Connecticut Proposes Regulation of Electricity Suppliers

As a response to hundreds of complaints about rising electric rates and allegations of deceptive practices, Connecticut officials have unveiled a legislation that will require greater disclosure from electricity suppliers as well as fixed rates for at least three months.

Gov. Dannel P. Malloy, Attorney General George Jepsen, Consumer Counsel Elin Swanson Katz and Senate President Pro Tem Donald Williams spoke to several dozen senior citizens at a Hartford senior citizen wellness center to detail a proposed “bill of rights” for consumers.

Evidence of a “serious dysfunction” in energy markets is a business model among some electricity suppliers that relies on consumer ignorance, preventing them from changing their supplier, Jepsen said.

The legislation would require electric bills to show the rate charged, term of service and other details. Electricity suppliers would also be required to disclose the highest and lowest rates.

The measure also would require electricity suppliers to fix introductory “teaser” rates for at least three months. A major complaint by consumers has been sudden and unexpected increases in rates when introductory rates expire.

Suppliers also would be required to comply quickly with customer requests to be switched back to either of Connecticut’s two regulated utilities or another electric supplier. The legislature’s annual session ends on May 7.

Discount Power in Shelton, which was among several companies cited by Jepsen and Katz, told callers in January that price increases were due to extremely high demand for energy during the winter’s fierce cold spells.

In comments to the Public Utilities Regulatory Authority, Gulf Oil Limited Partnership said last month that a requirement for written consent from customers before switching from a fixed to a variable rate contract would increase the cost of keeping customers. Customers on fixed price contracts should instead be notified of the terms of the renewal and how to make sure the contract is not renewed.

The state Public Utilities Regulatory Authority has received more than 1,300 complaints this year from consumers about electric suppliers and other companies. A draft decision by regulators on proposed rules is expected on June 4.

Dozens of electricity suppliers have entered the market since Connecticut deregulated utilities in 1998, with consumers complaining that sharply higher prices followed.

“One reason we did deregulation of the market in 1998 was for consumers to have choices,” Katz said. “But these weren’t the kind of choices we had in mind.”

Jepsen and Katz said in January that thousands of customers were being charged 17 cents per kilowatt hour and some nearly 25 cents per kilowatt hour. That’s more than double what’s paid by customers of Connecticut Light & Power and United Illuminating Co.

Inilda Pena, a Hartford resident who was visiting the wellness center as officials spoke, said she hopes the legislation is enacted and makes a difference.

“People like us live on Social Security,” she said. “We don’t have a lot of money. We don’t just pay bills.”