Promise of Lower Energy Bills, Often Leave Consumers Seeing the Opposite, Advocates Seek Stronger Consumer Tools & Transparency
ALBANY, N.Y., Jan. 25, 2013 /PRNewswire-USNewswire/ -- As temperatures drop across New York State, competition for consumers' utility dollars is soaring – often times coming with the "promises" of lower rates. However, in comments filed by AARP and the Public Utility Law Project (PULP) with the New York State Public Service Commission (PSC), the groups claim current market rules have failed to protect consumers from falling prey to bad deals on energy.
"The New York State Public Service Commission is taking a hard look at the tactics and value of unregulated energy providers in the state. AARP commends them for this step to more closely monitor the industry," said Bill Ferris, Legislative Representative for AARP in New York. "As energy costs for New York consumers soar, saving money by switching energy provider become very attractive – we just want to make sure consumers have all the facts before signing the dotted line."
According to AARP and PULP, there is growing evidence that many customers who switch from a traditional energy provider to an ESCO end up paying much higher bills. Data from National Grid's recent rate case shows that among customers who made the switch to an ESCO 84% of electric bills and 92% of gas bills were higher than for customers who stayed with National Grid. Over the 24-month period studied, those with higher bills paid nearly $500 more for electricity and $260 for natural gas, on average.The PSC is currently reviewing the industry's practices and looking to consumers for input. AARP is encouraging New York residents to make their voices heard by taking a PSC survey on the issue: https://www.surveymonkey.com/s/DDT3NH9 "Allowing customers to select alternative energy providers, like ESCOS, should not come at the risk of exposing customers to even higher energy bills," added Ferris. "AARP is calling for better transparency of the industry and better tools to encourage informed customer choice – we want to ensure New York consumers don't fall prey to tactics that leave them on the hook with higher bills than before." Today, AARP and PULP recommended the PSC:
- Help consumers more effectively comparison shop between ESCOs and utility companies by developing bill calculators and more widespread access to energy pricing information on utility company websites.
- Requiring utilities to include a line item on ESCO customer bills that identifies what the customer would have paid had supply been purchased from their old utility.
- Stronger oversight of door-to-door marketing activities.
- Regulation of termination fees.