Press Release  Starion Energy Customers Will Begin Receiving Refunds As Part of $10 Million Settlement With AG’s Office

BOSTON — Attorney General Maura Healey announced today that customers of competitive electric supplier Starion Energy, Inc. (Starion) are beginning to receive restitution payments as part of a $10 million settlement reached with the AG’s Office over allegations that Starion used unfair and deceptive sales tactics to lure more than 100,000 Massachusetts customers into expensive contracts with high electricity rates. The settlement, which returns $7.25 million to impacted customers, is the largest reached by AG Healey’s Office and a competitive electric supplier.

“This company falsely promised thousands of Massachusetts customers big savings on their electricity bills, but instead overcharged them by tens of millions of dollars,” AG Healey said. “We’re glad to be returning more than $7 million to customers harmed by Starion’s deceptive tactics. We’ve seen this happen over and over with these companies, and we’re working to stop them from preying on our residents.”

The payments are part of a consent judgment the AG’s Office entered into in August 2020 with the company and two of its executives to settle the AG’s  October 2018 lawsuit that alleged that Starion violated the state’s consumer protection laws by engaging in unfair sales tactics, including unsolicited telemarketing calls and pre-recorded robocalls that falsely promised customers lower electricity rates. According to the AG’s Office, Starion collectively charged more than 117,000 Massachusetts customers millions more on their bills than they would have paid if they stayed with their utility company.

Customers who are eligible to receive restitution will be mailed a check and will not need to fill out a claim form. Customers are eligible to receive restitution if they:

• Purchased variable rate electricity service from Starion;
• Paid more than they would have paid their utility for basic service electricity; and
• Did not separately seek restitution through Starion’s Delaware bankruptcy proceeding.

To view a sample of the letter mailed out to customers who qualified for restitution, click here.

Customers in the first phase should expect to receive a check in April. Eligible customers who do not receive restitution during the first phrase of the program will receive restitution in a subsequent phase in 2022.

In addition to the $7.25 million going back to customers through the restitution program, the company is required to pay $250,000 in penalties that will go to the state’s general fund. Of the remaining $2.5 million in the $10 million settlement, $2 million will be forgiven if Starion complies with the terms of the consent judgment. As part of the settlement, Starion also contributed $500,000 to the AG’s Natural Gas Fuel Assistance Grant fund, which will be used to assist low and moderate income heating customers in the 2021-2022 heating season. The settlement also requires the company to ensure for three years that the amounts that low-income customers pay for electricity do not exceed what they would have paid if they received basic service through their utility company.

The Starion settlement is part of AG Healey’s ongoing efforts to protect Massachusetts consumers from unfair and deceptive practices in the competitive electric supply market for residential customers. The AG’s Office filed legislation last month that will bar competitive electric suppliers from signing up new individual residential customers. The AG’s Office has issued two reports on the impact of the market in Massachusetts, which together with an additional analysis found that, from July 2015 through June 2019, customers in Massachusetts who switched to a competitive electric supplier paid $340 million more for their electricity than if they had stayed with utility company. The AG’s reports also found that low-income customers and residents of color are disproportionately affected by the practices of competitive electric suppliers in the individual residential competitive supply market.

The AG’s Office has recovered more than $15 million for Massachusetts customers who have been harmed by competitive electric suppliers. This includes $3.8 million in restitution through a 2015 settlement with Just Energy and $4.6 million returned to customers harmed by Viridian Energy in a March 2018 settlement.

In the last four years, Massachusetts residents have filed more than 1,000 complaints with the AG’s Office about competitive suppliers engaging in aggressive and deceptive tactics including suppliers pretending to be a utility company to induce customers to turn over sensitive information; suppliers harassing customers with repeated calls or home visits; and door-to-door salespeople forcing their way into elderly customers’ homes and refusing to leave without a signed contract. 

Any consumer or retailer with concerns about a competitive electric supplier using deceptive marketing practices should file a complaint with the AG’s Office or call the consumer hotline at (617) 727-8400. Consumers with questions can also contact the Consumer Division of the Department of Public Utilities at (877) 886-5066. 

This case is being handled by Division Chief Nathan Forster, Assistant Attorney General Jacquelyn Bihrle, Energy Litigation Legal Support Specialist Adriana Bakhos, Analyst Bill Daniels, and Analyst Ben Griffiths, all of AG Healey’s Energy & Telecommunications Division, as well as Colleen Frost and Anthony Crespi of the AG’s Civil Investigative Division.

###