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Texas Retail Provider Would Pay $93,000 Under Settlement With PUC Staff, Already Issued $1.4 Million In Refunds
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Value Based
Brands LLC d/b/a 4Change Energy (VBB) would pay $93,007 under a settlement with Staff of the Public Utility Commission of Texas to resolve alleged violations of 16 TAC § 25.475, related to requirements for issuing contract expiration
notices.
Under 16 TAC § 25.475(e), for contracts entered into prior to September 1, 2021, a REP
shall send a written notice of contract expiration at least 30 days or one billing cycle prior
to the date of contract expiration, but no more than 60 days or two billing cycles in advance
of contract expiration, for a residential customer, and at least 14 days but no more than 60
days or two billing cycles in advance of contract expiration for a small commercial
customer.
The settlement states, "Between May 14, 2022, and August 11, 2022, VBB violated 16 TAC § 25.475(e) 9,947
times by failing to timely issue a contract expiration notice for customer contracts entered
prior to September 1, 2021."
Under 16 TAC § 25.475(e)(1)(A), for fixed rate contracts entered into after September 1,
2021, a REP must provide the customer with at least three written notices of the date the
fixed rate product will expire. The notices must be provided during the last third of the
fixed rate contract period and in intervals that allow for, as practicable, even distribution
of the notices throughout the last third of the fixed rate contract period.
The settlement states, "Between May 14, 2022, and August 11, 2022, VBB violated 16 TAC § 25.475(e)(1)(A) 995 times by failing to timely issue contract expiration notices for customer contracts
entered on or after September 1, 2021."
The settlement states, "VBB asserts that the violations resulted from the suppression of contract expiration notices
from a cohort of customers who consented to receive notices electronically. The suppression of these notices was not intentional and occurred due to an IT project with a
customer service focus. Specifically, VBB maintains that the code change was intended to
improve the customer experience and to suppress any emailed contract expiration notices
for only those customers who had proactively renewed on a new plan during the current
renewal window. The code change initially had an unintended broader scope that included
in the suppression any customer who had renewed at any point in the customer life cycle
instead of only including those proactive renewals during the current expiration window."
The settlement states that VBB issued over $1.4 million in credits and refunds to affected customers whose contracts
expired and were charged a higher variable rate as a result.
"VBB identified the issue itself
and initiated efforts to make customers whole through these refunds in compliance with 16
TAC § 25.475(e)(1)(C) on its own initiative prior to any outreach by Commission Staff," the settlement states
The settlement states that VBB asserts it has implemented the following measures to prevent future violations of 16
TAC §§ 25.475(e) and 25.475(e)(1)(A) from occurring, and will continuously work to
implement measures designed to prevent errors going forward:
a. Processing of contract expiration notices has been moved to a more robust and
reliable SaaS platform that identifies real-time anomalies between customers that
are expected to receive a contract expiration notice and notices that are actually
sent.
b. In addition to the more robust system controls, a manual weekly audit is also
conducted as a redundancy to verify that the emails sent match the targeted
segment. If there is any discrepancy further investigation is initiated.
c. Expiration segments (i.e., the group of customers whose contracts are expiring
within each month) along with detailed email activities (sends, deliveries, opens,
clicks, bounces, etc.) are consolidated into a comprehensive Tableau Dashboard
that provides a detailed view of performance metrics that can be viewed down to
the customer level which assist in identifying suppression of notices.
Docket No. 56248
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February 28, 2024
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Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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