HARTFORD, Conn.(WTNH)- Connecticut has become the first state in the nation to ban contracts that force residents to pay a different amount for electricity each month.
On Wednesday, Senator Paul Doyle (D-Wethersfield) announced that Governor Dannel P. Malloy (D) signed a bill to ban variable-rate electricity contracts. Residents have complained to state officials for years that variable-rate contracts put a burden on consumers, as the electricity rates fluctuate significantly each month.
A press release from Senator Doyle’s office says that customers are convinced by agents at electric companies to sign variable-rate contracts, offering a low “teaser rate”, when in fact those rates can increase by over 100 to 200 percent on any given month.
Doyle spoke about the importance of this legislation Wednesday.
“When selecting their electricity supply contracts, Connecticut residents anticipate that they will receive stable and reasonable priced contracts. Unfortunately variable-rate contracts for our residents have proven to result in the opposite – large monthly price variations and large increases. This bill ensures our residents will receive stable, predictable electric bill.”
Last year, the General Assembly passed Public Act 14-75, enacting reforms to protect electric consumers. A significant component of this act requires electric companies to display the rate for the coming month, before being charged. That requirement is due to take effect on July 1st, however Connecticut has gone further by signing a bill to ban all variable-rate contracts.
The new bill banning variable-rate electric contracts will go into effect October 1st, 2015.