Direct Energy

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Direct Energy
Type Energy retailer
Industry Energy
Founded 1985[1] or 1986[2]
Headquarters Houston, Texas
Key people Chris Weston MD International Downstream, Badar Khan CEO
Parent Centrica
Website www.directenergy.com

Direct Energy is a North American retailer of energy and energy services. The company was founded in 1986.[3] With more than six million customer relationships in Canada and the United States, it is the largest energy and home services retailer in North America.[4] The current President and Chief Executive Officer of the company is Badar Khan. Direct Energy is a subsidiary of UK-based Centrica plc, an integrated energy company.[5]

History[edit]

Direct Energy Office in Markham.

Direct Energy was founded in Toronto in 1986, as a competitive energy retailer. In 2000, the company was acquired by Centrica, the UK-based parent of British energy retailer British Gas.

From 2000 onwards, Direct Energy grew rapidly through acquisition. These acquisitions included Energy America (2000),[6] Enbridge Home Services (2002),[7] AEP’s Texas retail operations (Central Power and Light and West Texas Utility), the regulated retail operations of ATCO Gas and ATCO Electric in Alberta, Entergy Solutions Ltd.’s Electric Reliability Council of Texas customer base and Strategic Energy (2008).

In the area of energy services, Direct Energy acquired Luced Heating Contractors, BASE Controls Ltd., MABE Canada Inc.’s in-home service repair division, and the Residential Services Group.

In 2010, Direct Energy acquired Clockwork Home Services making Direct Energy the largest energy and home services retailer in North America . Clockwork has three brands:, One Hour Air Conditioning & Heating, Benjamin Franklin Plumbing and Mister Sparky, which specialize in plumbing, electrical and air-conditioning and heating and services.[8]

Direct Energy acquired a number of upstream assets, including gas reserves and power generation facilities. These include: Quintana Minerals Resources, Bastrop Energy Center, Frontera Energy Center, Paris Energy Center, and Rockyview Energy Inc. Direct Energy has entered into long-term power purchase agreements for 813 MW of electricity from five wind farms in Texas.

Direct Energy owns and operates approximately 4,600 natural gas wells in Alberta, most recently acquiring natural gas assets from Suncor Energy and Shell Canada.[9]

The company ’s new strategy calls for increased investment in North America, specifically to grow its upstream asset cover to 35-40%; it also plans to grow its downstream businesses in its core markets of Texas, US North East and Canada.[2] Chris Weston became President & CEO of Direct Energy on July 1, 2009 following the retirement of Deryk King.

Direct Energy announced in January 2012 that it will move its corporate headquarters from Toronto to Houston within the next 12 to 18 months. The headquarters will be in the Greenway Plaza location where the company's residential energy and upstream business are now based.[2]

In 2012, Iberdrola USA sold its energy services companies, Energetix and NYSEG Solutions, to Direct Energy.[2]

In 2013, Direct Energy made one of its biggest acquisition to date by purchasing Hess Energy Marketing for $1.03 Billion.

Products and services[edit]

Direct Energy’s U.S. operations span 46 states and the District of Columbia including: Texas, Ohio, Michigan, Illinois, Pennsylvania, California, Connecticut, Maryland, Rhode Island, Maine, New York, New Jersey, Delaware, Massachusetts, Florida, North Carolina, Kentucky, Indiana, Alabama, Oklahoma and Virginia. While not providing services to residential customers and businesses in Oklahoma, Direct Energy has established an Operations Center in Tulsa. In Canada, Direct Energy has operations in Ontario, Alberta, British Columbia, Manitoba, Quebec, Saskatchewan, Nova Scotia, Prince Edward Island, New Brunswick, and Newfoundland and Labrador.

For residential customers and small business, Direct Energy offers fixed price electricity and gas plans, as an alternative to the local utility or in competition with the local competitive energy providers. In Texas, Direct energy offers a pre-paid electricity plan, Power-To-Go.[10] In Ontario, Direct Energy rents water heaters to around 600,000 residential homeowners.[11] Through its services division, Direct Energy installs and services heating, ventilating and air conditioning equipment. It also can perform energy retrofits and other energy management projects at larger facilities. Direct Energy’s Home and Business Services division employs over 1,400 technicians providing residential customers with heating, ventilation and air conditioner (HVAC), plumbing, home improvements, water heater and electrical appliance services.[12]

Direct Energy is a regulated gas and electricity provider in Alberta, operating under the Direct Energy Regulated Services brand. It also offers deregulated service in the Province, operating as Direct Energy.

