OPC urges immediate action to protect customers of marketing scheme
BALTIMORE – The Public Service Commission should take immediate action to protect some 31,000 current and former customers of a retail electricity supplier that the Commission in 2021 found engaged in false and misleading marketing to enroll customers, the Office of People’s Counsel said in a filing today.
A bond that the retail supplier, SmartEnergy Holdings, LLC, posted while appealing the Commission’s findings is wholly inadequate to ensure that customers—who likely paid hundreds of dollars in excessive rates—receive compensation for the harm, OPC’s filing said. The OPC filing reiterated the request OPC made 21 months ago, asking the Commission to require a bond that is adequate to protect harmed customers, but the Commission never ruled on OPC’s request.
“These customers have waited almost two years for relief since the Commission found SmartEnergy’s conduct unlawful,” said People’s Counsel David S. Lapp. “Because the bond the supplier posted is inadequate, customers are at risk of losing any compensation.”
In 2021, the Commission found that SmartEnergy violated numerous provisions of Maryland law and Commission regulations by deceptively enrolling customers by telephone. The Commission ordered SmartEnergy to provide customer refunds for the extra charges, but after the retail supplier appealed in 2021, the Commission agreed to suspend its refund requirement during the appeal. In court papers filed in April 2021, SmartEnergy disclosed that the amount of customer refunds then totaled about $6 million. That figure presumably has risen, given that some of those customers likely continue to be charged as SmartEnergy customers.
OPC and the Commission defended the decision on appeal, winning both in circuit court and in the Appellate Court of Maryland. The company has since asked the Maryland Supreme Court to hear the case. If the Supreme Court decides against hearing the appeal, the bond terms provide that the bond may terminate—long before the exact refund amounts are determined, the refunds are paid to the victimized customers, and the Commission verifies the refunds were actually paid. OPC’s request asks the Commission to issue a new order requiring modifications to the bond sufficient to ensure compensation to the past and present customers SmartEnergy unlawfully enrolled.
“After almost two years, these customers still have not even been informed of SmartEnergy’s illegal activity,” Lapp said. “Some of them may continue to be SmartEnergy customers being charged high rates, as SmartEnergy continues to profit from its unlawful customer enrollments. Immediate action is needed to ensure they are protected and compensated.”
The Maryland Office of People’s Counsel is an independent state agency that represents Maryland’s residential consumers of electric, natural gas, telecommunications, private water and certain transportation matters before the Public Service Commission, federal regulatory agencies and the courts.
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