Electricity trick or treat?
Pro and con: Do competitive electricity suppliers help or hurt in Massachusetts?
Well-intentioned law has been corrupted by con men
BY DANIEL STEVENS
AS SUMMER SWINGS into high gear, our electric bills do, too. Modern life dictates that we need power to keep us cool. To try and reduce electricity prices for people living in Massachusetts, a few years ago, the state Legislature created a program called the competitive electric supply market, giving residents options to choose their electricity company.
According to Maura Healey, the Attorney General of Massachusetts, between 2015 and March of this year, residents who abandoned the state’s utilities paid more for their power than they would have if they had stayed put. At a press conference calling for the termination of the competitive electricity program, the Attorney General said: “In two years, Massachusetts residents lost over $176 million to these predatory companies. I’m calling for an end to this industry because that’s the best way to protect our seniors, low-income residents, and minority communities from these persistent scams.”
The problem with the competitive electric supply market is shady power companies use door-to-door salesforces that promise their customers lower energy prices but fail to deliver. What is so tragic about this situation is that the fraudster energy companies are targeting the least sophisticated customers who can ill afford to pay higher electricity prices. Sadly, Massachusetts isn’t the only state in New England dealing with the problem of disreputable electricity companies.
My organization, a corporate and government watchdog, is no stranger to businesses in the electricity markets that rip off their customers. For two years now, we have been closely tracking rooftop solar companies. Similar to how the competitive electric supply market created opportunities for crooks to overcharge people for electricity, government incentives for putting solar panels on homes also created an industry of bad actors that mislead customers on the savings they will accrue with rooftop solar panels.
Despite the leadership from Healey to protect customers from crooks that sell overpriced electricity and rooftop solar panels, neither Gov. Charlie Baker, nor the Legislature, have taken any serious steps to protect consumers in their state from shady salesforces in the electricity markets. The legislators will likely adjourn for the year soon. Before they do, we hope they will take up efforts to protect consumers, so residents of Massachusetts won’t have to spend millions of more dollars on overpriced electricity.
Daniel Stevens is the executive director of Campaign for Accountability, a government watchdog group in Washington, D.C.
Killing industry would cut choices for Mass. users
By TOM MATZZIE
MASSACHUSETTS IS A national clean energy leader. The state has expanded clean energy choices, increased incentives for renewable energy, encouraged development of wind, solar among other clean energy resources, and set the ambitious goals of reducing climate emissions by 80 percent by 2050. That leadership has delivered cleaner air and water, expanded consumer power in the energy marketplace, and resulted in a more resilient electric grid.
Furthermore, Massachusetts’s push for clean energy has increased the creation of in-state jobs—a lot of jobs. The latest Solar Foundation report shows the Bay State ranks second (behind only California) with more than 11,000 solar jobs and even more job potential with the state’s wind industry poised for success.
Much of the state’s renewable energy success has come from allowing people the freedom to switch to 100 percent clean energy by choosing to buy from a Renewable Competitive Supplier, such as CleanChoice Energy. Renewable Competitive Suppliers offer the millions of Massachusetts residents who want to do their part for climate but don’t have a roof for suitable for solar, the chance to get 100 percent renewable solar and wind through the retail electricity market. When a customer purchases renewable energy from a Renewable Competitive Supplier, the Supplier ensures that the electricity the customer uses is matched to clean energy sources with Renewable Energy Certificates. It’s easy, convenient, and is a choice that is made by hundreds of thousands of Americans each year.
While Renewable Competitive Suppliers have made a positive impact, too many bad actors in the energy service provider industry have pursued sales practices that have called into question the credibility of the entire retail electricity market. Those bad actors threaten to undermine the ability of good-faith Renewable Competitive Suppliers to continue to deliver clean energy to Massachusetts.
Massachusetts Attorney General Maura Healey recently released a report that focuses on the worst practices and the worst of the bad actors in the retail electricity industry—and calls to end the industry altogether. This would be a grave mistake.
Without a free retail electricity market, hundreds of thousands of Massachusetts residents would not be empowered to choose their electricity mix. Installing rooftop solar is a great option for homeowners who own their own (non-shaded) roof, but that is only available to a small percentage of residents. Community solar is a growing opportunity, but there is only a limited number of projects available.
While some customers also have access to municipal aggregations, 78 percent of municipal aggregations do not offer 100 percent renewable energy as the default option, contributing to the frustration of at least 74 percent of residents who are interested in wholly sourcing their energy from renewables.
Massachusetts residents deserve a market where they are treated fairly and can purchase the clean energy they need to fight climate change without getting stabbed in the back by shady sales people. Protecting consumers from unethical rate increases, making pricing and contract terms more transparent, and setting strong standard for renewable energy are among the reforms needed.
We urge decision makers to take steps to protect consumers from bad practices and increase price transparency. We support efforts to create a fairer, more transparent marketplace that enhances consumer protection and stops sales practices that hurt consumers.
However, we should beware of throwing the baby out with the bathwater. Ending the competitive retail electricity market will negate the forward progress made by the state. It would also be very unpopular. New polling shows that Massachusetts residents overwhelmingly want to be able to continue to be able to choose their energy supplier, choose clean energy, and want more renewable energy in the Massachusetts power system. Renewable Competitive Suppliers give Massachusetts customers power to decide how to spend their energy dollars and support the development and construction of new renewable energy projects in the region.
Keep Massachusetts the clean energy leader it currently is. Position the state to reach its emissions aspirations. Preserve the open energy market and let the people choose.Tom Matzzie is CEO and founder of CleanChoice Energy based in Washington, D.C.