We all know the marketing advantages of name recognition. Now, one Illinois energy retailer that has been relying on its status as a household name to recruit customers may have to find a new moniker and logo, if the Citizens Utility Board (CUB) in Chicago has its way.
Since its launch in 2007, gas retailer Nicor Advanced Energy has been allowed to use the same name and logo as its sister company, Illinois' largest gas utility, Nicor Gas – a regulated provider that serves 2.2 million customers in the northern and central parts of the state. Now state regulators are being asked to force Nicor's parent to drop the utility's name from its non-utility business, Crain’s Chicago Business reported this month.
Indeed, CUB claims that the retailer’s plans are deceptive and that many customers do not understand the relationship between the company and their utility. “By signing up for Nicor Advanced Energy, you are paying that unregulated company for its gas. You will still pay your utility to deliver that gas to your home,” the advocacy organization’s website says.
“The vast majority of the offers are money losers,” CUB Executive Director David Kolata told Crain’s. “We've never found anyone who's saved. What you're buying is an insurance policy. The premiums you're paying for that are extraordinarily high.”
The consumer advocates, led by Illinois Attorney General Lisa Madigan, say unregulated suppliers shouldn't be allowed to adopt any utility's name and logo to sell above-market-priced gas. Madigan, along with CUB, wants the Illinois Commerce Commission to bar use of the Nicor name to sell retail gas as a condition of approving Atlanta-based Southern's pending $8 billion buyout of Nicor Gas parent AGL Resources, also of Atlanta. The ICC must rule on the merger by September.
In testimony filed with the ICC, AGL Resources Executive Vice President Henry Linginfelter stated that the commission had permitted the use of the Nicor name and logo in the past and that it shouldn't reconsider that in the context of the merger.
Nicor Advanced Energy has an estimated 70,000 customers, most of them households in Nicor Gas' service territory.
