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Date: 5/1/2015
AGAWAM – The Department of Public Utilities (DPU) has announced that it would repeal the rule that required energy suppliers to retroactively charge consumers who switched to another supplier during the set term.
Officials from Western Massachusetts, including state Rep. Nick Boldyga, state Sen. Don Humason and seven others, led the charge for change by drafting a letter to the DPU asking for repeal. The letter was sent out in March, signed by both sides of the aisle from the State House and Senate.
The DPU announced the repeal on April 13.
The rule was originally put in place to protect energy companies and to make sure they “didn’t get the short end of the stick,” said Phil Kleinbohl, the legislative director for Boldyga. It would prevent customers from switching from the fixed-rate terms to a competitor when energy prices were up and going back when they were down.
Instead, it punished those who decide to switch in the middle of six-month fixed-rate term with, in some cases, thousands of dollars retroactively charged to the customer in addition to the rates they pay to their new company, Kleinbohl said.
“This rule has caused working-class people an incredible amount of stress and financial hardship especially since electric rates are already causing many to choose between heating their homes and putting food on the table. The elimination of this rule was the right thing to do,” Boldyga said in his release.
Though this was established in 2000, it was not until the area saw an increase in energy prices that this became a bigger problem. People were “calling and calling,” Kleinbohl said.
The biggest problem, Kleinbohl said, was that no one was informing the customers this would happen if they switched mid-term, neither the competing companies nor the DPU.
Two days after the letter was sent, the DPU reached out to competitive suppliers asking they inform people when they switched about the rule.
Even though this rule is effective throughout the Commonwealth, Kleinbohl said Western Massachusetts has been feeling the brunt of it, particularly since Eversource announced its rates would rise earlier this year.
Kleinbohl said other areas “weren’t feeling the pinch” as much as the western part of the state.
With the revoking of the rule, any customer who has switched after April 13 would not be charged. However, there will be no reimbursement for those who switched before the rule was removed.