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Retail Suppliers Owned By NRG To Provide $50 Million In Billing Adjustments Under Settlement Resolving Allegations Against 9 Retail Suppliers
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Retail suppliers owned by NRG Energy will provide billing adjustments totaling $50 million and will undertake other remedial actions under a settlement adopted by the New York PSC to resolve a show cause order previously issued by the New York PSC against nine NRG retail energy suppliers
Brian Curci, Executive Vice President & General Counsel, NRG Energy, Inc., provided a statement in response to the PSC's ruling
Curci stated, "We believe this agreement presents a strong opportunity to answer the Governor’s call for affordable energy by offering guaranteed savings and bill pay assistance to longstanding customers of the NRG brands in New York."
"We would rather use our resources to help our customers with their electric and natural gas bills during this time of rising energy costs than spend years litigating a disagreement over the Commission’s Order clarifying the applicability of the Market Reset Order to pre-existing customer contracts. So, I reached out to my counterpart at the Department of Public Service to initiate discussions about providing immediate bill payment relief and ongoing savings to customers," said Curci.
"We believe NRG was fully compliant with the Commission’s guidance under the Market Reset Order," said Curci.
The $50 million in billing adjustments will be provided to all current and former NRG retail "legacy" customers (mass market customers which were being served prior to the PSC's market reset order) who continued to be served on their existing products after the effective date of the PSC's retail energy market reset order. DPS Staff has alleged that service to such legacy customers should have transitioned to a product authorized under the PSC's retail market reset order.
The $50 million in billing adjustments will be provided to 278,000 current and former residential and small commercial customers
Additionally, under the settlement, NRG's Direct Energy Services, LLC retail supplier will offer a guaranteed savings product, for a term of 12 months, to all eligible current and former NRG "legacy" customers, that will provide 15% savings versus the utility supply cost. Per DPS Staff, this offering has an estimated value of up to $21 million. Direct Energy Services, LLC will only move such legacy customers to the guaranteed savings plan upon obtaining affirmative customer consent.
While not cited during a discussion at the PSC's meeting today, a news release from New York Governor Kathy Hochul stated that, to the extent the legacy customers are not enrolled onto the guaranteed savings product described above, the mass market legacy customers will be returned to utility supply service
A copy of the settlement agreement and written PSC order were not immediately available; the descriptions herein are based on the discussion at a PSC session and the governor's news release
NRG will also make payments totaling approximately $919,000 to certain low income customers, and will return these specific low income customers to default service.
PSC Chair Rory Christian said that the PSC's action sends an "unmistakable" signal to ESCOs concerning compliance
"The Public Service Commission remains vigilant in holding all companies in its jurisdiction accountable," Christian said
PSC Commissioner David Valesky also stressed the need for compliance audits of ESCOs, noting that the broader show cause order to the NRG ESCOs ultimately resulted from investigations which started based on the results of a routine audit of a specific compliance obligation
The now-approved settlement agreement resolves all alleged violations against the nine NRG ESCOs originating from the September 23, 2025 order to show cause.
As more fully discussed in ECM's prior story on the prior order to show cause (full details here), DPS Staff had generally alleged, among other allegations, that NRG failed to "transition" customers to products which complied with the PSC's 2019 retail energy market reset order.
As previously reported, NRG's response to an initial Notice Of Apparent Violation was filed on a confidential basis with respect to any substantive arguments made by NRG. Furthermore, as a result of various extensions, NRG had not yet provided a response to the order to show cause. Thus, NRG's specific position regarding its interpretation of the PSC's reset order is not in the public record. NRG had said in a September 23, 2025 media statement concerning the order to show cause that, "we fundamentally disagree with the Order’s [order to show cause] premise[.]"
Although NRG's record interpretation of the market reset order is not public, ECM itself observes, without attributing such following argument to any position potentially taken by NRG, that the PSC in a September 2020 "clarification order" had, in the context of rebutting ESCO arguments that the market reset order constituted an unlawful taking, said that the reset order does not, "retroactively regulate[] Direct Energy’s existing contracts."
The PSC in such September 2020 clarification order had further stated, "the December 2019 [reset] Order only applies to prospective contracts."
Specifically, the PSC in a September 18, 2020 Order On Rehearing, Reconsideration, And Providing Clarification, had stated as follows: "Direct Energy argues that there has been a regulatory taking in regard to its existing contracts, but that argument is based on Direct Energy’s inaccurate assertion that the December 2019 Order retroactively regulates Direct Energy’s existing contracts. Since the December 2019 Order only applies to prospective contracts, Direct Energy’s argument lacks merit."
Additionally, while NRG's positions do not appear to be part of the public record, from the PSC's prior discussion in the prior show cause order, the cases had presented two issues notable to the broader retail market, which will now potentially not be addressed in a precedential manner due to resolution of the show cause order via settlement rather than litigation (unless the PSC takes the opportunity in an order on the settlement to address the issues notwithstanding that the matter is being settled; as noted above a written order was not posted as of publication time)
First, from the PSC's show cause order, it appears that the NRG suppliers may have argued that certain contracts, which were entered into prior to the December 2019 reset order, had remained in effect, including when and after such contracts are auto-renewed. The NRG suppliers thus appeared to argue that such contracts are not subject to the reset order's compliant product provisions.
