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Regulator To Revisit Decision Denying Retail Supplier's License Change Due To Complaint Record

September 28,2017

The Illinois Commerce Commission granted a request to re-hear (granted rehearing to reconsider the matter) an August order which had denied the application of Spark Energy, LLC for an Alternative Retail Electric Supplier license.

This proceeding concerns Spark Energy, LLC’s application for a certificate of service authority to operate as an Alternative Retail Electric Supplier (“ARES”) under Section 16-115 of the PUA. The Commission previously granted Spark Energy, L.P. a Certificate of Service Authority to operate as an ARES pursuant to Section 16-115 of the PUA. Spark Energy, LLC was formed when Spark Energy, L.P. converted from a Texas limited partnership to a Texas limited liability company by filing a Certificate of Conversion in Texas. Spark Energy, LLC filed the instant proceeding after it was directed to withdraw its March 17, 2017 Petition for Approval of Pro Forma Changes including Limited Partnership Conversion to a Limited Liability Company and file a new application requesting cancellation of its existing Certificate of Service Authority issued to the limited partnership in Docket 08-0020 and issuance of a new Certificate of Service Authority to the limited liability company to provide service as an ARES.

An ALJ had recommended approval of Spark Energy, LLC’s application for a certificate of service authority to operate as an Alternative Retail Electric Supplier

However, in an August order, the ICC denied Spark Energy, LLC’s application, citing Spark's complaint history

"Applicant’s Petition and subsequent filings included no evidence that informs the Commission’s consideration of Applicant’s 'involvement in the Commission's consumer complaint process, including the resources the alternative electric supplier dedicates to the process and the alternative electric supplier’s ability to manage the issues raised by complaints," the ICC said in its August order

The August order cited the PlugIn IL informal complaint stats, but otherwise did not specify the exact number of complaints causing concern (other than a reference to the number of complaints filed against Major Energy, which is now a Spark affiliate, but as noted by Spark in its rehearing request, was not an affiliate when most of such complaints were filed)

"With Applicant’s formal and informal complaint record, the Commission cannot conclude that it is appropriate to grant a certificate of service without a proper consideration of Applicant’s resources dedicated to its consumer complaint process and the Applicant’s ability to manage the issues raised by complaints, and the steps it takes to resolve the complaints. Applicant provided no information to permit the Commission to make such a consideration. Accordingly, the application is denied," the ICC said in its August order

Spark sought rehearing of the order

Among other things, Spark argued that the ICC misapplied relevant rules concerning the required showing of managerial fitness, and that the ICC's citation to a lack of information from Spark in its application concerning its complaint handling process (etc.) was because Spark provided other evidence meeting the requirement that, under the rule, "shall" be deemed as demonstrating an ARES possesses the requisite managerial capabilities to serve retail customers.

However, Spark said that it is fully willing to provide the complaint handling and customer service information identified by the Commission on rehearing, and provided such information in its rehearing request

Spark said that it has dedicated significant resources to providing exceptional customer service and addressing customer complaints, and detailed its various compliance and quality control processes

Spark further said that its Illinois informal complaint statistics do not indicate a lack of managerial qualifications, are improving, and need to be considered in the proper perspective

"While Spark continues to work to achieve lower complaint numbers, Spark’s total informal complaint numbers for the last six reporting periods are relatively modest in size with the average number of monthly informal complaints ranging from a high of 8.7 complaints (52 over 6 months) to a low of 5.7 complaints (34 over 6 months). The 34 complaints from October 2016 to March 2017 represent a complaint ratio for Spark of approximately 0.11%. More importantly, the high of 52 complaints is for the oldest 6-month reporting period while the low of 34 complaints is for the most recent 6-month reporting period," Spark said

Spark also said the ICC erred in concluding Spark Energy LLC does not posses a license as a result of its conversion from the LP

"Spark submits that under the law its conversion to a limited liability company neither terminated its existence nor assigned its Certificate of Service Authority. Rather, Spark continued to exist without interruption in the organizational form of the converted entity, and all property owned by the converting entity (Spark Energy, L.P.) – including the property interest represented by Certificate of Service Authority issued by the Commission – continued to be owned by Spark in the new organizational form. As a result, Spark maintains that the Order was contrary to law because and to the extent it disregarded Spark’s existing grant of a certificate and purports to deny Spark its property interest in the Certificate of Service Authority without the appropriate due process protection," Spark said

The ICC granted rehearing and will now reconsider the matter

Spark Energy said in a statement to that, “Spark is working diligently with the ICC to resolve this issue and continue to serve our customers in IL.”

See more information on the case at the link below, including Spark's full rehearing request, and the ICC's order

Link: Docket 17-0273


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