New York Orders ESCO to Continue Suspension of Marketing to Residential Customers

The New York PSC found that remedial measures taken by Buy Energy Direct, LLC have reduced customer complaints concerning marketing, but because the measures have not yet been proven in the long-term, the PSC ordered that Buy Energy Direct's decision to suspend direct marketing to residential customers should be extended until further Commission action.

Due to customer complaints concerning sales and marketing tactics, the PSC had issued a show cause order to Buy Energy Direct, LLC directing the company to show why its eligibility to offer services as an ESCO in the State of New York should not be revoked.

Among other remedial measures in response to the order, Buy Energy Direct terminated its business relationship with the telemarketing vendor about whom most of the complaints the Department had received, and instituted a new quality assurance plan

Additionally, Buy Energy Direct voluntarily ceased directly marketing to residential customers on August 26, 2013.

"Since Buy Energy terminated active marketing to residential customers the Department has seen a marked decrease in complaints against Buy Energy," the PSC said. "Therefore, Buy Energy should be required to continue the marketing practices and commitments it made in its August 29 Response for non-residential marketing."

However, the PSC concluded that, "[t]he extent to which the practices Buy Energy has implemented are sufficient or even appropriate in the long term to assure Buy Energy's continued compliance with the UBP's marketing practice requirements cannot be determined without continued scrutiny and a longer period of observation."

Accordingly, the PSC ordered that Buy Energy Direct shall be, "prohibited from resuming marketing to residential customers without further Commission action."

"Buy Energy's continued marketing to small commercial customers will provide an opportunity for Staff to observe the effectiveness of Buy Energy's compliance program, particularly its recording and review of all telemarketing sales," the PSC said.

Case 13-M-0331