‘Competitive’ energy scheme a boon for bottom feeders

The notices arrive in my mailbox at the rate of one or two a week — always marked “important” and looking semiofficial and offering a chance to lower my electric bill. Well, who wouldn’t want that?

At least no one comes to my door with a clipboard, a contract, and a gift for the hard sell — a predatory combination that, according to the attorney general, has collectively cost Massachusetts residents who took the deal an extra $525 million on their electric bills over the past six years.

Yes, the state’s 25-year experiment with a “competitive” residential electric market has been at best a mixed bag for consumers and at worst yet another way for bad actors in the industry to prey on those who can least afford it — the poor, the elderly, immigrants with limited English skills, and more than a few wellintentioned college students who think they are saving the earth.

“We work on the assumption that most of the folks in the industry are bad actors, not good,” Attorney General Andrea Campbell told a legislative committee Monday.

The idea seemed like a promising one back in 1997 when Massachusetts was among about a dozen states that jumped on the competitive energy bandwagon, allowing companies other than the major ones like Eversource or National Grid to sell directly to individual residential customers. Competition brings down prices, right?

Well, according to a report issued last month by the attorney general’s office, some people did save money — collectively nearly $9 million over what they would have paid to their regular electric supplier. But they were a fortunate few indeed, and the average annual savings per consumer was $40.36. For that same 12-month period between July 2020 and June 2021, other consumers paid some $108.4 million more than if they had stuck with their old plans — an average annual cost of $267.67.

That burden fell most heavily on low-income residents and those living in the state’s Gateway Cities, including Springfield, Worcester, Fall River, Lowell, Lawrence, and Lynn, Campbell testified. And it’s the marketing that has proven both targeted and predatory.

“They are relentless, going door to door, making calls, filling your mailbox with promises,” Campbell said. “But these promises are false.”

And that includes promises of being “green and clean.”

Elizabeth Mahony, commissioner for the state Department of Energy Resources, testified that when it comes to clean energy programs “this industry doesn’t contribute in any meaningful way.”

In fact, “Customers are paying a premium,” she said, without the companies involved having to make any investment in the New England energy grid, as major utilities do.

Governor Maura Healey, Campbell, and Boston Mayor Michelle Wu are all supporting an “end it, don’t mend it” approach to the state’s experiment with competition in the residential market in the form of a bill that would ban such suppliers from signing up new individual residential customers after Jan. 1, 2024.

Stricter enforcement and more guardrails around rates — some states have a “meet it or beat it” approach to competitive rates — would certainly help, Mahony said. But all of that comes with a cost. Illinois has a seven-person bureau to monitor compliance, she added. Even then the system is not without its critics.

“So to what end are we spending our resources?” she asked.

The attorney general’s office has amassed more than 700 complaints from consumers about rates and tactics. And while the office has gotten some $19 million back for consumers, settlement agreements can take two years or more and a significant amount of staff time to negotiate, according to Liz Anderson, chief of the AG’s Energy and Telecommunications Division.

The Department of Public Utilities has also fielded consumer complaints. But as Michael Judge, current undersecretary of energy and former

DPU official, testified, substantiating those complaints was nearly impossible, especially when companies simply didn’t play fair. DPU staff believed copies of high pressure recorded sales calls were routinely edited before being turned over, he told lawmakers.

So those are the folks we’re dealing with here in this great “competitive” marketplace Massachusetts once envisioned. “This is not just a few bad apples,” Judge insisted.

The notion of a competitive marketplace in electricity was a worthy experiment that has gone horribly astray. A sensible Legislature would simply end it.

The notion of a competitive marketplace in electricity was a worthy experiment that has gone horribly astray.