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Retail Supplier To Pay $150,000; Issue $400,000 In Refunds Under Settlement

Supplier To Cease Use Of eTPV For Certain Enrollments

Settlement Allows Conditional Resumption Of Residential Door-to-Door Sales

October 6, 2023

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Copyright 2010-23
Reporting by Paul Ring •

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SFE Energy Maryland, Inc. d/b/a SFE or SFE Energy ('SFE'), the Staff of the Maryland Public Service Commission ('Staff'), and the Maryland Office of Peoples Counsel ('OPC') (collectively, the 'Settling Parties') have filed at the Maryland PSC a settlement under which, among other things, SFE would pay a civil penalty of $150,000 and provide $400,000 in customer refunds

The settlement would resolve various allegations against SFE being addressed in Maryland PSC Case 9690

See the prior stories linked below for background on the allegations

January 25, 2023

February 28, 2023

March 20, 2023

Under the Settlement, SFE will increase its level of security on file with the Maryland PSC to $1 million

Under the settlement, SFE shall be permitted to resume residential door-to-door sales upon the implementation of the following new operational enhancements:

A. Database of Local Vendor’s Licenses: SFE shall develop and maintain an electronic database of door-to-door sales agents that sell or solicit SFE’s products and services to Maryland residential customers. The database shall include documentation demonstrating that the agent has obtained licenses required by the local jurisdiction to engage in residential door-to-door marketing.

i. Using the database, SFE shall reject residential enrollments from door-to-door agents that have not obtained required licenses in the prospective customer’s locality.

ii. Before relaunching door-to-door residential marketing in Maryland, SFE shall provide a demonstration of the database to Staff, OPC, and the Commission’s Consumer Affairs Division ('CAD').

iii. Information in the database shall be made available to Staff, OPC, and CAD upon request.

B. Elimination of Use of the Electronic Third Party Verification ('eTPV'): SFE agrees that, for residential door-to-door enrollments, it will discontinue using its eTPV and, instead, utilize a telephone TPV with the customer. SFE’s telephone TPVs shall comply with the definition of 'Third party verification (TPV)' in COMAR and

For two years after the Commission’s approval of the Settlement, SFE: shall not include ETF [early termination fee] provisions in SFE contracts going forward; and shall waive collection of ETFs if a customer cancels and ETFs were allowed in the customer's contract.

SFE will add the following statement on its door-to-door agents’ business cards that are provided to customers at their residence: 'SFE is not your utility. If you have concerns about SFE Energy, please contact the MD Public Service Commission at 410.767.8028.'

With regards to refunds, SFE will pay refunds to various customers in the aggregate total amount of approximately $400,000. The Settlement identifies three subsets of customers that will receive refunds as follows:

a. Refund $56.50 to each of the approximately 3,180 door-to-door residential customers that enrolled with SFE and did not have rescission language in immediate proximity to the signature line in the PDF version of the contract they received via email from SFE upon enrollment, pursuant to the Maryland Door-to-Door Sales Act, Md. Code §§ 14-301 et. seq (CL). The total refund amount paid to these customers is approximately $179,670;

b. To the extent not already paid, refund ETFs paid during the Complaint Period by approximately 719 residential door-to-door customers, totaling approximately $142,800;

c. Rerate the approximate 103 energy assistance customers that SFE returned to utility commodity service on or about July 1, 2023, in compliance with Md. Code § 4-308 (PUA). Re-rates shall be calculated as the difference between the supply charges customers would have received under the applicable SOS or Sales Service rate and the supply charges customers received while served by SFE, less any refunds SFE has already provided to the customer after January 1, 2020. The total refund amount paid to these customers is approximately $78,275

The settlement states, "The Settlement is intended to set forth a full and final compromise of the allegations in Staff’s Complaint filed against SFE, which SFE disputes, and the arguments presented by OPC, which SFE also disputes."

The settlement states, "This Settlement is not intended to be and shall not be deemed to be evidence or an admission of liability on the part of the Settling Parties, or anyone else."

The settlement states, "None of the provisions in this Settlement shall be considered, or shall constitute, an admission, a finding of fact, or a finding of culpability on the part of SFE’s in Case No. 9690 or in any other proceeding."


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