NY regulators establish regulations to protect electricity customers

The NY Public Service Commission recently ruled that non-utility energy marketers must guarantee cost savings or provide electricity from renewable sources if they sell energy to residential or small commercial customers.

The commission said its new rules for energy service companies, or ESCOs, stem from a broad investigation that discovered what many consumers have complained about for years: Significant over-charging is rampant among some of the marketers.

“We have heard from too many consumers that they were unfairly lulled by aggressive and dishonest ESCO marketing into believing they were getting savings that they did not receive.”

In a recent review of the industry, the PSC determined that some customers are being grossly overcharged.

With this PSC decision, energy service companies that market to residential customers must provide written guarantees that they will charge less than the utility. The exception is for green energy. Energy marketers can charge higher prices for electricity that is at least 30 percent derived from renewable sources. The PSC will review whether exceptions should be made for other residential services sold by energy service companies, such as energy efficiency.

The commission said it will strengthen its process for revoking the eligibility of energy service companies to do business in New York if they are found in violation of state regulations. The PSC is also reviewing other options, such as imposing stiff financial penalties on companies that violate the rules.