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Retail Supplier Agrees To Additional $100,000 Payment, Forgo Use Of Digital TPV Under Revised Settlement With PUC Staff

March 18, 2024

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Copyright 2010-23
Reporting by Paul Ring •

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Direct Energy Services, LLC and Staff of the Public Utilities Commission of Ohio have entered into an amended settlement agreement to resolve all of the issues identified by Staff in a Notice of Probable Non-Compliance dated June 9, 2021 (Notice Letter), which had alleged, "that representatives of Direct Energy provided misleading and deceptive information to consumers; that Direct Energy failed to maintain accurate records; and that Direct Energy’s enrollment information is incomplete."

Direct Energy provided the following statement concerning the matter:

"We are pleased to have reached an updated settlement with PUCO Staff regarding Direct Energy’s door-to-door and telephone sales activities from three years ago, when NRG acquired Direct Energy. We have since brought Direct Energy under NRG’s sales quality standards and look forward to continuing to focus on serving our customers."

--- Statement from Direct Energy

As previously reported, Direct Energy and Staff had previously entered into a settlement to resolve the matter in June 2022. After the filing of the initial settlement, the Ohio Consumers' Counsel intervened in the proceeding.

Direct Energy and Staff have now agreed to a revised settlement. While not a signatory to the revised settlement, OCC said that it does not oppose the revised settlement

The amended settlement includes two notable terms not present in the original settlement:

1. Direct Energy agrees to make a one-time donation of $100,000.00 to the Dollar Energy Fund to fund grants to be used for bill payment assistance programs for Ohio consumers

2. For a period of 12 months commencing with approval of the Amended Stipulation without material modification, Direct Energy agrees during such time period when enrolling customers in Ohio to not use the digital third-party verification option authorized for it in the September 26, 2019 Entry in Case No. 18-382-GE-WVR and extended in the February 21, 2024 Finding and Order in Case Nos. 17-1843-EL-ORD et al.

Otherwise, the revised settlement's terms follow those of the original agreement. Among other things, the amended settlement still provides that Direct Energy agrees to pay a forfeiture of $275,000.

As before, and as discussed further below, Direct Energy under the settlement agrees to reach out to certain applicable customers and provide them with an opportunity to cancel service without any penalties or re-enroll with Direct Energy

The amended settlement states that Direct Energy has implemented/provided or will implement the actions set forth below as soon as is practicable after the Commission approves the Amended Stipulation:

1. Has provided Staff with a plan to come into compliance with Commission rules. The plan should address, at least, enrollment practices, an auditing process for enrollments, and any corrective actions to be implemented by Direct Energy.

2. Has submitted to Staff a list of all vendors, contact information, and agents that have marketed on behalf of Direct Energy for the period of December 1, 2020 through May 31, 2021. Also include the number of attempted enrollments for the identified agents along with the number of successful enrollments.

3. Has reviewed all door-to-door enrollments completed within the 3 months preceding the Notice Letter, and has taken/will take the following actions:

a. Review each contract, third-party verification, and other enrollment documentation for completeness, accuracy, and customer consent.

b. Contact each customer where enrollment documents are not complete or the customer’s consent is not certain.

c. Give each customer contacted in 3.b. above, the option to cancel without any penalties or to re-enroll with Direct Energy, in which case, new enrollment and consent must be obtained in accordance with Ohio Adm.Code 4901:1-21-06 and/or 4901:1-29-06.

d. Review all customer complaints that noted similar issues with the sales representatives to determine patterns of misleading and deceptive practices.

4. Has provided Staff with telemarketing calls for the period of January 31, 2021 through February 6, 2021, including a listing of all vendors.

5. Has reviewed all marketing and sales scripts for compliance with rules and has submitted updated versions of these documents to Staff for review. If Direct Energy modifies its scripts in the 12 months following the Commission’s approval of this Amended Stipulation, Direct Energy will submit the updated scripts to Staff.

Full details concerning the alleged behavior addressed by the settlement was covered in our prior story here

In brief, in the original Notice Letter, Staff had alleged, "Staff reviewed investigation records from consumer complaints along with information provided by Direct Energy in response to those complaints. The consumer contact records reviewed by Staff included complaints of misleading and incomplete information, and customers disputing their enrollment with Direct Energy. Based on this review, Staff has determined that representatives of Direct Energy provided misleading and deceptive information to consumers; that Direct Energy failed to maintain accurate records; and that Direct Energy’s enrollment information is incomplete."

Case No. 22-583-GE-UNC


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