AARP Cautions: "Buyer Beware" When Purchasing Gas and/or Electric Service in New York's Deregulated Energy Marketplace

AARP said in a news release yesterday that it is "very concerned" about recent reports of data showing New York residential customers who bought energy from energy service companies (ESCOs) paid $413 more for electricity and $235 more for natural gas over the past two years, on average, compared with what they would have paid National Grid.

AARP was referring to a comparison of ESCO and default service costs provided during discovery in Niagara Mohawk's current rate cases (click for background).

"On behalf of our 2.7 million members in New York, we sincerely hope this is not a widespread occurrence affecting customers of electric and gas service in other parts of the state," Marilyn Pinsky, AARP New York State President, said.

"AARP is recommending New Yorkers be extremely cautious when switching to an ESCO for their gas and/or electric service. Consumers should always take care to compare rate plans. However, until the New York Public Service Commission (PSC) has had a chance to examine this apparent price discrepancy in the marketplace, consumers should exercise extra diligence when evaluating gas and electric rate plans."

"Furthermore, we believe the PSC should, at a minimum, provide more effective tools to allow consumers to make price comparisons between ESCOs and their local utility company so they can gauge how much money they may or may not save if they switch service providers. In addition, we suggest re-examining their 'Power to Choose' website and instituting a bill calculator that allows for price comparisons," Pinsky said.

Such measures have been proposed by various consumer interests in testimony (see prior story)