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DPUC Issues Notice of Violation to Starion, Intends to Assess $70,000 Fine

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November 8, 2010

The Connecticut DPUC issued a Notice of Violation and Assessment of Civil Penalty against Starion Energy for what the Department said were violations of Connecticut General Statutes §§ 16-245o(e), 16-245o(h), and 16-245(g)(2), relating to, among other things, authorization for customer switches and notice of the rescission period. Starion Energy has the right to a hearing to contest the findings contained in the notice prior to entry of a final order (09-10-10RE01).

The Department is seeking a total civil penalty of $70,160 for the violations. The Department noted that there has been a substantial decline in the number of Starion complaints filed after its investigation was initiated, but said that the, "violations documented in this proceeding are serious and compel close monitoring of Starion's performance going forward."

The Notice lists two specific incidents, cited in customer complaints, in which the DPUC said that Starion admitted to the Department that it did not have the proper consent needed to switch those customers. For each of these failures to comply with Conn. Gen. Stat. § 16-245o(e), which requires confirmation of each customer's desire to be switched, Starion would be fined $1,000 (for a total of $2,000).

In addition, the DPUC found that for 21 enrollments conducted by telephone, Starion did not use a verification process which conformed to the independence requirements set forth in Conn. Gen. Stat. § 16-245o(e). The DPUC would fine Starion $1,000 for each of these enrollments ($21,000 in aggregate).

The DPUC also said that the evidence shows that 4,716 small volume customers that Starion enrolled via paper enrollment form were not notified of the right of rescission per Conn. Gen. Stat. § 16-245o(e) in either the enrollment form or in Starion's then-applicable disclosure label, nor in an enrollment welcome letter. Starion has not provided any evidence showing that it provided these customers notice of their right to cancel an enrollment, the DPUC said.

Starion would be fined $10 for each instance when it failed to inform the customer of the rescission period, or $47,160 total.

The DPUC also cited two complaints from customers who did not enroll with Starion in which the DPUC said that Starion agents provided, "misleading statements regarding the status of a competing electric supplier, PP&U, as a pretext to gain the customers' service." Specifically, a potential customer alleged that the agent said that Public Power & Utility had changed its name to Starion, and another potential customer alleged that the agent described Starion as the "mother company of PP&U"

Per Conn. Gen. Stat. § 16-245u(b)(5), the Department is referring these two complaints to the Attorney General.

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