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Ambit Texas, LLC would pay $323,100 under a settlement with Staff of the Texas Public Utility Commission (TPUC) to resolve alleged violations of 16 TAC § 25.480(j), related to deferred payment plans and other alternate payment arrangements, and 16 TAC § 25.480(m), related to placement and removal of switch-holds.

Excerpts from the Settlement:

“From January 1, 2023, to November 1, 2023, Ambit violated 16 TAC § 25.480(m)(2) on 5,564 occasions by failing to request within the required period of time the removal of the switch-holds after the customers’ obligation to the REP had been satisfied.”

“Between January 1, 2023, to November 1, 20223, Ambit violated 16 TAC § 25.480(j)(8) on 4,848 occasions by failing to send the required switch-hold release notification through a standard market process on the day it requested the switch-hold released.”

The settlement states that Ambit has implemented the following corrective measures to prevent violations of 16 TAC §25.480(j)(8) and (m)(2) from occurring:

1. Ambit added a unique system code for a switch-hold release notice to systematically identify and track the required notice.
2. Ambit’s switch-hold release notice process during the relevant period in 2023 was entirely manual regardless of whether the DPP was system generated or manually generated. Ambit has now automated the switch-hold release notification and fulfillment processes.
3. Ambit expanded the resources dedicated to the DPP and switch-hold management processes to coordinate the daily DPP and switch-hold review tasks and to provide oversight for quality assurance.
4. Ambit updated a query to identify customer accounts that have had a switch-hold removed and necessarily need a switch-hold release notice to be issued to ensure the complete population is accurately identified.
5. Ambit strengthened the daily DPP and switch-hold reviews to pinpoint specific customer accounts that may have satisfied a DPP and therefore require switch-hold removal.
6. Ambit revised and strengthened its training on this topic and retrained employees involved in these processes related to switch-hold removal and the related switch-hold release notification.
7. Ambit is refining the DPP functionality of its systems to allow more system created DPPs and commensurately reduce the number of manual DPPs created. Specifically, Ambit’s system changes are designed to allow customers who already have a DPP or who have broken a DPP to be able to enter into another DPP that is system generated. Ambit currently expects these changes to be implemented by the end of September 2024.
8. Ambit is developing system functionality to allow the dollar threshold for lifting a DPP to be more easily and quickly adjusted. Ambit currently expects these changes to be implemented by the end of September 2024.”

“The violations are serious in nature because they created a potential hazard to the economic welfare of the public. By failing to timely request, the removal of a switch-hold after the customer’s obligation to the REP related to the switch-hold is satisfied, Ambit temporarily prevented those customers from switching away to a different REP that may offer lower rates. By failing to timely put customers on notice of the switch-hold removal via the switch-hold release notice, Ambit decreased the likelihood of those customers shopping for lower rates. This effect can be particularly harmful to a customer on a variable rate plan because the rate can fluctuate between months. Switch-holds are meant to be used only as a way of increasing the likelihood that a customer will pay the deferred balance of a DPP. However, maintaining a switch-hold on customers beyond when they have paid off their DPP balance is a misuse of the switch-hold process and presents a potential hazard to the economic welfare of customers.”

Settlement Agreement And Report To The Commission (07/30/2024)
56821  (07/15/2024)
Settlement Agreement And Report To The Commission Regarding Ambit Texas, LLC’s Violation Of 16 TAC § 25.480, Related To Bill Payments And Adjustment