Second, it appears that DPS Staff alleges that reward programs offered by ESCOs to existing customers are in violation of the reset order, due to being, in Staff's view, non-energy-related value-added products and services which are meant to induce a customer's enrollment
However, the PSC's 2019 reset order specifically provided that, "ESCOs are prohibited from offering them [non-energy-related value-added products and services] to
prospective customers as inducements to sign a contract. " [emphasis added]
While, as noted below, the 2019 reset order did broadly find that non-energy-related value-added products and services provide no value, the PSC's language prohibiting the offering of such was explicitly stated as, and only as: "ESCOs are prohibited from offering them to
prospective customers as inducements to sign a contract." [emphasis added]
More specifically, the 2019 reset order contained the following provision:
"Non-Energy-Related Value-Added Products and Services
"Value-added products and services that have no energy-related benefit and/or that are offered as a one-time promotion
do not further the energy policy goals of the State and,
therefore, provide no value in the context of the retail energy
market. These promotional items, such as gift cards or other
'swag,' are frequently offered as promotions to induce customers
to sign a contract with the ESCO. However, the market value of
these items often is significantly less than the price the
customer ultimately pays for the item or service over the term
of the contract. Accordingly, because these promotional items typically do not provide any energy-related benefit to
customers, ESCOs are prohibited from offering them to
prospective customers as inducements to sign a contract.
In another section of the 2019 reset order, reciting the then-current market, the PSC was more broad in listing non-energy-related value-added products and services, and listed items which potentially could be both sign-up bonuses as well as loyalty rewards (frequent flyer miles, sports tickets, gift cards), but in such discussion, the PSC, while finding no value to such offerings, did not explicitly prohibit every enumerated item, in contrast to the explicit prohibition on the offering non-energy-related value-added products and services to
prospective customers as inducements to sign a contract, as noted above
Specifically, the 2019 reset order does state:
"[T]o the
extent that any value-added products and services are available
to New York customers, those products and services are, by and
large, not energy related. Rather, they are typically products
that are more accurately described as marketing devices or onetime offers intended to induce customers to enroll with the
ESCO. The items -- such as frequent flyer miles, gift cards,
sports tickets, LED light bulbs, and 'smart' thermostats --
frequently have a market value that is much lower than the
amount customers ultimately pay to the ESCO over the course of
the contract in excess of what they would have paid to the
utilities. Moreover, many of the aforementioned items have
nothing to do with providing energy services and therefore serve
none of the goals of the energy retail market. As to the items
that have a tangential relationship to energy services –
lightbulbs, thermostats, etc. - these items offer little or no
value for the purposes of the energy retail market given that
customers can easily purchase these items outside of that
market; we find no convincing proof that customers receive any meaningful value when these easily accessible retail items are
tethered to the receipt of commodity energy."
For its part, the PSC in the show cause appeared to agree with Staff's stance on interpreting the 2019 reset order as providing a broad prohibition on non-energy-related value-added products and services, notwithstanding the order's specific language
In the order to show cause issued in Sept. 2025, the PSC summarized the 2019 reset order as providing that, "to ensure mass market customers received value from the retail energy market, the Reset Order instituted a prohibition on non-energy-related value-added products and services. The Commission observed that these products, which often take the form of gift cards or 'swag' to induce customers to sign contracts with ESCOs, frequently have a market value that is significantly less than the price the customer pays for that item or service and do not further the State’s energy goals. The Commission, therefore, determined that those products do not provide any energy-related benefit to mass market customers."
In such 2025 pronouncement, the PSC footnoted to the language from the 2019 reset order quoted above (which is specific to prospective customers as inducements to sign a contract), and not any other language from the 2019 order or any clarification or reconsideration issued by the PSC
DPS Staff had alleged that NRG's XOOM brand had improperly offered non-energy-related value-added incentives by advertising and enrolling New York customers in its 'XOOM Xtras' rewards program.
The order states, "This program apparently promotes the use of rewards points to earn gift cards and other rewards."
Staff alleged that these rewards points are inducements to encourage customers to "enroll and remain" on XOOM service.
A news release from New York Governor Kathy Hochul stated that the companies included in the settlement agreement are Gateway Energy Services Corporation, Energy Plus Holdings LLC, Energy Plus Natural Gas, LLC, Direct Energy Services, LLC, Green Mountain Energy Company, Reliant Energy Northeast LLC, Stream Energy New York LLC, XOOM Energy New York LLC, and NRG Business Marketing, LLC.
Per the Governor's office, these nine ESCOs, on a combined basis, currently serve more than 120,000 electric customers and more than 40,000 gas customers in New York State.
Case 25-M-0516 et al.
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April 16, 2026
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Copyright 2026 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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