Spark Revises Customer Book Acquisition in Response to Regulator Concerns

Spark Energy will, at this time, acquire a smaller Connecticut customer book from Town Square Energy than originally contemplated, after the Connecticut PURA informed the suppliers that it could not sanction the assignment of certain customers whose contracts PURA interpreted as being expired.

Originally, Town Square Energy informed PURA that it intended to transfer over 4,100 accounts to Spark (customer data as of October 31, 2014)

PURA, however, initially denied the assignment of 1,417 of these customers whose fixed-rate contracts end in November 2014 and 839 of these customers whose fixed-rate contracts end in December 2014, "based on the grounds that the customers' contracts with TSE will have expired prior to the transfer date and therefore, TSE and these fixed-rate customers will not have valid contracts that can be assigned."

PURA's stance is based on its interpretation of fixed price contract language which PURA said, "shows that the agreement between TSE and the fixed-rate customers is the fixed-rate term, and therefore, the agreement expires when the fixed rate ends." Town Square Energy disputes this interpretation.

PURA later said that if the suppliers wished to proceed with the transfer of these 2,250 customers, they would do so at their own risk.

In light of PURA's interpretation, Town Square Energy and Spark informed PURA that they are, at this time, only proceeding with the assignment of the about 1,900 customers to which PURA has not objected.

Regarding the 2,250 customers (as of October 31) that PURA said had no contract and thus could not be assigned, Town Square Energy said that it would pursue the transfer of these customers in January 2015, or later in 2015, "when such customers will be either on new fixed price arrangements that expire at later dates in 2015 or on variable price arrangements."