State mandates energy suppliers go lower or go out of business


BUFFALO, N.Y. (WIVB) – The deregulation of utilities in New York was supposed to lead to lower gas and electric bills–through energy service companies, or ESCO’s—but after nearly 20 years, that has been largely a broken promise for residential customers.

Starting next week, that is going to change, according to Gov. Andrew Cuomo, and the State Public Service Commission.

About the only thing Western New Yorkers know about ESCO’s is, their sales representatives go door-to-door trying to sign them up with false promises of lower gas and electric bills—leading to consumer complaints about rude, obnoxious sales people.

Consumers also complain ESCO representatives misled them, promoting lower gas or electric bills, but their charges went up, in some cases two and three times higher.

“There were some bad actors in this field who were going in promising people savings, and then coming out with higher rates,” said Bill Armbruster a public utilties watchdog for AARP.

While large and industrial power users have been saving with independent suppliers, Armbruster said residential and small business customers are getting the short end of the deregulation stick in New York.

“The average energy services company customer–and that includes both residential and small businesses–was paying 14% more than if they had stayed with their traditional gas and electric company.”

Under a plan announced by Gov. Cuomo, starting March 4, ESCO’s have to guarantee new customers’ bills will be the same, or less, than for the utilities, unless 30 percent of their supply comes from renewable energy.

Armbruster added, the comprehensive plan calls for the Public Service Commission to audit New York’s ESCO’s in the next 60 days.

“They are also strengthening the regulations in which to revoke someone’s ability to provide energy here. So if you are going to be one of those ‘bad actors’ in the industry, there’s going to be severe repercussions that could happen.”

To show how serious they are, last month, the state PSC revoked the certification of four ESCO’s, barring them from doing business in New York. With this new mandate, it seems New York’s ESCO’s are going to lower your bills, or go out of business.

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