Consumer watchdog group The Citizens Utility Board (CUB) said Monday it is filing a complaint with the Illinois Commerce Commission (ICC) against retail gas marketer U.S. Energy Savings Corp. for deceptive sales tactics, including posing as gas utility representatives.

CUB said it issued a consumer alert, warning utility customers to beware that U.S. Energy sales people are going door-to-door posing as representatives of Nicor Gas, Peoples Gas, the ICC or even CUB, or claiming that services are endorsed by those organizations. CUB said U.S. Energy appears to be targeting areas of Chicago and the suburbs where English is not the native language of many residents and has been urging customers to sign five-year contracts. A U.S. Energy company representative could not be reached for comment.

CUB said it received hundreds of inquiries and complaints about the retail marketer. In its filing with the ICC, the watchdog asks the commission to ban the company’s misleading tactics and levy fines for each instance of consumer fraud.

“This company is engaged in the worst kind of consumer fraud, preying on people’s fears of rising natural gas bills and resorting to deception in order to boost sales,” CUB Executive Director David Kolata said. “Today we are telling consumers if U.S. Energy — or any other company for that matter — comes to your home peddling natural gas service, shut the door on them.”

CUB said several customers reported the company came to their door with a “petition” to freeze natural gas rates. A few weeks later, they received welcome letters stating their natural gas service had been switched to U. S. Energy. The Chicago Department of Consumer Services also has received complaints about the company.

“Many people are trying to lower their gas bills, but before signing a contract, consumers should compare prices from multiple suppliers,” said Commissioner Norma Reyes, of the city’s Department of Consumers Services. “Only by comparing prices and thoroughly understanding the terms can consumers make an educated decision.”

U.S. Energy is one of eight alternative gas suppliers participating in the “customer choice” programs offered to Nicor Gas, Peoples Gas and North Shore Gas. Alternative suppliers generally offer either a fixed rate, locked in for a period of one to five years, or a variable rate tied to an index that changes monthly.

As of April 19, the company was offering to lock in natural gas prices for four to five years at a price of $1.19 per therm, plus a balancing charge of 2.31 cents per therm, for a total price of $1.21 per therm. Marketing materials from the company warn that natural gas prices are rising and lead customers to believe they can save money by locking in prices.

According to CUB’s Gas Market Monitor, the majority of consumers who switch to alternative suppliers end up paying more (see Daily GPI, March 30). Sixty percent of the active retail gas sales plans offered by unregulated retail marketers in Illinois are bad deals that would have cost customers more money than sticking with their state utility supplier, according to the CUB analysis.

“Gas prices over the past few years have placed a heavy financial burden on Chicago residents. The City has and will continue to educate people on the importance of making homes more energy efficient through various heating fairs and supplying weatherization materials at those fairs,” said Sadhu Johnston, commissioner of the Chicago Department of Environment.

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