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NY Public Service Commission launches investigation into shady ESCOs

The New York State Public Service Commission may bar energy service company MPower Energy following more than 100 complaints about deceptive sales and marketing practices by the Brooklyn-based firm.

Following an investigation, the Commission said MPower must offer proof on why it should be allowed to continue operating in New York serving low-income customers, who are frequently the victims of misleading sales practices by ESCOs.

Allegations against MPower Energy include claims they enrolled some customers without their permission, an illegal practice known as “slamming.” One customer alleged that a salesman “rang my bell and banged on my door multiple times (before) they yelled, ‘Building Verification!’” When the resident asked for identification, the sales agent yelled “Building Verification!” again and threatened to assault the resident when she voiced her displeasure.

To protect low-income ratepayers from paying too much for electricity and natural gas, the Commission banned most ESCOs from serving low-income customers in an order approved last December. The Commission said it would consider waivers for any ESCO that promises to offer bill savings or guarantee benefits to low-income customers.

Three companies – Just Energy NY Corp., National Fuel Resources and Zone One Energy – were allowed to continue operating while waiver requests were denied for five others.

A 30-month, statewide audit of ESCO charges found that low-income New Yorkers paid $96 million more than what a utility would have charged for gas or electricity. The Commission is now pursuing a broader, in-depth investigation into ESCO practices to determine what, if any, new regulations or actions are necessary to protect all consumers.

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