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Homeowners Group, D.C. Utility Spar Over Switching Charges

Homeowners Group, D.C. Utility Spar Over Switching Charges

Switching games? Or mind games? This past week, a Washington, D.C.-based nonprofit group, United Homeowners Association, called a press conference to charge that nationwide, utilities are playing "switching games" with consumers who attempt to move to a lower-cost competitor, or who attempt to use online energy companies.

The watchdog group based its analysis on natural gas deregulation in two major U.S. markets - Washington, D.C. and Atlanta, GA. Using that information, the UHA charged that the cost savings available under energy deregulation, at least in the D.C. area, actually may be denied to consumers, or take so long that the consumers finally give up.

Using only one "bad" utility --- Washington Gas Light --- and one "good" utility --- Atlanta Gas & Light --- UHA said it found evidence that WGL customers who want to switch to alternative energy companies, including online companies especially, would be stymied in their efforts. One disgruntled former WGL customer was brought to the podium to speak of his profoundly unhappy experience with WGL, which he said had ignored his requests to change services. WGL currently runs a pilot program for its customers because deregulation is not fully implemented in the D.C. area.

UHA also disclosed that it had found that at Atlanta's AGL, less than one in 10 customers experienced switching delays for customers who requested another service. AGL is fully deregulated.

"Natural gas is the same product everywhere it is sold in the U.S., and yet consumers face wildly different approaches to deregulation," UHA President Jordan Clark charged. "Washington, D.C. is a textbook example of how to make a complete mockery of energy deregulation." Clark said that UHA was aware of "many dozens of consumers" who had been frustrated by efforts to switch service in the D.C. area, while in Atlanta, "consumers almost never have problems switching, and, as a result, actually get a chance to save under energy deregulation."

UHA apparently is unfamiliar with the multiple slamming cases in Georgia, three of which resulted in settlements with the Georgia Public Service Commission. The last slamming settlement took place only two weeks ago, resulting in retail marketer Energy America having to pay $100,000, including $75,000 to an energy assistance fund for elderly and low income customers and $25,000 to the state treasury.

Clark noted that gas deregulation is under way in 32 states, seven are the first phase of the process, and 12 states have deregulation pilot programs. Another 10 states are "actively" considering deregulation.

"The message here is something needs to be understood by lawmakers and homeowners across the nation," Clark said. "So-called 'pilot programs' that leave ex-monopoly utilities in charge of the day-to-day side of implementing deregulation are a train wreck waiting to happen. You can't leave the fox guarding the chicken coop and expect anything but the predictable result."

Ironically, UHA's press and media relations are handled by The Hastings Group, a Virginia-based company that also works for PowerTrust.com, an energy marketer that offers natural gas, propane and heating oil through its D.C.-based online company. Soon, it also is expected to offer electricity to customers in the same area that WGL now serves.

A conflict of interests? Not according to Hastings Group Senior Partner Scott Stapf, who told NGI that he did not see "how those relationships will pose conflicts of interest...and I don't see us disclosing every other organization with whom we work every time we send out a press release." However, The Hastings Group is actually listed on PowerTrust.com's web site as the place to go for more information about the company.

WGL officials felt a little differently about The Hastings Group's involvement with UHA. WGL corporate spokesman Tim Sargeant said the company's pilot program is now serving about 165,000 customers in D.C., Maryland and Virginia with few problems.

"This program comes under a lot of scrutiny by the commissions, and we want input and they want input," Sargeant said. "We've never heard from this group (UHA), and we weren't even invited to offer our comments." Sargeant said WGL did not even know about the UHA press conference until reporters began calling when it was over.

Sargeant said WGL's program is "going well," with few complaints from customers. The "Customer Choice" program has about 30 active energy suppliers now. PowerTrust.com currently is not one of them. To prevent "slamming," the practice of unauthorized switching by suppliers, WGL requires an accurate customer account number be included on the authorized release submitted by the customer before enrolling in another program, or once in the program, to change to another supplier.

WGL said through a written statement Friday that it is an "avid proponent of full-scale natural gas energy competition so that all consumers may take advantage of the potential economic opportunities and choices that a competitive market provides."

No changes are planned in the natural gas program because, said Sargeant, no changes have been requested by the overseeing regulatory agencies.

"Washington Gas takes issue with allegations made against it recently by UHA, a group claiming to address critical homeowners' issues," said the WGL statement. "Washington Gas has been involved for years working side-by-side with regulators, consumer advocates and other interested parties, in the collaborative process of addressing such issues as consumer protection and greater market access in the deregulation process."

Overall, WGL serves about 850,000 residential, commercial and industrial customers throughout metro D.C. and the surrounding region.

Carolyn Davis, Houston

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