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PUC Opens Investigation Of Retail Supplier After Allegations Supplier Charged Rate In Excess Of 20¢/kWh While Using Terms "The Best", "Competitive" Rate

April 17, 2019

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Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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The Public Utilities Commission of Ohio opened an investigation of PALMco Power OH, LLC d/b/a Indra Energy (PALMco) after Staff of the Public Utilities Commission of Ohio alleged that PALMco has engaged in misleading and deceptive practices.

PALMco provided the following statement to EnergyChoiceMatters.com: "We have just become aware of PUCO’s actions today and are still waiting to see more specific information. We are committed to a robust compliance program and take consumer protection with the utmost seriousness. We will continue to work with regulators and Staff to address any concerns in a responsive way, and will continue to focus on providing our customers with the highest-quality customer service."

PUCO directed PALMco to show cause why its certification should not be suspended, rescinded, or conditionally rescinded

Staff alleged that, "Between December 1, 2018 and April 15, 2019, Staff of the Commission's Service Monitoring and Enforcement Department (Staff) received 486 customer contacts regarding PALMco's provision of CRES [competitive retail electric service] and CRNGS [competitive retail natural gas service]. Of these 486 customer contacts, 373 customer contacts (approximately 76 percent) are related to complaints of high billing, billing inquires, misleading and deceptive practices, enrollment disputes and contract inquiries. Through these customer contacts. Staff discovered PALMco's unfair, misleading, deceptive and unconscionable marketing, solicitation, and sales acts and practices when PALMco committed to provide customers with 'competitive' and 'the best' rates, when in reality, PALMco charged customers quadruple the price to compare."

Staff alleged that, "For example, one complaint arose from a PALMco customer who stated that after his first two months of a 5.2 cents per kilowatt hour (cents/kWh) rate, he was charged between 19 and 24 cents/kWh. Staff reviewed the PALMco sales call and discovered the customer was advised 'it will just ensure you will get a competitive rate,' and 'the rate will be 5.2 cents/kWh for two months and then after that we shop the market every single month to make sure that you get the best possible rate.' The price to compare for AEP Ohio at that time was 5.4 cents/kWh. The median variable price on the Energy Choice Ohio website for February was in the 7 cents/kWh range, and the highest rate of any supplier other than PALMco was close to 11 cents/kWh for the month of February. PALMco's charge of 23.766043 cents/kWh for the customer's January bill resulted in a charge of $533.31. If the customer was receiving service on a median rate, his bill would have been approximately $157.00, and on his AEP Ohio price to compare rate, his bill would have been approximately $121.00."

Staff alleged that, "In another case, a customer was advised, that the '...program allows you to drop that rate down to a 5.2 cents/kWh rate for the first two months and then you're entitled to receive a competitive variable rate each and every month thereafter.' In that instance, the customer was charged a rate of 21.154164 cents/kWh on her third month's bill, which resulted in a charge of $563.97. Furthermore, Staff has received similar customer contacts on PALMco's provision of CRNGS."

Staff alleged that, "As of April 15, 2019, 22 percent of supplier-related investigations open for review and resolution with Staff are complaints against PALMco. Upon review of these investigations and following receipt of responses from PALMco, Staff believes that PALMco was using unfair, misleading, deceptive, and unconscionable acts and practices to market and enroll customers, in violation of Ohio Administrative Code (Ohio Adm.Code) 4901:1-21 and 4901:1-29, including Ohio Adm.Code 4901:1-21-03(A), 4901:1-21-05(C), 4901:1-29-03(A), 4901:1-29-05(D), and 4901:1-29-10(A).

Staff said that, "Due to the egregious nature of PALMco's acts and practices, Staff recommends that a case be opened with a case code of 'Commission Ordered Investigation' (COI) in order for Staff to continue a thorough review of PALMco's provision of competitive services in Ohio. During the pendency of Staff's investigation. Staff also recommends that the Commission consider one of the following actions: a suspension of PALMco's certificates; conditional rescission of its certificates; or rescission of its certificates, in accordance with Ohio Adm.Code 4901:1-21- 15(A)(2), 4901:1-24-13, 4901:1-27-13 and 4901:1-34-08(D)."

Case 19-0957-GE-COI

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