Gas customers taking a gamble with fixed rate program

by Sarah Rice (srice@wsbt.com)

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complaints filed with Indiana Attorney General's Office against U.S. Energy Savings

Four complaints have been filed with the Indiana Attorney General's Office against U.S. Energy Savings. (WSBT photo)

By WSBT News1

Story Created: Feb 28, 2008 at 5:46 PM EST

Story Updated: Mar 7, 2008 at 2:19 PM EST

SOUTH BEND — Heating bills constantly fluctuate and customers look for ways to save. But some are getting locked into a fixed rate they may not want.

NIPSCO offers customers what's called a Choice Program. It's a program made up of several independent gas suppliers.

One in particular is U.S. Energy Savings Corporation. Some of their representatives may have knocked on your door recently.

They do offer a legitimate program to lock customers in at a fixed rate. But I spoke with one person who signed up for it thinking it would save her money, and she says that's not what happened.

With her husband just home from Iraq, Kacey Fiekman couldn't wait to move into her new home this past July.

"We were really excited about moving here, and everything went pretty smooth all in all," Fiekman told WSBT News.

That's until someone came knocking on her front door. That someone was a representative from U.S. Energy Savings asking to see her NIPSCO bill.

"She said, 'Well we just want to make sure our name is on there to make sure that you're set in this price,'" said Fiekman.

And when the representative didn't see U.S. Energy's name on the bill, Kacey says they urged her to sign a contract for their long term fixed price program.

"Nothing wrong with that. Everybody wants to save money," said Fiekman.

So she signed on the dotted line. But Kacey says the representative didn't mention the rate, and Kacey didn't notice it on the contract. So when the bills started rolling in, so did the questions.

"I was like, 'What's going on here? I don't understand what happened!'" Fiekman said. "They were probably at least $50, anywhere from $40 to $100 more."

That's because Kacey's contract locked her into a rate at $1.14 per therm or per unit of heat. That's a big difference compared to NIPSCO's prices.

In 2006, NIPSCO charged customers an average of 74 cents per therm. In 2007 it was 73 cents. NIPSCO says this proves why customers should carefully look at their bills each month.

"Very important for a customer not only to look at what their actual monthly payment is, but also what they're paying per therm, especially if they're looking at signing up for one of these programs," said NIPSCO spokesman Mike Charbonneau.

A statement released from U.S. Energy Savings says the company offers stability, not savings: "Our sales representatives are carefully trained to explain the product carefully. They are not permitted to guarantee savings, as we cannot predict what the future energy prices will be.”

But Kacey says the representative did say she would save money.

“You almost felt like you were safe with what this person was telling you and then you realize it was all a lie," said Fiekman.

Officials can't stress enough that customers need to ask a lot of questions. This includes finding out exactly how much they'll be paying, how long the term will be and if there are any charges if customers decided they want to cancel.

Four complaints have been filed with the Indiana Attorney General's Office against U.S. Energy Savings.

The AGO says they're actively investigating these cases. Meanwhile, U.S. Energy says they will be looking into Kasey's case.

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