BOSTON — Massachusetts Attorney General Maura Healey has released a report stating that individual residential customers who received their electricity from competitive suppliers in the last five years paid $426 million more on their bills than they would have paid if they had stayed with their utility companies.
The report shows that residents in Lynn, Fall River, Lowell, Brockton, and Lawrence lost more than $180,000 in the individual competitive supply market in the month of September, while Worcester residents collectively lost about $400,000 to competitive electric suppliers.
The report also shows that those suppliers charge higher rates to residents in low-income and communities of color in many of the state’s gateway cities.
“Our report shows that these companies continue to drain millions from communities across our state, and worse, our most vulnerable neighbors are being hit hardest in the midst of a deadly pandemic,” Healey said. “We’ve heard far too many stories of these companies going door-to-door and calling residents over and over with false promises of cheaper electricity bills, only to stick customers with a higher rate and a contract they can’t get out of.”
Healey noted it’s time to pass the legislation that she, state Sen. Brendan Crighton (D-Lynn), and state Rep. Frank Moran (D-Lawrence) filed earlier this year to protect residents from those inflated prices. The legislation would ban those companies from signing up new residential customers in Massachusetts.
This is the third report from the AG’s office that shows residents overpaying for those companies. Approximately 450,000 individual residential customers in the state enrolled with competitive suppliers lost $173 million in the two years included in the report.
“This report details the dishonest marketing and unfair contracts being used by competitive electric suppliers to take advantage of low-income rate-payers in gateway cities like Lynn,” Crighton said. “The legislation that I filed in partnership with Attorney General Healey and Representative Moran would put an end to these deceptive practices employed by these companies to prey on low-income consumers and those with limited English proficiency.”
“The Attorney General’s report once again finds that low-income residents in Massachusetts continue to pay too much to competitive electric suppliers for the same electricity that their utility company supplies for less,” added Jenifer Bosco, an attorney at the Boston-based National Consumer Law Center.
“Massachusetts customers have already lost hundreds of millions of dollars due to the deceptive sales practices of many competitive supply companies. Other states have stepped up to protect their residents, and it’s past time for Massachusetts to catch up and stop the financial harm to our families and neighbors, especially those who are struggling to pay their bills.”
The report did not analyze the market for commercial and industrial consumers, or the state’s approximately 150 municipal aggregation programs.
The division has recovered more than $15 million for Massachusetts consumers harmed by those companies. The AG’s office alleged that the companies collectively charged more than 117,000 residents millions more on their electricity than they would have paid had they received electricity from their utility companies.
Impacted customers will begin to receive restitution in April. The AG’s office also secured $3.8 million in restitution through a 2015 settlement with Just Energy and returned $4.6 million to customers it alleges were harmed by Viridian Energy in a March 2018 settlement.
The AG’s Office successfully called on the state Department of Public Utilities (DPU) in December 2019 to investigate the impact of competitive electric suppliers on low-income electricity customers in the state, the state’s low-income energy assistance programs, and the resulting costs to all taxpayers.
“For far too long, competitive supplier industries have taken advantage of the most vulnerable constituents in our Commonwealth,” said Moran. “It’s time that we provide relief to those struggling due to unfairly inflated utility bills.”
In January 2021, AG Healey refiled legislation that would bar suppliers from signing up new individual customers. The legislation would not affect the commercial and industrial market or Massachusetts’ municipal aggregation programs.
Residents in Massachusetts have filed more than 1,000 complaints with the AG’s office regarding that issue, with complaints including suppliers pretending to be utility companies to induce customers to turn over sensitive information, suppliers harassing customers with repeated calls or home visits, and door-to-door salespeople forcing their way into elderly customers’ homes and refusing to leave without signed contracts.
Any resident with concerns about these deceptive marketing practices should file a complaint with the AG’s office or call the consumer hotline at 617-727-8400. Residents with questions can also contact the Consumer Division of the Department of Public Utilities at 877-886-5066.