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Md. PSC Grants Electric License to Energy Service Providers, Inc., Orders Legal Name
on All Contracts
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January 6, 2011
The Maryland PSC granted Energy Service Providers, Inc. d/b/a Maryland Gas and Electric an electric supplier license on the condition that its contracts identify the supplier as Energy Service Providers, Inc. d/b/a Maryland Gas and Electric, rather than just listing the trade name, which is shared by its legally distinct affiliate U.S. Gas & Electric, Inc.
Though a letter order was not yet issued with specific directives, and though affiliate U.S. Gas & Electric, Inc. d/b/a Maryland Gas & Electric has already received a gas supplier license, the Commission indicated that U.S. Gas & Electric, Inc. would also be required to indicate on its gas contracts that the supplier is "U.S. Gas & Electric, Inc. d/b/a Maryland Gas & Electric."
The electric license authorizes Energy Service Providers, Inc. to serve all customer
classes, including residential customers, at the four investor-
Contrary to comments from the Office of People's Counsel (1/5), Energy Service Providers, Inc. clarified at yesterday's administrative meeting that it had not voluntarily offered to add its corporate name to its contracts, though the Commission ultimately adopted such a condition as part of the license. Energy Service Providers, Inc. said there had been a misunderstanding with OPC on this issue.
OPC was concerned that the pro forma contracts submitted by the company only included the trade name Maryland Gas and Electric, and did not indicate the legal entity which was the obligor under the contract. OPC suggested that absent such identification of the obligor, a meeting of the minds under the contract may not take place.
Energy Service Providers, Inc. said that it has seen Maryland contracts from other suppliers which only list the supplier's trade name and not its legal, corporate name, and noted that the Commission has not taken any action against such suppliers. Energy Service Providers, Inc. would not disclose which supplier contracts only list a trade name, stating that it reviewed the contracts as part of customer focus groups, and that customers were provided confidentiality as part of the process.
In any event, the fact that two legally distinct obligors share a common trade name compounded OPC's general concerns with respect to identification of the legal obligor on contracts.
Although Chairman Douglas Nazarian acknowledged that the use of the trade name by the two affiliated companies is legal, Nazarian called the Maryland Gas & Electric trade name "intrinsically misleading" and thinks it is a "huge potential problem." Speaking only for himself, Nazarian said that he would seek a large fine at the first instance of a customer complaining to the PSC that they received a call from Maryland Gas & Electric but the customer believed they were being contacted by Baltimore Gas & Electric. Nazarian informed Energy Service Providers, Inc. that its decision to use the Maryland Gas & Electric trade name is an "enormous gamble," in Nazarian's view.
Nazarian compared the Maryland Gas & Electric trade name to the Commission's directive to Public Power & Utility to drop the term "utility" from its name when conducting business in Maryland (7/1), though Nazarian said the name Maryland Gas & Electric was "not quite as bad," and ultimately the Commission did not require any modification of the Maryland Gas & Electric trade name.
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