Class action lawsuits filed against four energy suppliers in Connecticut
WEST HARTFORD – A law firm has filed class action lawsuits against four electric suppliers for deceptive practices.
The four companies accused of over-charging customers are Direct Energy, North American Power and Gas, Viridian Energy, and Discount Power.
The filing attorney, Robert Izard, of Izard Nobel, said the companies claim in their contracts that their variable rates go up and down with the wholesale price of electricity. But the lawsuits allege that the rates per kilowatt hour actually stay high when wholesale prices go down.
Izard argued state paperwork shows that rates can be as high as five times the wholesale price.
Consumers have a choice of which company supplies the power in their homes. Many choose to stay with CL&P. Others were lured by the promise of lower rates and have switched suppliers. The suppliers act as a broker, buying and reselling the energy at a higher price. Izard claimed customers sign up with certain electric suppliers when the original fixed rate is good.
“What you often get is a ‘teaser rate,’ it will last for three, four, five months,” Izard said. “And then when that teaser rate expires, it automatically shifts to a variable rate and that’s when people are seeing the big price jumps.”
Fox CT reached out to the companies being sued for comment, but only North American Power provided a statement that the lawsuit is absolutely without merit and that the company provides written notices to customers when their fixed rates are becoming variable rates.