The Senate voted unanimously Tuesday for legislation to require more transparency from third-party electricity suppliers and reduce deceptive marketing tactics in the industry.
Senators on both sides of the aisle reported hearing complaints from constituents about the suppliers, who attract new customers with offers of low energy rates that can expire quickly and leave consumers paying more than standard rates.
The bill will require suppliers to maintain their initial sign-on electric rates for at least three months. It also requires that electric bills include the standard rate, so consumers can compare it with the rate they’re paying. The legislation also gives customers greater flexibility to drop their electric supplier.
Energy Committee Co-Chairman Sen. Bob Duff said policymakers have “heard from consumers loud and clear” on their electric bills.
“They kind of looked at their bill one day . . . and it spiked without any notification or any type of transparency,” he said. “What we’re looking to do is bring about some greater transparency and disclosure.”
Sen. Michael McLachlan, R-Danbury, said lawmakers have been swamped with calls on the issue this year because of “wild fluctuations” in the variable rate market, which have led to unexpectedly high electric bills.
“When you’re talking about people that are on tight budgets to begin with and a $400 electric bill turned into $1,000 per month, it was a budget-buster,” he said. “That’s why our phones rang off the hook.”
Lawmakers announced they would take up the issue this year before the session started. However, advocates said the final product adopted Tuesday does not go far enough to protect consumers.
Last month, Connecticut AARP released a public opinion poll designed to push legislators toward enacting strong consumer protection policy rather than what AARP advocacy director John Erlingheuser called “some window dressings so people can say we’ve done something.”
The group pushed for a cap on variable electric rates when policymakers including Gov. Dannel P. Malloy, Attorney General George Jepsen, and Senate President Donald Williams announced a compromise proposal.
After the Senate approved the bill Tuesday, AARP released a statement from Erlingheuser saying the legislation added some transparency — but not enough.
Erlingheuser said the bill “does little to address the types of egregious practices of some third-party electric suppliers that got us into this crisis in the first place. AARP Connecticut and other consumer advocates, including ConnPIRG, CCAG and LARCC, are calling on legislators to amend Senate Bill 2 to include the strongest possible consumer protections.”
The groups, which include the Connecticut Citizens Action Group and the Legal Assistance Resource Center of Connecticut, called for an amendment to cap variable rates and ban all cancellation fees as well as enact additional disclosure requirements.
During the Senate debate, lawmakers acknowledged the legislation would not meet the requirements of all the advocates.
“Maybe not everything that every advocacy group wanted is in this bill, but this bill moves us forward in a giant way toward protecting consumers, empowering them to have the information they need, then make changes when there are spikes in the electric market,” Williams said.
The bill will still need to be approved by the House. In a statement, Malloy commended the Senate vote.
“This bill will help put an end to misleading and deceptive marketing practices. It will give our families the information they need to evaluate pricing options offered by electric retailers and to choose the plan that is best for them and their pocketbooks,” he said.