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Big refund for Major Energy customers

When CUB conducted a review of the worst alternative electric deals in spring of 2014, we smelled something fishy.  For example, we encountered several customers on plans charging up to six times the utility’s rates!

And what company were those particular customers with?  Major Energy.

Those customer may receive justice this week.  The staff of the Illinois Commerce Commission (ICC) and CUB on Wednesday reached a settlement with Major Energy to refund current and former customers $262,500, following allegations of misleading marketing. (Read CUB’s full release on the refund here.)

“We thank the ICC for taking action to improve Illinois’ electricity market,” CUB Executive Director David Kolata said. “Alternative electricity suppliers need to know that the Illinois electric market has no place for underhanded marketing practices.”

The ICC opened a formal investigation of Major Energy in August 2014, after receiving more than 100 complaints about the New York-based company. ICC staff alleged that Major Energy violated the law by using marketing pitches that were incomplete, inaccurate and misleading.

The settlement, approved by the ICC on Wednesday, requires that Major Energy refund $262,500 to current and former customers who may have been misled during enrollment from 2012 to 2014.  It also stipulates that the company must:

  • Clearly prohibit representatives from giving the impression they are with the regulated utility.
  • Clearly prohibit representatives from leading customers to believe they will automatically save on Major Energy plans.
  • Translate marketing materials and pitches into Spanish to prevent Spanish-speaking consumers from being misled.

All residential and small business customers enrolled from 2012 to 2014 are eligible for a refund.  To receive a refund, you must contact Major at 1-888-625-6760 within 12 months of receiving a notification letter and present a “reasonable claim” that you believe you were misled, uninformed or confused because of Major’s actions during your enrollment.

Refund amounts will be calculated on a case-by-case basis, depending on a number of factors, including your enrollment circumstances, contract terms and the utility’s price to compare at the time of enrollment.

We also want to take the opportunity to remind Illinois consumers to be smart shoppers and beware of these pitfalls:

Exorbitant rates: Ask for details on the price, and how it compares to the regulated utility’s rate.

Low introductory rates that disappear: Introductory rates may shoot up after a short period. Always ask if the rate being offered is introductory, how long it lasts, and what happens to the rate after the initial period.

Extra Fees: Ask if there is a monthly fee, and factor that into the per kilowatt-hour (kWh) price.

Punishing Exit Fees: Many suppliers charge exit fees of more than $100 if a customer leaves a plan before the contract is up. Under the law, you can leave a contract without paying an exit fee within 10 days after the date of the first bill from a supplier.

High pressure sales tactics: Beware of people at your door who say they’re from the “electric company.” Don’t give out your account number or power bill to just anybody who asks for it. That person may be trying to sign you up for an offer without your permission.

Questions? Call CUB’s toll free consumer hotline at 1-800-669-5556 for more information.