Retail Supplier Recommends New York Require Contracts to Disclose Payment of Fee to Broker

A retail supplier has recommended to the New York PSC that retail supply contracts which are the result of brokering should disclose to the customer that the broker is being paid for its services by the retail supplier.

Specifically, Constellation NewEnergy, which recommended in initial comments on a New York retail market investigation that certain third parties such as brokers should be required to be licensed, said in reply comments that the PSC should require retail suppliers and brokers to include the following language, or substantially similar language, in all customer contracts involving a broker relationship:

Payments to Certain Third-Parties: You acknowledge and understand that:

We are making a payment to [Insert Broker] in connection with its efforts to facilitate our entering into this Agreement; and

Your price reflects the fee we are paying to [Broker].

[Broker] is acting on your behalf as your representative and is not a representative or agent of ours.