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Retail Suppliers Allege Data From Utility Seeking To Restrict POR, "Raises Troubling Questions About What Appears To Be Targeted And Discriminatory Terminations Of Shopping Customers"
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In a brief opposing a non-unanimous settlement in the default service proceeding of FirstEnergy Pennsylvania ("FirstEnergy" or "FE PA"), which would prohibit purchase of receivables for retail supplier plans with rates higher than the price to compare, Town Square Energy East, LLC (TSE) and WGL Energy Services, Inc. (WGES) alleged in a joint brief that, "a closer look at FirstEnergy’s data raises troubling questions about what appears to be targeted and discriminatory terminations of shopping customers."
The settlement entered into by FirstEnergy Pennsylvania Electric Company, the Office of Consumer Advocate, and certain other parties, which had been first reported by EnergyChoiceMatters.com, would provide, for all contracts entered into after June 1, 2027, that POR would be limited to products whose rate is at or below the price to compare at the time of enrollment
See full details on the settlement here
TSE and WGES said in a joint brief that, "FirstEnergy says that ending POR for EGSs that charge prices higher than the PTC would substantially reduce its customers’ exposure to 'unreasonable EGS-driven uncollectible expenses'. In fact, the only justification provided by FirstEnergy for its POR proposal was the supposedly 'unreasonable EGS-driven uncollectible expenses'. But when FirstEnergy was asked to provide details about its uncollectible expenses, it admitted that residential and commercial customers also pay for uncollectible expenses from default service as well as from POR uncollectibles."
"In fact, FirstEnergy’s data responses show that accounts served by default service are actually contributing more to uncollectible expenses than accounts served by suppliers," TSE and WGES said
TSE and WGES further argued that, "Another problem with FirstEnergy’s 'uncollectibles' justification is that the modest rise in POR-related uncollectibles since 2022 is far outpaced by the rise in Default Service uncollectibles during that period, and by the rise in the PTC during that same period. According to FirstEnergy’s Exhibit DMY-11, system-wide POR-related uncollectibles rose by approximately 23% between 2022 and 2025. The same chart shows that system-wide Default Service uncollectibles rose by approximately 31% during the same time frame. Meanwhile, during the same time frame the PTC rose by at least 78% in each rate district, as shown on Exhibit RM-2."
"It bears repeating that the impact of EGS uncollectibles was the sole justification that FirstEnergy gave for its POR proposal, but the data makes its [sic] clear that the both the PTC and the rate
of Default Service uncollectibles have risen much more significantly than the rate of EGS uncollectibles," TSE and WGES said
While settling parties have cited higher termination for customers served by a retail supplier as illustrating the need for the POR changes, TSE and WGES alleged, "a closer look at FirstEnergy’s data raises troubling questions about what appears to be targeted and discriminatory terminations of shopping customers."
While testimony from the Coalition for Affordable Utility Services and Energy Efficiency in Pennsylvania (CAUSE-PA) indicates that, in raw numbers, FirstEnergy PA is terminating many more shopping customers than non-shopping customers each year, TSE and WGES alleged that, "these termination numbers are grossly out of line with all of the other metrics that FirstEnergy provided regarding payment trouble and arrearages."
TSE and WGES alleged:
• "FirstEnergy’s response to CAUSE PA I-7, Attachment-A was admitted into the record as RESA Exhibit FL-29. The attachment shows the number of 'payment troubled' customers by category for the years 2022-2025. The attachment shows that in every year, most of the 'payment troubled customers' were on default supply, and far fewer were shopping customers.
• "FE response to CAUSE PA 1-6, attachment B was admitted into the record as RESA Exhibit FL-28. The attachment is a report of residential 'write offs' for the years 2022-2025. It shows that nearly none of the write-offs were related to shopping customers, and nearly all were customers on default supply.
• "FirstEnergy’s data responses also show that of all accounts with balances over $10,000 in its service territory, less than 5% of those arrearages are attributable to supplier charges.
• "Yet, in the West Penn Power rate district, First Energy was terminating two to three times more shopping customers as non-shopping customers in 2022-2025 according to [CAUSE PA] Table 7, in real number terms, not percentages. During that period, FirstEnergy terminated over 15,000 shopping customers per year in West Penn Power rate district, compared to approximately, 6000 default service customers, even though there were 3-4 times more payment troubled default service customers than shopping customers in that rate district according to Exhibit FL-29."
TSE and WGES alleged, "These statistics, which were provided by FirstEnergy directly, raise serious questions about why so many shopping customers’ service was terminated compared to default service customers. FirstEnergy’s own statistics show that the company is terminating shopping customers at a MUCH higher rate than default service customers, even though default service customers have much higher percentages of payment troubled customers, write-offs, and arrearages over $10,000."
TSE and WGES alleged, "FirstEnergy admitted in its discovery responses that prior to preparing its POR proposal, it had not done any analysis of arrearage levels, write offs, collection rates, or termination rates for shopping versus non-shopping customers. FirstEnergy also admitted that it had not tracked the number of payment arrangements, disconnection notices, disconnections, or bad debt for default customers vs. shopping customers. Furthermore, FirstEnergy’s testimony does not quantify how much of the Company’s POR-related uncollectibles are actually attributable to EGS pricing as opposed to broader economic conditions affecting all customers."
