Otis Bill Restricting Energy Service Companies’ Aggressive Telemarketing Passed

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Westchester -- Assemblyman Steve Otis (D-Rye) is pleased to announce passage of his bill that would protect energy consumers by establishing telemarketing standards for energy services companies (ESCOs) in New York State. The bill passed the Assembly last Tuesday, June 17. The Senate version of the bill, sponsored by Senator Savino, passed the following day.

Every day New York consumers are inundated with unwanted, and in many cases, untruthful solicitation calls from energy services companies. It is not uncommon for a consumer to receive multiple calls from a single ESCO in any given day. A8164-B would require any registered ESCO and its marketing representatives to remove a customer from an ESCO marketing database upon his or her request.

The bill also specifies that ESCO marketing representatives must provide their name, the name of the ESCO they are calling from, and the purpose of the call. It would further authorize the New York Public Service Commission (NYPSC) to enact a civil penalty of up to $1,000 per violation for any ESCO that knowingly fails to meet these conditions.

“Consumers have been besieged with repeated, unwanted solicitation calls from energy services companies, which rely on misinformation and aggressive marketing tactics to confuse customers. Those practices are simply unacceptable and make it much easier to engage in predatory behavior,” said Otis. “This measure is a much-needed safeguard that empowers customers by allowing them to opt-out of ESCO telemarketing calls and offers strict penalties to deter these companies from engaging in these abusive sales practices.”

A NYPSC proceeding that began in October 2012 called attention to serious concerns about the marketing behavior of ESCOs in New York, finding that some ESCOs are engaging in marketing practices that create and rely on customer confusion. Otis’ bill aims to eradicate this confusion by holding these companies accountable to the customers they seek to serve.

In addition to the requirements mentioned above, ESCOs would also have to comply with certain requests during marketing calls. These include: indicating that contracting with an ESCO to supply energy services will not affect a customer's existing relationship with their utility; transferring a customer to a representative who speaks the customer's primary language; and using independent third party verification (as approved by the Public Service Commission) to enroll a customer.

“It’s imperative that we discourage unfair marketing practices, and this bill is a step in the right direction,” Otis added. “Almost all residents of New York State are consumers of energy services companies, and preventing these businesses from preying on potential customers is just common sense.”

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