AG WANTS TO PULL PLUG ON PUSHY POWER ALTERNATIVES

Attorney General Maura Healey wants lawmakers to bar third-party power companies from providing electricity supply alternatives due to predatory marketing tactics and a new report that says customers paid $176 million more over two years than if they had kept getting power from the utility.

The report yesterday found that residential customers who switched to an alternative supplier paid, on average, 2 to 3 cents more per kilowatt hour than they would have using a standard utility plan. The difference — amplified over hundreds of kilowatt hours per month for half a million customers across Massachusetts — cost $65.4 million from July 2015 to June 2016 and $111 million from July 2016 to June 2017.

The report detailed an increase in complaints against some electric companies’ aggressive marketing tactics, including teaser rates that later balloon, contacting people on the do-not-call list, or having representatives falsely claiming they are with a state agency or power utility. It also said the companies seemed to target low-income consumers.

In Hyde Park, Magalis Troncoso Lama’s monthly electric bill for her and her husband’s apartment jumped unexpectedly to $600. Confused, she called Eversource and was told her power supplier had been switched without her ever signing a contract.

“I’m very, very angry,” Lama said. “This is about workingclass people who are working very hard to stay in the economy, but it’s hard when you have to overcome these financial challenges.”

Healey, whose office this week secured a $5 million settlement from power supplier Viridian Energy over marketing tactics, backed the report’s finding that the millions in costs make it reasonable for lawmakers to end the competitive electricity market for residential consumers.

“It seems to me, if you see a space and a practice that where time and time again people are getting taken advantage of, people are getting hurt, we want to stop the bleeding and we want to make sure those practices end,” Healey said. “The competitive supply market has not and will not provide savings to residential customers in Massachusetts.”

Healey’s move comes as regulators in New York are considering making the same move there, after a similar report found $819 million in higher charges to ratepayers over an 18-month period.

The Retail Energy Supply Association, a trade group for competitive suppliers, said it was “dismayed” about Healey’s “sharp yet unfounded” call for an end to residential sales.

“While we welcome a thoughtful and transparent examination of the retail electric market, rushing to action to embrace the recommendations of the Attorney General based on a solitary and flawed analysis would be an irresponsible and costly course of action.”