Changes to State Law Regarding Electricity Market will Benefit Connecticut Consumers [Governor’s Office Release]

“Electric Supplier Consumers’ Bill of Rights” In Effect as of July 1st

From the Governor’s Office

(HARTFORD, CT) – Governor Dannel P. Malloy today announced that as of July 1st several changes to laws concerning Connecticut’s electricity market will have gone into effect, creating greater transparency and increasing protections for residential consumers by requiring electricity suppliers to provide very clear and specific information about how much they are being charged for electricity. The changes stem from a legislative package – known as the “Electric Supplier Consumers’ Bill of Rights” – which Governor Malloy introduced in the 2014 legislative session of the General Assembly to address the growing number of consumer complaints about spiking prices, deceptive practices and lack a of disclosure about rates and contract terms in Connecticut’s electric supplier market.

“This ‘Bill of Rights’ will help put an end to misleading and deceptive marketing practices by giving Connecticut consumers the information and resources they need to shop around for the best price, choose the electric retailer that works best for them and, ultimately, to save money on their monthly electricity bill. I’ve said it before but I’ll say it again, this is all part of our commitment to ensuring our residents have access to cheaper, cleaner, and more reliable power,” said Governor Malloy. “I’d like to thank Attorney General George Jepsen, Senate President Don Williams, Speaker Brendan Sharkey, Consumer Counsel Elin Swanson Katz and the chairs and ranking members of the Energy and Technology Committee for their leadership and advocacy of this important issue.”

Governor Malloy signed Public Act No. 14-75 into law in June, implementing several of the provisions contained in the Bill of Rights that create greater disclosure in the electric supplier market and enable consumers to control their electric bills, including:

• Disclosure of comparative rates on customers’ bills to provide customers with information to make informed choices
• Law requires electric bills to show the rate charged by the supplier, rate of standard service, term of standard service, dollar amount billed by supplier and the dollar amount that would have been billed under standard service.
• Disclosure of high and low rates charged/offered to allow customers and PURA the ability to compare rates being charged by the same supplier to different customers in the same period
• Law requires suppliers to disclose to PURA and list on their Web sites (and PURA’s) the highest and lowest rate charged to customers.
• Initial three months fixed rate to eliminate short-lived teaser rates
• Law requires rates to be fixed for at least three months if a supplier markets a variable rate plan with an introductory “teaser” rate.
• Quick switching to prevent customers from being stuck for multiple billing periods with a competitive supplier charging excessive rates
• Law requires utilities to switch customers, at customers’ request, back to standard service within 48 hours and to another supplier within 30 days; after a year, the law requires utilities to switch customers to other suppliers within 48 hours.
• Combat “customer capture” to allow customers greater freedom of choice
• Law requires suppliers to reduce or eliminate early termination fees.
• Affirmative consent for variable-rate contracts to prevent companies from taking advantage of customers lack of information
• Law requires suppliers to receive affirmative written consent from a customer before switching that customer from a fixed to a variable-rate contract.

This year alone, the state Public Utilities Regulatory Authority (PURA) has received more than 1,300 consumer complaints about electric suppliers and aggregators, according to its complaint scorecard. The law also empowers regulators to crack down on bad actors and deceptive practices in the industry. This includes:

• New regulations to rein in unfair, deceptive and abusive sales practices
• Law requires PURA to issue new regulations within a year to target abusive sales practices.
• Greater enforcement to increase market oversight and allow PURA to respond more effectively to abuses in market
• Law authorizes funds to be made available to PURA to increase enforcement staff.

“Too many electric customers have signed up for electric service on the promise of low rates, only to be shocked after opening their bills,” said Senate President Donald E. Williams (D-29). “This new law will inform, empower and protect consumers and provide them with all of the information they need.”

“Sadly, many residents have been misled by aggressive marketers for electricity suppliers who tout low initial prices, only to then be victimized by future price spikes buried in fine print,” said Speaker of the House Brendan Sharkey (D-88). “Everyone should have confidence and fully understand their choices, and this new law will help protect consumers by ensuring that offers by alternative electric suppliers are clear, concise, and consumer friendly.”

“We can best help electric consumers to keep their costs down by making the terms of their service as transparent as possible,” said Senate Majority Leader Martin M. Looney (D-11). “This legislation pulls the most important consumer information out of the fine print and puts it up front in plain view.”

“Information is power, and Connecticut’s electric customers deserve to know exactly what they are signing up for when shopping for supplier service. This ‘Bill of Rights’ for consumers will make our electric marketplace both more transparent and more competitive,” said State Senator Bob Duff (D-25), Senate Chairman of the Energy & Technology Committee.

“We crafted this law to rid the electric retail industry of the few bad actors, but also to encourage the good companies to deliver real savings and service to Connecticut consumers,” said State Rep. Lonnie Reed (D-102), House Chairman of the Energy & Technology Committee. “We are giving consumers the tools they need to make informed choices. We are also enabling consumers to quickly fire retailers they don’t trust and make a change. In a companion move, we are giving our state regulators the money they need to do an aggressive job of enforcement. We worked hard to make this the nation’s toughest, fairest consumer protection law for electric retail and I’m convinced we succeeded.”

“These protections will help consumers and promote honest business practices across our state,” said State Senator Clark Chapin (R-30). “No one should have to worry about deceptive marketing tactics concerning essential needs like electricity. Everyone deserves fair pricing, equal service and peace of mind when choosing an electricity supplier. The bill of rights is an important first step in eliminating market abuse. I thank everyone who worked together to advance this legislation.”

“Last winter I spoke to numerous constituents who suffered spiking electricity rates that caught them off-guard at prices two or three times what they had been paying previously,” said State Rep. Laura Hoydick (R-120), Ranking Member of the Legislature’s Energy and Technology Committee. “These consumers discovered that they were caught up in products and concepts that were intentionally misleading and confusing, such as hidden short-term rates rolling into very high rates. Predatory practices had turned what was supposed to be cost-savings into a fleecing. This Electric Supplier Consumer ‘Bill of Rights’ represents a comprehensive collaborative effort on behalf of the legislature and the governor to curb the unfortunate abuses consumers suffered last year.”

“The legislation enacted this year in response to the overwhelming number of consumer complaints received about third-party electric suppliers creates meaningful new consumer protections in the electric supplier market,” said Attorney General George Jepsen. “These reforms promise much greater transparency and flexibility for customers of independent electric suppliers. While consumers will see many of these important reforms immediately, our work is not yet complete. My office will continue to advocate for electric consumers as PURA begins its to work develop new regulations to address abusive solicitations and switching practices, hiring and training of sales staff, door-to-door sales and telemarketing practices – all areas where we have received consumer complaints.”

“Consumers will now be empowered with information to take back some control over their energy costs,” said state Consumer Counsel Elin Swanson Katz. “Consumers will be able to check their bills, compare their rate to the CL&P or UI standard offer, and make sure they are not paying more than necessary for the upcoming month. Too many consumers have been surprised by outrageously high variable rates that they only found out they were being charged after the fact. This law goes a long way toward ensuring consumers have no more surprises in their electric bills.”

Earlier this year, the state’s electric utility companies reported that some suppliers were charging rates well above – in some cases, more than double – the standard service rate of just over nine cents per kilowatt hour.