In a brief, FirstEnergy PA said that, "POR-related uncollectible expense disproportionately contributes to the
Company’s overall generation-related uncollectible expense relative to the share of
shopping customers. For example, as [FE PA witness] testified, from 2022 to 2025, on
average, 40% of FE PA’s total residential generation uncollectible expense was attributable
to purchased EGS accounts receivable even though only 18% of residential customers were
shopping over that same period."
FirstEnergy PA said that, "a substantial number of EGSs
serving FE PA customers continue to charge prices 1.5 times higher than the PTC and
generate POR-related write-offs well above the average for the entire EGS population
notwithstanding clawback charges. In addition, even for those EGSs identified by its
two screening measures, the clawback charge recoups only a small fraction of the
uncollectible accounts those EGSs generate."
In a brief, the Coalition for Affordable Utility Services and Energy Efficiency in Pennsylvania ('CAUSE-PA') said, "Average uncollectible expenses associated with shopping accounts across FE PA’s four rate districts ranged between $23-38 per customer in 2025, compared to $8-$15 per customer for uncollectible expenses associated with default service accounts."
As first reported by ECM, the settlement would also require that fixed price customers be dropped to default service at the end of a fixed price term unless the customer provides affirmative consent to continue with their retail supplier. The settlement would also require suppliers to obtain, on a quarterly basis, affirmative consent from variable rate customers in order for an EGS to continue service to such customers
In briefs, retail suppliers argued that such proposals are inconsistent with Pennsylvania's electric choice statute.
The Retail Energy Supply Association said, "FE PA's proposal also conflicts with one of the Competition Act's most
fundamental customer protections -- the requirement that a customer's electric generation
supplier may not be changed without the customer's authorization."
RESA said, "The proposal asks the
Commission to disregard the EGS customer's previously expressed choice to receive
generation service from an EGS and instead treat the EGS customer's failure to take
action in response to contract renewal notices as authorization to transfer that customer to
default service. That premise is inconsistent with both the Commission's longstanding
interpretation of its contract renewal regulations and the Competition Act's prohibition
against unauthorized switching of electric generation suppliers.95 Importantly, nothing in
the Competition Act authorizes the Commission to substitute its judgment -- or an EDC's
judgment -- for the [EGS] customer's own competitive generation choice simply because
the customer did not take a further action in response to the EGS’s contract renewal
notice."
While FirstEnergy PA has sought a waiver of PUC rules [such as 52 Pa. Code 54.10] to implement the proposal to drop fixed customers to default service if the customer does not affirmatively renew, the retail suppliers argued that such a policy cannot be granted through a rule waiver, as the proposal amounts to a rule change which is sought to be accomplished outside of the necessary rulemaking process
TSE and WGES alleged that the fixed rate change proposed by FirstEnergy Pennsylvania departs from existing rule so materially that, "FirstEnergy is proposing to amend or repeal the regulation at 52 Pa. Code 54.10, not request a waiver from it."
TSE and WGES cited PUC precedent which provides that rule waivers must be, "narrowly crafted and generally temporary in nature," which TSE/WGES argued is not the case for FirstEnergy PA's sought change
TSE and WGES also took aim at settling parties' "affordability" justifications for settling parties' proposed changes, as TSE and WGES argued that settling parties seek to end a program proven to reduce customer bills -- the customer referral program (CRP)
Of the CRP, RESA said that, "FE PA’s own discovery response demonstrates that participating
[CRP] customers achieved cumulative savings of more than $750,000 compared to the
applicable Price to Compare across the FE PA service territories during the period
analyzed by the Company, from January 2025 through February 2026."
TSE and WGES alleged that, "the FirstEnergy PTCs have risen consistently and dramatically over the past 5 years, and the PTC has more than doubled since March of 2021 in three of the four FirstEnergy rate districts ... The simple truth is that in times of consistently rising PTCs and concerns about customer affordability, it is disingenuous for FirstEnergy and the other retail market opponents to argue for the elimination of a program that has consistently provided customers with the opportunity to save money with no demonstrated ongoing cost to FirstEnergy."
In a joint brief, Shipley Choice, LLC and Interstate Gas Supply, LLC succinctly stated as follows concerning the fixed price, variable rate, and POR proposals from the settling parties: "All three of these 'market killer' proposals are illegal and ill-advised."
Settling parties' briefs largely repeated positions and evidence previously cited in the settlement itself and settling parties' previously reported statements of support (see details here)
Concerning POR, the Coalition for Affordable Utility Services and Energy Efficiency in Pennsylvania (CAUSE-PA) said in a brief that, "the record contains unimpeached evidence that residential shopping customers have been charged over $888 million more than the applicable price to compare over a 100-month period, from August 2017 through December 2025. This is an aggregate charge, factoring in all the rates charged to residential customers during this time. On an average per customer basis, residential customers are consistently charged hundreds of dollars more each year compared to the applicable default service price."
CAUSE-PA said, "on an average per customer basis from 2022 through 2025, across all four divisions, confirmed low income shopping customers were charged a price premium between 31-42% above the default service price, while confirmed low income shopping customers were charged a price premium as high as 56% above the applicable default service price."
CAUSE-PA alleged, "The current paradigm, allowing suppliers to charge a different rate at the end of a contract term without informed consent, is undeniably driving higher rates of termination and uncollectible expenses among residential shopping customers".
Docket P-2026-3060298
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Retail Suppliers Argue Al Three "Market Killer" proposals From Pennsylvania Utility Are, "Illegal And Ill-Advised"
July 14, 2026
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Reporting by Paul Ring • ring@energychoicematters.com
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