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House Gives Final Passage to Consumer Protections

by Christine Stuart | May 5, 2014 4:36pm
(6) Comments | Commenting has expired
Posted to: Energy, Environment

Christine Stuart photo

Rep. Lonnie Reed debates the bill. Rep. Jonathan Steinberg listens

The House of Representatives gave final passage Monday to legislation that requires more transparency from third-party electricity suppliers and reduces deceptive marketing tactics to residential customers.

The bill, which passed 145-0, will require suppliers to maintain their initial sign-on electric rates for at least three months. It also requires that electric bills include the standard rate, so consumers can compare it with the rate they’re paying. The legislation also gives customers greater flexibility to drop their electric supplier and forces suppliers to give more frequent notice about variable rates.

Gov. Dannel P. Malloy applauded the passage of the legislation.

“This bill will help put an end to misleading and deceptive marketing practices,” he said in a statement. “It will give our families the information they need to evaluate pricing options offered by electric retailers and to choose the plan that is best for them and their pocketbooks.”

Advocates like those from the AARP wanted the legislation to go further by capping variable rates and defining how those rates are calculated.

“While the bill does provide some much needed transparency, it doesn’t go far enough to stop the kinds of abuses our members, and other state residents, have complained the most about,” Nora Duncan, AARP state director, said. “We will continue to work with policymakers to address these issues over the next year to ensure that the market works for consumers, and help them keep more of their hard-earned money where it belongs . . . in their pockets.”

Rep. Jonathan Steinberg, D-Westport, offered an amendment that would have, among other things, capped the variable rates, but withdrew it before a vote.

The “underlying bill is great, it just doesn’t go far enough,” Steinberg said.

But most lawmakers on both sides of the aisle felt the legislation was a step in the right direction.

Rep. Lonnie Reed, D-Branford, said she also went into the session angry, wanting to cap rates, but then she realized “these are businesses that are providing products and competing among themselves.”

“We didn’t want to be punishing the bad actors, by killing the industry,” Reed said. “We wanted to work with the good companies to help them create a better education sense.”

Consumers turned out for public hearings across the state earlier this year to voice their concerns about the marketing practices of some of these third-party suppliers. Some of those suppliers offered low introductory rates, which soon disappeared, causing consumers’ electricity bills to skyrocket.

Reed said some consumers don’t want to tolerate any risk, but there are others who get enthusiastic about it.

Rep. Laura Hoydick, R-Stratford, said the bill includes a provision that forces suppliers to tell customers if their rate will increase 25 percent. It also includes a 72-hour cancellation provision.

Rep. Vincent Candelora, R-North Branford, who saw his company’s gas bill go from $6,000 a month to $35,000 a month, said he wished the bill applied to more than just electricity suppliers. He said it should apply to all energy brokers in both the residential and commercial marketplace.

But at the end of the day Candelora said he was happy to see residential consumers get the protection they deserve.

Reed said she expects that more “teeth” will be added to the effort once the state ends settlement negotiations with an unnamed entity. She said the settlement, which is expected to bring in millions of dollars to the state, will help the Public Utility Regulatory Authority hire three to four more people to enforce the new regulations.

Reed was unable to be more specific about the negotiations, but said language to enhance enforcement efforts will be added to one of the budget implementation bills.

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(6) Comments

posted by: Bluecoat | May 5, 2014  5:05pm

“Rep. Lonnie Reed, D-Branford, said she also went into the session angry wanting to cap rates, but then she realized “these are businesses that are providing products and competing among themselves.””

Isn’t this part of the problem for Democrats, going into the session angry?
As if every business owner is out to screw someone. This is why we get legislation proposed by the Left Wing CT Wizards of Smart like Betsy Ritter of Waterford, who last year proposed a hoarder tax on businesses.
We have to be the dumbest generation that ever lived. Letting these 60’s generation wizards, most of which never worked in the private industry, legislate and micro manage everything. Get out of the way, repeal the income tax, and let the small business owner invest in himself/herself, his/her future, and the economy will grow faster.

posted by: Noteworthy | May 5, 2014  8:06pm

How about passing legislation protecting taxpayers? Oh, and about that “transparency” thing - it might be best to understand the concept and practice it yourself before legislating it for others.

posted by: DrHunterSThompson | May 5, 2014  11:29pm

DrHunterSThompson

This is a baby effort.  No teeth, no balls.  Consumers need refunds from the screwing they took this year, some sort of cap is a good idea, penalties are not bad ...... these companies have discovered the loopholes in the bad lawmaking of the past - they need to be corrected.

this does not do it.

HST

posted by: timelord | May 6, 2014  11:20am

Nobody has a legitimate complaint about their rate increasing.  All of the terms were clearly spelled out when homeowners chose the plan.  But that doesn’t mean that some improvements can’t be made without punishing suppliers for consumers’ laziness or stupidity.

These two changes would solve most of the problems.

1) If a contracted rate expires and the new rate will be higher than the standard rate then the homeowner should automatically be switched back to CL-P and the standard rate.

You can’t cap the 3rd party suppliers’ rates because they might not be able to meet that rate without losing money.

2) When a consumer changes plans it should become effective with the next billing cycle (or even sooner, maybe 10 or 15 days). 

Currently switching providers usually takes 2 complete billing cycles. I once switched plans and my new supplier didn’t show up for 4 billing cycles. They blamed CL-P and CL-P said it had nothing to do with them. You can’t fight city hall?  No, the saying should be “You can’t fight a utility company.”

posted by: timelord | May 6, 2014  11:25am

@DrHunterSThompson, as usual you’re terribly confused. Nobody took a screwing. The rate contracts are clear as to their terms. If a consumer is too lazy or incompetent to honor a contract that they signed voluntarily then they should just stick to the standard plan. There were no suppliers that were bad guys, and as we heard, several of them gave advance notice of upcoming rate expirations - including the supplier I was with. They were under no obligation to do that; it was just good customer service.

posted by: Fisherman | May 6, 2014  8:30pm

Great shot of Lonnie Reed… as I am writing this, she is advancing a bill which lets cable companies charge ninety-six (96) percent per year in interest on late bills!