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Illinois governor signs new rules for alternative energy suppliers

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Illinois governor signs new rules for alternative energy suppliers

Alternative retail energy suppliers in Illinois will face new price transparency rules starting in 2020.

Gov. J.B. Pritzker on Aug. 27 signed into law a bill aimed at protecting consumers who choose to get their electricity or gas supply from a provider other than a utility such as Ameren Corp. subsidiary Ameren Illinois Co., Exelon Corp. subsidiary Commonwealth Edison Co. or WEC Energy Group Inc. subsidiary Peoples Gas Light and Coke Co.

Known as the Home Energy Affordability and Transparency, or HEAT, Act, Senate Bill 651 prevents alternative suppliers from switching a renewing contract from a fixed to a variable rate without first getting the customer's express consent. It also requires an electric or gas utility's comparison price to be included on all alternative supplier marketing materials and bills and be disclosed during telephone or door-to-door solicitations. Suppliers also have to give consumers 30 to 60 days' notice before a contract is renewed.

Pritzker, in a statement, called the bill passed by lawmakers in May "an important step forward in lowering utility costs across the state." The new rules take effect Jan. 1, 2020.

Attorney General Kwame Raoul and consumer advocacy group the Citizens Utility Board supported the bill.

Raoul said the HEAT Act would give his office stronger tools to shut down suppliers who "engage in fraudulent and misleading conduct" and to return money to harmed consumers.

Pritzker's approval of the bill came a little more than a week after Raoul said customers of three alternative retail electric suppliers would see refunds totaling more than $3.1 million.

Raoul on Aug. 19 announced settlements with Major Energy Electric Services LLC, Eligo Energy LLC and Realgy LLC. The attorney general alleged that the companies and their sales representatives used "aggressive and deceptive tactics" to enroll customers in the ComEd territory into "unnecessarily expensive" electricity contracts.

Under the settlements, the companies will provide refunds to more than 35,000 Illinois customers. Refund amounts will be based on customers' electricity usage, with most of the funds going to Major Energy customers.

Current and former customers of that company receive nearly $2 million in refunds, while current and former Eligo customers will get $1 million in refunds. A little more than $180,000 in refunds will go to current and former Realgy customers, Raoul said.

Along with having to refund customers, all three companies will be, or have been, suspended from certain marketing activities, Raoul said.

In Illinois, roughly 108 alternative retail electric suppliers are allowed to sell electricity, Raoul said. According to the attorney general, Illinois residential and small commercial customers who signed up with alternative suppliers have paid more than $870 million more for their electricity over the last five years than those who stayed with their public utility.