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Pa. PUC Chair Says PUC Must Pursue Collection of $1 Million Settlement Penalty Against Retail Supplier, Lest PUC Signal "Egregious" Violations Won't Be Punished
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The Pennsylvania PUC rejected the term of a settlement between its Enforcement Staff and a retail energy supplier due to one of the stipulation's terms providing that, due to the supplier's insolvency, the PUC would not seek to collect a $1 million penalty agreed to under the settlement
The PUC was addressing an unopposed settlement between Planet Energy (Pennsylvania) Corporation ('Planet Energy' or 'Company') and the PUC's Bureau of Investigation and Enforcement ('I&E') which included, among other terms, a self-described "token" $1 million penalty to resolve allegations that Planet Energy terminated fixed price contracts (via dropping customers to default service) for about 5,600 customers without various notices required under PUC rules
See background on the alleged violations and settlement here
As previously reported, Planet Energy entered into bankruptcy proceedings, and the settling parties acknowledged that payment of the penalty is unlikely.
As such, I&E under the settlement agreed not to pursue the collection of the $1 million fine due to the remote possibility of collection
Nonetheless, the $1 million penalty was included as a term of the settlement in hopes that the fine would, "illustrate the Commission’s fervent disapproval of Planet Energy’s actions," and to deter future bad actors
However, PUC Chair Stephen DeFrank said that it is inappropriate for the PUC to agree to not even "attempt" collection of any civil penalty, as such inaction could embolden retail suppliers to engage in bad behavior
DeFrank said that the alleged actions of Planet Energy, if proven, would constitute "gross violations" of PUC rules
An agreement by the PUC to not pursue collection, "would signal to other potential bad actors that even egregious business practices
could go unpunished simply because the pursuit of Commission imposed penalties may be difficult," DeFrank said
"Preserving the integrity of Pennsylvania's retail electricity market is an
essential function of this Commission and no entities licensed by this Commission should operate
under the misapprehension that its penalties are meaningless," DeFrank said
The PUC, adopting a motion from DeFrank, modified the settlement to remove the provision stating that the PUC will not pursue collection of the $1 million fine
The PUC will issue a tentative order reflecting such modification. Parties will be given an opportunity to comment on the modification, and settling parties have the right to withdraw from the settlement given such modification. Any withdrawal would return the matter to the PUC's investigative division for further proceedings
DeFrank said in the motion that, under the settlement, Planet Energy would withdraw its retail supplier license and, as stated by DeFrank, "never do business in Pennsylvania again."
While such provision reflects the summary from an ALJ in an initial decision, as noted previously by ECM, the settlement actually provides that Planet Energy agrees not to operate as a supplier in Pennsylvania, "in perpetuity unless otherwise authorized by the PUC" [emphasis added]. Planet Energy under the settlement does not agree to "never" operate in Pennsylvania again (although a proposed ordering paragraph from the settlement had omitted the "unless otherwise authorized..." language, the stipulation's terms themselves as well as a supporting statement make clear that the settlement's term on this matter is not a perpetual prohibition but is perpetual only until such time as the PUC may otherwise order; granted this issue may be moot given Planet's bankruptcy)
Docket No. C-2023-3041126
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November 7, 2024
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Copyright 2024 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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