State crackdown on energy suppliers on verge of becoming law
By Steve Daniels, Crain’s Chicago Business. May 28, 2019
Illinois Attorney General Kwame Raoul has struck a deal with Exelon, the largest retail supplier in the state, on legislation that would halt many of the misleading marketing practices that have enabled energy firms to lure customers away from Commonwealth Edison and then charge them considerably more than they would have paid the utility.
The state Senate easily passed the bill early this month over the objections of the industry, but it got hung up in the House. House Democratic leaders wanted Raoul to negotiate something acceptable to the largest players in the business. And that principally meant Exelon, one of the most politically potent companies in the state and by far the dominant player in the industry as the owner of ComEd and the largest Illinois power generator.
Another major player in the residential market, Houston-based Direct Energy, had argued that not allowing any automatic renewal would effectively kill residential competition in Illinois.
Even in cases where contracts are automatically renewed to fixed prices, consumers would be allowed to exit the deals with no exit fees or financial penalties.
In a sign the bill is likely to move quickly through the House, Republican Leader Jim Durkin, R-Western Springs, became a co-sponsor late last week, along with several other key Republicans.
“We believe the (bill) reflects the attorney general’s priority of protecting consumers at every stage—from the time a marketer shows up at their door to when they want to get out of a bad contract,” a spokeswoman for Raoul said in an email.
“Attorney General Raoul deserves a lot of credit here,” said David Kolata, executive director of the Citizens Utility Board, which backs the reform effort. “We think the outcome is very good. This is a very substantive reform and will move the ball forward in reforming an industry that’s been a problem for years.”
An Exelon spokeswoman confirmed the company endorses the compromise.
Kevin Wright, president of the Illinois Competitive Energy Association, didn’t respond to a request for comment. His group represents some but not all suppliers active in Illinois, including Exelon.
Other major provisions include a requirement that ComEd’s comparable price be disclosed on suppliers’ marketing materials and on all customer bills, so that consumers will have more of an opportunity to notice when they’re paying too much.