Pennsylvania PUC Fines Champion Energy $400 for Back-billing Violation

The Pennsylvania PUC has fined Champion Energy Services, LLC $400 for not amortizing back-billed supply charges over the appropriate period.

Due to an internal billing system error, and then because PPL was rejecting Champion's bills due to a canceling bill scenario, Champion's supply charges were not billed to a complainant, on the PPL consolidated bill, for the months of December 2010 through March 2011.

Champion told Matters that it communicated the error to all of its affected customers, and proactively informed customers of the situation.

52 Pa. Code § 56.14 provides that when a make-up bill is issued for previously unbilled utility service, the customer must be given the option of paying it over as long of a period as it was accrued.

An initial decision found that electric generation suppliers are subject to 52 Pa. Code § 56.14 under the Commission's proposed rulemaking at Docket No. L-2010-2208332.

However, PUC Vice Chairman John Coleman, Jr., found it inappropriate to rely on a proposed rulemaking as the basis to apply an existing billing regulation to EGSs. Still, Coleman noted that electric generation suppliers serving residential customers are, through their licensing orders, made subject to the Chapter 56 residential service regulations. The PUC voted 5-0 to approve Coleman's motion to modify the initial decision to reflect these conclusions, which do not affect the substantive outcome of the case, but rather than legal support for the ultimate conclusion.

The PUC affirmed the initial decision's conclusion that Champion did not amortize over the required period the previously unbilled supply charges when included on make-up bills issued in April – July 2011.

The initial decision found a $400 civil penalty to be appropriate given that Champion's violation was not willful, and that no harm ultimately came to the customer as the customer entered into a payment arrangement with PPL, their distribution company. The $400 fine was calculated by applying a $100 fine per month in which the violation existed.

Champion has already paid the fine.

The complaint which gave rise to the back-billing finding also made various other allegations against Champion, but all those claims were denied.

Of note is that during the case the use of email communication for contract expiration notices was contested.

The initial decision found the electronic mailing of notices to be consistent with the term "mailing" in the terms of the service contract, and thus constituted appropriate notice.

However, Coleman said in his adopted motion that, under the circumstances and claims made in the initial complaint, it is not necessary to address whether email notice equates to a "mailing" under the customer's supply contract with Champion (although not clear, presumably the initial decision's finding on this point will be stricken from the final decision under Coleman's motion).

Furthermore, Coleman, "would encourage suppliers using email contract renewal/change notices to, at a minimum, provide advance notice to customers of the intent to use email notice."

The case is C-2011-2256514.