Direct Energy Caps Residential Variable Rates in Massachusetts

Direct Energy announced that it is adding a price protection feature to its current residential electric variable rates in each Massachusetts utility service area in which the company operates.

Direct Energy’s price protection level for its residential electric variable rates in Massachusetts is 16.6 cents per kilowatt-hour, and the company is committing to this price protection level for the May-October period. Direct Energy’s specific maximum variable rate with price protection is for the National Grid Massachusetts Electric utility area, where Direct Energy serves residential customers.

The residential electric variable price protection levels are the absolute highest rates pending any future regulatory or legislative changes that impose greater costs on retailers. The residential electric variable rate price protection does not include incremental services procured including but not limited to: green products, rewards, home services, or other non-energy related items.

After the initial six month period, to the extent that Direct Energy determines it needs to adjust its price protection level, Direct Energy also commits to provide its residential customers with a minimum of 30 days advance notice prior to making a change so that customers may make informed decisions regarding which plan is right for them.

Direct Energy also proposed the following retail market reforms:

• "A new standard for retail suppliers to offer residential variable electric rates with price protection. Direct Energy believes that all retail suppliers should provide a specific cents-per-kilowatt-hour maximum variable rate for any residential variable electric price products and provide customers 30 days advance notice of any changes the retail supplier makes to that price protection level. This gives customers the ability to make better budgeting, shopping and switching decisions."

• "Clearer customer disclosures. Direct Energy believes all suppliers should be required to identify and communicate clearly to customers all pricing and term information, any early termination penalties and the details for how the supplier will serve the customer after the expiration of any initial contract period."

• "Accelerated switching to retail suppliers. Currently, when a customer wants to change retail suppliers, the process can take one to two billing cycles to complete. Direct Energy supports working with stakeholders to make efforts to ultimately move to a same-day switch model that will directly benefit electricity consumers seeking alternative pricing option."

• "Full smart meter deployment and timely access to usage data. Smart meters enable retail suppliers like Direct Energy to offer advanced products and services. This not only fosters greater customer empowerment and engagement but also gives customers more control of their energy usage and bills. Direct Energy already offers several innovative products that use smart technology to help customers manage their energy use, which can be particularly helpful during unpredictable weather conditions. Full smart meter deployment would enable Direct Energy and other suppliers to offer more of these types of products and services across the state."

"In addition to these priority areas, Direct Energy also supports enhancements that include increasing the financial fitness standards for retail suppliers, stronger enforcement against suppliers and sales representatives that violate customer protection regulations, and new measures to promote fixed price contracts," the company said