in bold lettering no smaller than 12 point font that no termination penalty must apply to residential and small commercial customers 14 days prior to the date stated as the expiration date in the notice.

The settlement states that the current version of Engie’s expiration notices includes a statement that default service may be terminated at any time without the assessment of a termination fee.

The settlement states that, on November 1, 2021, Engie migrated its default indexed rate rollover price into a variable rate price.

The settlement states that the EFL for Engie’s default variable rate post-term rollover service complies with the requirements of 16 TAC § 25.475.

Docket No. 54723

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