ENH Power parent firm accused of false advertising
The parent company of the biggest player in the competitive market for residential power supply in New Hampshire has found itself in hot water in Maine.
The Maine Public Utilities Commission is looking into whether Electricity Maine, an affiliate of ENH Power, engaged in false advertising when the company ran ads suggesting it had lower rates than the default energy supply rate, or standard offer, as it's known in Maine.
ENH Power and Electricity Maine are both owned by Provider Power, headquartered in Auburn, Maine.
Electricity Maine has attracted more than 180,000 customers in Maine in the past two years by offering an energy supply charge lower than the state-sponsored "standard offer." ENH Power has attracted 55,000 customers in New Hampshire using a similar strategy against Public Service of New Hampshire's default energy supply rate.
But on March 1, Maine announced a new standard offer of 6.82 cents per kwh for the next 12 months in the area controlled by the largest regulated utility, Central Maine Power.
The Electricity Maine's offer in that same area is 6.80 cents on a six-month guarantee, 7.78 cents for 12 months and 7.58 cents for 18 months.
After hearing advertising in which Electricity Maine continued to promote rates below the standard offer, the deputy general counsel for the Maine Public Utilities Commission sent the company a letter seeking some answers. Those answers could determine whether the regulatory agency launches a full-scale investigation.
"What we're interested in is whether their promotions and their activities are reasonable or whether they're deceptive, whether customers understand what's going on in this newly created market," Deputy General Counsel Mitchell Tannenbaum told the Lewiston Sun-Journal.
The need for competitive energy supply companies to adjust their marketing message as the regulated default rate changes will soon be reflected in New Hampshire as well. PSNH has applied for a rate reduction in the energy supply charge from 9.54 cents per kwh to 8.89 cents per kwh.
Competitors in New Hampshire are likely to continue to offer lower rates, but will no longer be able to claim savings of 25 percent or more, as has been the case, if the new PSNH rate takes effect in July.
"We are familiar with the PSNH rate change request that would become effective July 1, and are being very sensitive to those changes," said Emile Clavet, co-owner of Provider Power. "We'll make sure that our products, marketing and advertising reflect those prices."
Clavet described the letter from Tannenbaum as part of the routine interaction between the regulatory agency and competitive suppliers as the market evolves.
The ability to attract customers purely on price may have spurred competition, Clavet said, but that model is changing as more companies enter the market and default supply rates become more competitive.
In addition to value, Clavet said Electricity Maine and its New Hampshire counterpart are promoting price stability, green energy options and their Power to Help program, in which the company identifies local charities to get a portion of the customer's payment.
In New Hampshire, ENH has listed the New Hampshire Food Bank and the SPCA as community partners.
"We give them 2 percent of the energy supply portion of the electric bill as a donation," Clavet said. "Every year, we volunteer man hours on our dime to help the organization carry out its mission, and we provide technical and marketing support to their programs as well."