Former electricity customers to get checks

HARRISBURG, PENNSYLVANIA - About 20,000 former electricity customers of Utility.com in Pennsylvania will share nearly $200,000 recovered from the bankrupt company by the state Office of Consumer Advocate.

Consumer Advocate Irwin Popowsky said the former customers will receive checks averaging $10 in envelopes mailed from California but with the return address of his office on the outside.

"They're real checks," he said. "Don't throw them away."

Utility.com was active in Pennsylvania from late 1999 until the weekend of Jan. 20, 2001, when it informed customers it was leaving the state's retail electricity market. It was one of the more notable and popular of the competitive electricity providers that came to Pennsylvania after the electricity market was opened to competition in the late 1990s. Its heyday coincided with the peak of the Internet stock boom in the country.

Chris King, a former Pacific Gas & Electric executive who was Utility.com's CEO, told The Patriot-News in 1999 that the company could offer lower rates because being an Internet company enabled it to operate much more efficiently.

Popowsky recalled that Utility.com offered discounts of 20 percent off the rates of all the electric utilities in the state, even low-rate leaders such as Allegheny Energy. No one had any trouble getting electricity through Utility.com, but the company's finances collapsed when the wholesale price of electricity rose sharply, especially in California.

There have been few or no competitive choices for consumers in large parts of Pennsylvania since Utility.com left the market and went into bankruptcy.

Popowsky's office obtained a $125,000 settlement in 2001 on behalf of Utility.com customers in Pennsylvania who had paid in advance for a budget billing plan. The settlement announced today is a second action, this time on behalf of customers who had to buy more expensive electricity when Utility.com left the market.