On June 2nd, the New York City Council’s Black, Latino and Asian Caucus (BLAC), key members of the New York State Legislature, AARP, and the Public Utility Law Project of NY (PULP) announced today that they strongly support the nearly unprecedented issuances of 176 subpoenas of energy service companies (ESCOs) to force transparency on an industry that has been overcharging consumers for years.
The subpoenas issued by the state Public Service Commission (PSC) are a response to the ESCO industry’s resistance to Governor Andrew Cuomo’s proposed consumer protection measures.
Over the past 15 months, ESCOs have fought in proceedings and lawsuits to keep secret numerous details about their business practices, which have harmed consumers, particularly in low-income and other vulnerable communities, and resulted in roughly $30 million in monthly overcharges of residential consumers.
“As the author of the ESCO Bill of Rights in 2009, I have worked against the ESCOs’ anti-consumer behavior for many years,” stated Sen. Kevin Parker, ranking member of the NYS Senate Energy Committee. “ESCOs are well known for overcharging and targeting low- income households in New York City and across the twenty states that have deregulated retail electric service,” continued the Senator. “It is not surprising, therefore, that ESCOs have spent the past year filing lawsuits designed to stop the PSC from exposing their behavior. I join my fellow state legislators, the Council Members, PULP, and AARP in commending the Governor and PSC for standing up for consumers.”
“As a former tenant lawyer and native of Brownsville, I’m well familiar with the harm these predatory companies have wreaked in my community,” said Assem. Latrice Walker (D- North Brooklyn), Chair of the NYS Assembly Committee on Renewable Energy. “I am strongly encouraged that the PSC and the Governor have taken such determined actions to end the overcharging, the harassment, and the explicit victimization of low-income people of color, seniors, English-language learners—the most vulnerable in our society.” Assem. Walker added: “It’s long past time that their excuses and subterfuges be pushed aside and the truth shown.”
“I am grateful for the Governor and PSC’s leadership, and for the partnership of my elected colleagues and consumer advocates, in fighting for better protection for the City’s residents,” said Councilmember Ritchie Torres, Chair of the Committee on Public Housing and Co-Chair of the Black, Latino and Asian Caucus and member of the Council’s Progressive Caucus. “The BLA Caucus and this coalition will continue to monitor this important regulatory proceeding, and we will be taking strong steps in the near future to protect our constituents. Stay tuned.”
“It is a disgrace that ESCOs not only failed to keep their promises to provide cheaper energy prices, but have continually deceived and overcharged our communities,” said Councilmember Donovan Richards, Co-Chair of the Progressive Caucus and member of the Black, Latino, and Asian Caucus. “That is why I am supporting the Governor and PSC in working to make the ESCOs accountable through the critical PSC public investigation. I’d like to thank the Governor and the PSC for their commitment to pulling away the veil over ESCO activities, particularly in New York’s most vulnerable communities.”
“Energy service companies (ESCOs) should be held to the highest standards of transparency and accountability. Utility customers have the right to know how their energy is priced and if they’re saving money or being overcharged,” said Councilmember Carlos Menchaca, member of the Council’s Progressive and Black, Latino, and Asian caucuses. “I thank advocates like the Public Utility Law Project for their work protecting consumers. I also urge Governor Cuomo and state and federal energy regulators to force ESCOs to provide complete information about their pricing and billing practices.”
“If energy service companies have misled, overcharged or otherwise harmed the public, we need to know about it and hold them accountable,” said Councilmember Debi Rose, member of the Black, Latino, and Asian and Progressive caucuses. “Increase after increase has put a strain on the well-being of my constituents. No one should have to choose between heating their homes or feeding their families, but for too many, that is a reality. I applaud these subpoenas as a long overdue first step toward forcing transparency and accountability on an industry with a history of questionable business practices.”
“ESCO consumers need to know why they’re paying so much more for their energy than if they had stuck with their utility company. If ESCOs won’t explain, regulators need to force the issue,” said AARP New York State Director Beth Finkel. “AARP thanks Senator Parker, Assemblymember Walker, and the City Council’s Black, Latino and Asian Caucus for speaking out on behalf of consumers, and we applaud Governor Cuomo and the PSC for their persistence in protecting New York’s overburdened utility consumers.”
“ESCOs overcharged New York residential customers a staggering $816 million during a 30-month period ending June 30, 2016, according to the PSC,” said Richard Berkley, Executive Director of the Public Utility Law Project of New York, a consumer advocacy organization. “These overcharges were caused by ESCOs charging 22 percent more for their electricity, on average, than traditional utility companies charged in 2015, according to U.S. Energy Information Administration data. PULP is proud to partner with New York City’s elected representatives and AARP on this vital consumer issue, and we will continue to fight for New York’s residents.”
The first business day after the PSC issued the subpoenas, the ESCOs filed appeals of the PSC’s action – threatening months of delay to the regulators’ plans for hearings aimed at greater protections for New York’s overburdened utility consumers. Each month of delay results in millions of dollars of customer overcharges, which depress economic growth in low-income neighborhoods, drain money from small commercial enterprises, and drive residential consumers into arrears and potentially damaged credit.