Texas Retail Provider To Pay $140,000 Under Settlement With PUC Staff

July 6, 2023

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Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Update (7/6):

Pulse Power provided the following statement concerning the matter:

"We can confirm that Pulse Power, LLC (Pulse Power) has entered into a settlement agreement with the Public Utility Commission of Texas (PUCT). Pulse Power takes its responsibility towards its customers very seriously and is always working to improve our processes and the experience customers have with us. We appreciate the open and ongoing communication with the PUCT, and we have taken proactive steps to address those items identified in the settlement."

--- Statement from Pulse Power

Earlier:

Pulse Power, LLC would pay $140,000 under a settlement with Staff of the Public Utility Commission of Texas to resolve alleged violations of 16 TAC §§ 25.475(c) and (d), related to its billing practices for fixed rate plans, and 25.485, related to telephonic access to customer service representatives

Under 16 TAC § 25.475(b)(5), a fixed rate product is defined as a retail electric product with a term of at least three months for which the price (including all recurring charges and ancillary service charges) for each billing period of the contract term is the same throughout the contract term, except that the price may vary from the disclosed amount solely to reflect actual changes in transmission and distribution utility (TDU) charges, changes to the Electric Reliability Council of Texas or Texas Regional Entity, Inc. administrative fees charged to loads, or changes resulting from federal, state or local laws that impose new or modified fees or costs on a retail electric provider (REP) that are beyond the REP’s control.

According to 16 TAC § 25.475(c)(1)(A), all written communications must be clear and not misleading, fraudulent, unfair, deceptive, or anti-competitive

As stated in the settlement, "Since June 2019, Pulse Power has offered six fixed rate products to its customers that include in the base charge usage up to a certain number of kilowatt-hours (kWh) during a billing cycle."

The settlement states, "An Agreement Summary appended to the terms of service for each of the fixed rate products stated, 'In the event that your first or last billing cycle as determined by the TDU is less than 30 days, only your first 67/kWh [sic] per day will be at $0.00/kWh and your base charge will be the amount stated on the Agreement Summary multiplied by the number of days in the billing cycle divided by thirty.'"

The settlement states, "Pulse Power violated 16 TAC § 25.475(c)(1)(A) by providing unclear information to its customers because its Electricity Facts Labels (EFLs) did not state what the kWh charge would be above the 67-kWh threshold for the day."

According to 16 TAC § 25.475(d)(2)(A), a REP may only change the price of a fixed rate product consistent with the definitions in subsection (b) of that section and according to the product’s EFL.

The settlement states, "The Agreement Summary allowed Pulse Power to change the way Pulse Power calculated electricity included in the base charge of the fixed rate products for billing cycles less than 30 days."

The settlement states, "The Agreement Summary also allowed Pulse Power to apply a dollar per kWh rate that was not included in the product’s EFL."

The settlement states, "Pulse Power asserts that the intent of the Agreement Summary provision was to provide its customers with a prorated base charge during the final month of a customer’s contract, resulting in a lower base charge for the vast majority of customers."

The settlement states, "Between June 2019 and October 2022, 12,684 customers on one of these fixed rate products experienced a billing cycle of less than 30 days."

The settlement states, "For each of the 12,684 customers that experienced a billing cycle of less than 30 days, Pulse Power prorated the base charge during the first or final month of each customer’s billing cycle, resulting in a change to the amount of electricity included in the base charge."

The settlement states, "Of the 12,684 customers that received a prorated invoice, 10,298 customers experienced a lower bill because of the prorated pricing structure."

The settlement states, "Of the 12,684 that received a prorated invoice, 2,386 customers experienced a higher bill than if the prorated pricing structure had not been applied by Pulse Power."

The settlement states, "Staff asserts that Pulse Power violated 16 TAC § 25.475(d)(2)(A) 12,684 times because its policy of prorating a customer’s base charge for a billing cycle of less than 30 days inadvertently resulted in a price that did not reflect actual changes in TDU charges, administrative fees, or federal, state, or local laws, and because the applied rate was not included in the EFL."

The settlement states, "From June 1, 2022, through August 31, 2022, Pulse Power experienced a large increase in service calls, receiving more than twice the volume of service calls than the same time period the prior year."

The settlement states, "Staff asserts that Pulse Power violated 16 TAC § 25.485(b)(2) by having average hold times of over an hour during business hours for its toll-free number from June 1, 2022, through August 31, 2022."

The settlement states that Pulse Power asserts it has implemented the following measures to prevent future violations of 16 TAC § 25.485(b)(2) from occurring, and will continue to implement such measures going forward:

a. "Pulse Power immediately focused on staffing gaps over the period in question."

b. "Pulse Power hired a Workforce Manager and invested in specific software to better model and forecast staffing needs."

c. "Pulse Power incorporated extreme case scenario forecasts into its standard forecasting process for Workforce Management."

d. "Pulse Power revised its Agreement Summary to remove the language noted above and revised its EFLs in January 2021 to incorporate its policy of prorating a customer’s base charge for a billing cycle of less than 30 days."

Docket No. 55126

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