Door-to-door energy sales loophole leads to complaints

Alberta companies are taking advantage of a loophole in new legislation that bans unsolicited door-to-door energy sales, says the minister of Service Alberta.

"We have open investigations against a couple of companies that are, by all accounts, breaking the law and are going out there against the ban," Stephanie McLean said in an interview with CBC Radio's Edmonton AM.

"At the end of the day, we can set the laws. But if there are bad apples out there that are going to break the law regardless, that requires them to be reprimanded."

'That is a banned activity'

Changes to the Fair Trading Act, which came into effect Jan. 1, prohibit companies from selling furnaces, natural gas and electricity contracts, water heaters, windows, air conditioners and energy audits door-to-door.

However, some operators are risking hefty fines and jail time to entice new customers into signing up for energy contracts. And they're doing it with a kind of bait-and-switch sales tactic.

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Salesmen tell customers that they're selling un-banned items, such air filters or LED light bulbs. But once they've made it through the door, they begin pitching banned products, McLean said.

The minister said she's keen to see those companies prosecuted, and is willing to rewrite the legislation if complaints from consumers continue.

"That is a banned activity," McLean said. "No company can come to your door saying they're there about one thing, and then attempt, without your knowledge, to sign you up for something that is on the banned list.

"It may turn into a bit of a game of Whac-A-Mole, where I'm having to add things to the list. And I'm more than happy to do that."

'I was a little shocked'

Brendan Suwinski said he was approached last week by a salesperson from a company called Just Energy, who claimed to be selling high-efficiency light bulbs and air filters.

Suwinski said the salesperson soon started pressing him to sign a long-term contract. 

"He started asking me for my personal information, and then I realized, after about a minute, he was actually signing me up on a [contract] application as we were speaking," said Suwinski, who then asked the salesperson to leave. 

"That's something that is really concerning to me, is how an elderly person or someone else would be pressured into signing up without even realizing that they're doing it."

'People are taken advantage of'

Suwinski's partner, Naomi Parker, emailed Just Energy to complain.

The company responded, and said their sales staff "does not sell energy contracts at the door" and remains "fully compliant" with the new legislation.

Parker was not satisfied with the company's response. She said the current legislation leaves consumers vulnerable.

"I was a little shocked," said Parker. "I think they are looking for whatever loophole that they can to pressure individuals to sign up.

"At the end of the day, people are taken advantage of. I think it should be banned completely. Luckily, we stood up to them but not everyone does."

In a statement emailed to CBC News, a spokesperson with Just Energy said the company employs a "number of measures to ensure customer protection."

"We ensure that we are in full compliance with all regulations in every market we operate. Just Energy, in accordance with the Government of Alberta's ban on door to door energy sales, has stopped all sales of energy contracts at the door."

Just Energy said the company has a license to sell "environmentally responsible products" such as smart thermostats, air filters, and LED light bulbs" which fall within the government's permitted list.

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If a supplier is charged under the Fair Trading Act, the maximum penalty is up to $300,000 and two years in jail. The supplier can also be subject to administrative penalties of up to $100,000.

Before the ban was instituted, more than 1,000 complaints were lodged about energy-related, door-to-door sales, many from seniors and families who felt they were tricked into buying a new furnace or water heater on the spot.

In other instances, victims were pressured into signing contracts with salespeople, sometimes after two or three visits in a single day.

While there have been fewer complaints since the new laws were introduced, the NDP government remains concerned about the impact of high-pressure sales tactics, McLean said.

She's wants consumers to report any questionable salespeople to the government's consumer complaint line.

"It's really the best way for me to know what's going on on the ground level, on people's doorsteps,"McLean said. "We're willing to do what it takes to protect consumers."