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Electric Suppliers Would Have To Disclose Rates

by Hugh McQuaid | Apr 1, 2014 4:25pm
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Posted to: Energy, Environment

Hugh McQuaid photo

Gov. Dannel P. Malloy and Attorney General George Jepsen

Electric suppliers will need to meet new price disclosure standards under a package of consumer protections outlined by Gov. Dannel P. Malloy and Attorney General George Jepsen Tuesday.

Electric bills will include a line comparing a customers rate to the standard rate as part of a consumer “bill of rights” that is part of legislation touted by Malloy, Jepsen, and Sen. President Donald Williams at a press conference at senior center in Hartford.

The legislation proposes to:

  • give consumers access to a website listing a company’s highest and lowest rates
  • fix initial, often discounted, electric rates for at least three months
  • allow consumers to switch to a standard rate within 48 hours of requesting a switch
  • allow them to switch to new provider within 30 days of requesting a switch
  • reduce or get rid of early termination fees
  • require companies to get written consent from a customer before using a variable rate
  • give regulators more resources to oversee electric suppliers
  • The announcement comes one day after Connecticut AARP released a study suggesting a majority of residents over 50 years old want to see legislative action aimed at deceptive practices by third-party electrical suppliers.

    “It is clear that greater disclosure in the electric supply market is necessary, not only to protect consumers from bad actors, but also to ensure that electric suppliers better inform customers about the rates they will be paying,” Malloy said.

    Jepsen said the proposals will cut down on opportunities for abuse among electrical suppliers. He said there is “some serious dysfunction” in the energy markets, which the bills aims to curb by increasing transparency and allowing ratepayers to more quickly drop their supplier company.

    “All too often, the business model adopted by certain electric suppliers seems to rely on consumer ignorance and what we call consumer capture, where consumers who want to change their source of electricity cannot do so for a period of time,” he said.

    Consumer Counsel Elin Swanson Katz said it was appropriate the press conference was held at a senior center because she has heard many electric supplier complaints from older residents.

    “The stories I’ve heard, particularly from senior and others, are quite heartbreaking,” she said.

    In a statement, state AARP Director Nora Duncan said she had not yet seen the proposal but was encouraged by Malloy’s remarks. When she released her group’s poll on Monday, Duncan said AARP was trying to ensure the state did not wind up with weak legislation or “Bandaids instead of real fixes.”

    Duncan said AARP considered the proposals released Tuesday a “starting point” and was committed to working with Malloy and lawmakers to pass “meaningful” consumer protections this year.

    “We are also well aware that the devil is often in the details. We look forward to reviewing the proposed bill language and sharing it with our members and older residents to ensure that the proposed reforms address the most common issues facing electric customers,” she said.

    Unlike the governor’s proposals, AARP has called for the legislation to include a cap on how much electric suppliers can increase their rates under variable rate plans. Malloy said rate caps have been discussed and will likely be part of the conversation as the bill moves through the legislative process.

    “There’s been consideration. I think there will be continued discussion of that matter, but as you can see there is widespread consensus on what we’re talking about. We thought it was time to move the package forward,” he said.

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