SAN FRANCISCO (KPIX 5) — Deregulation of the energy industry allows California consumers a chance to shop around for gas and electricity providers. But consumers should watch out for pressure tactics to switch.

Karla Gallardo said she was duped, by a salesman who recently came knocking at her door. “They wanted to know if we qualified for one of the PG&E discount programs,” she told KPIX 5.

After looking at her PG&E bill, the salesman told her, “Yeah, you qualify. You’re going to save a lot of money.”

Gallardo signed up. Only later did she realize, “They actually aren’t associated with PG&E at all.”

It turns out Gallardo had unknowingly signed up with a completely different company, an alternate energy supplier called Commerce Energy.

“Basically what they are doing is buying gas for their customers, getting it to us, and we safely deliver it,” explained Joe Molica with Pacific Gas & Electric Co.

But Molica said unlike PG&E, the alternate suppliers are not regulated in California. “We do see a lot of these customer complaints. And it’s frustrating for us,” he said.

Commerce Energy is new to the Bay Area. But its parent company, Canadian based Just Energy, does not have a great track record.

There have been tens of thousands of complaints from across the U.S., from consumers saying they were misled into signing up. And instead of saving money, their bills went up.

The complaints led to a consumer fraud lawsuit by the state of Illinois, and investigations in New York, Ohio and Canada. Just Energy settled all of them by paying large fines, and promising to change its sales practices.

But a former employee told KPIX 5, here in the Bay Area that’s not happening. “The sales practices were completely unethical,” said Ernest White, who briefly worked for Commerce Energy’s local office. “From the get go they try to give the impression that they are with PG&E. And if you question it, that they are a supplier, the sole supplier of PG&E.”

White said his manager taught him tricks to get his foot in the door. “One was that this was a petition to lower prices, the other one was that this was something that Obama personally was backing,” he said.

And he said the pressure was intense, with quotas to fill, even incentives like free trips to Hawaii.

After numerous calls to Commerce Energy led nowhere, KPIX 5 paid a visit the company’s local office, hoping to get answers to the allegations. “When your employees go out do they first ask for a PG&E bill? Do they imply that they are with PG&E?” we asked.

A woman who appeared to be a supervisor told KPIX 5 she doesn’t do the field training. We asked if she was aware of all the complaints and the lawsuits filed in at least three different states. She told us all companies have issues. But before she could say more, a second manager called security, and we were asked to leave.

Later, Just Energy sent a statement to KPIX 5, saying “we take the issues you present very seriously and are anxious to identify the independent contractor involved.”

The company also sent a picture of a button they said sales people are also supposed to wear that says “we’re not the utility.”

But Ernest White said he never got one. And Karla Gallardo said her salesman didn’t have one either.

Gallardo was able to cancel her contract, but wants to warn others to be cautious next time you get a knock on your door.

Just Energy said it has made changes in its sales practices, mostly done through independent door to door marketers. As a result the company says complaints are way down.

Just Energy statement:

We take the issues you present very seriously and are anxious to identify and locate the independent contractor (IC) involved. All of our sales agents are required at the door to identify themselves as a representative of Just Energy (or a JE company, such as Commerce Energy), ensure their ID badge is clearly displayed, provide the homeowner with a branded business card/contact sheet, disclose the purpose of their visit, and that they are not affiliated with any local utility, the government or any consumer group. As an added measure to avoid confusion, our sales reps are required to wear a “We’re Not the Utility” button. The attached images reflect these requirements.

To further ensure customer protection, every enrollment is phone-verified through an independent third party. The call is to confirm directly with the customer if the IC clearly stated that they are a representative of Just Energy (or affiliate company) and clearly stated that he/she is not associated with the local utility. When we learn that an IC has breached our marketing standards, we will follow through – as we will in this case – with a thorough investigation and take any necessary corrective actions, including termination.

We recognize also that there will be instances where former salespeople may speak negatively about the company, however we take great pride in our training process, which is carefully designed to help all of our representatives abide by the highest standard in sales practices. Every one of our orientation classes include clear expectations with regards to professional conduct, company and regulatory requirements.

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

Comments (4)
  1. Years ago, I signed up for electric generation charges with a company that was far more eco-friendly than PGE (which isn’t hard because PGE is very eco hostile.) Commerce inc. bought that company and I stuck w/ it. Now it is “Just Energy Solutions.” Their last electric generation charges on my PGE bill were $18 less than PGE would’ve charged me. I know this because on pg 3 of the bill titled “Details of PGE Electric Delivery charges”, I see the “Generation Credit” which is $18 more than the Just Energy Solutions charge for electric generation. I have no complaints, but if you know of another company that charges even less, please inform. Also, I just switched to Arcadia Power so 50% of my electricity will come from wind power at 0 additional cost! Do it NOW:
    PGE is an evil corporation (Erin Brokovich, San Bruno inferno, lethal nuclear power plants etc.) that has the means and incentive to publish scathing reviews of competitors. It’s a monopoly but I say escape PGE as much as is possible.

  2. John Collins says:

    I fell for it. It took two months of bills to realize that this company is a scam. Now I have a Better Business Bureaus complaint against it asking that it eliminate it’s fine for breaking it’s contract. I have also threatened to take it to Small Claims Court unless it eliminates it’s penalty. Stay away from these sales scammers.

  3. Peter Kim says:

    My parents in California received PG & E bills with Commerce’s $29.99 monthly charges without even signing up. Those charges appeared out of nowhere. When we called PG & E, PG & E said they have nothing to do with Commerce and they cannot remove the charges and that we have to resolve the issue with Commerce. When we contacted Commerce, they said we have to pay a close to $300 fine to cancel the contract that never existed. When my parents refused to pay the Commerce portion of the PG & E bill, PG & E threatened to dis-connect the entire service. I thought it was only the Commerce company that was defrauding my parents but I am highly suspicious that PG & E is colluding to defraud California consumers. I am curious as to why the State of California is not filing a lawsuit like some of the other states. If anybody is thinking about filing a class action, please send me an email at Thanks.

  4. John Collins says:

    SFE said that I signed a contract and so it would not eliminate its fine for breakingg the contract. I wrote that if it did not drop its fine I would file a suit against it and would not only be asking for return of the fine, but all additional money that I had to pay above the normal PG&E charges. I mentioned that it would only pay $125 if it agreedd to my demand and if not it would not only pay much more but would also have a judgement against it if I win my case. It then offered to return $100 of its $125 fine. It sent a check to me which I cashed. SFE is a scam company. Stay away from it.

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