In South Texas, Direct Energy operates as CPL Retail Energy and CPL Business.

In West Texas, Direct Energy operates as WTU Retail Energy and WTU Business.

Controversies[edit]

March 2012 - Direct Energy tried to impose new contract terms on 500,000 rental water heater customers through negative option marketing leading to a public apology and rollback of its plan last March 15, 2012.[citation needed]

Direct Energy was fined C$157,500 in 2003 after investigators discovered 21 forged contracts trapping customers into long-term energy deals.[13] According to Paul Massara, then the president of the company, the forgeries took place between June 2001 and April 2002. Both Direct Energy and a company it acquired, Energy America were charged with employing unethical business practices, with Energy America being fined over $500,000 in penalties for enrolling customers without permission and using deceptive sales pitches. The companies were found to have used unethical business practices in Michigan, Georgia, Texas, Ontario and Manitoba.[14] The Ontario government has since passed a bill that would require energy retailers to follow up on each contract sold to ensure the customer had willingly made the purchase.[15]

During the investigations, the company frustrated investigators by withholding and concealing evidence, failing to respond to complaints, failing to respond to subpoenas for court appearances and generally ignoring demands to comply with the investigation. The U.S. branch of the company was taken to court by a customer in 2002. The judge in the case removed himself after being solicited for a contract by Energy America, citing a concern that he was now a potential witness in the case. Before the hearing could be re-scheduled, the complainant settled out of court with the company on the condition that he no longer discuss the case publicly.[16]

Deregulation position[edit]

CEO Chris Weston has given several speeches stating the need for deregulation of the energy market and the need for consumers to pay the actual price for energy rather than what he considers its current artificially low position. Weston spoke at KEMA’s 21st Executive Forum on the benefits of a competitive energy market and the value it has to consumers.[17] He has also authored opinion pieces on the subject.

Community investment[edit]

Direct Energy promotes volunteerism amongst its employees within their local communities.[18] Direct Energy claims that its employees logged more than 10,000 hours of volunteer service across North America in 2010.[18] Through the Western Pennsylvania Conservancy,Direct Energy employees planted 400 planters throughout downtown Pittsburgh.[19]

See also[edit]

References[edit]

  1. ^ http://www.taleo.com/customers/media/pdf/CS_US-DirectEnergy.pdf
  2. ^ a b c d Direct Energy Business LLC sources
  3. ^ "Direct Energy Business LLC sources". 
  4. ^ "British company buys Clockwork". Gulf Coast Business Review. June 10, 2010. Retrieved April 12, 2011. 
  5. ^ Stockhouse, “Great Plains Energy, Inc. Q1 2008 Earnings Call Transcript.” 5/9/2008
  6. ^ Byfield, Mike. “Wes Moringstar: Direct Energy Thrives on 40 Mcf Wells.” DOB Magazine. April 2008
  7. ^ Ottawa Citizen. “Centrica Buys Enbridge retail unit for $1 billion.” The Canadian Press. 29 January 2002
  8. ^ "British company busy Clockwork". Gulf Coast Business Review. June 10, 2010. Retrieved April 12, 2011. 
  9. ^ "Direct Energy gains assets from Shell Canada". The Globe and Mail. April 2, 2011. Retrieved April 12, 2011. 
  10. ^ "Direct Energy and NRG Collaborate on EV Charging Solution". SmartMeters.com. November 20, 2010. Retrieved April 12, 2011. 
  11. ^ "Direct Energy gives extra month to change water-tank policy". toronto.ctv.ca. March 14, 2012. Retrieved March 14, 2012. 
  12. ^ Jaremko, Gordon. “Direct targets service firms: Gas marketer accelerates acquisition plans.” The Edmonton Journal. 27 Aug. 2004, Edmonton ed.: F1
  13. ^ Robertson, Grant (May 16, 2004). "Hit by the sales pitch". Calgary Herald. Retrieved February 7, 2012. 
  14. ^ Robertson, Grant (May 16, 2004). "Part Three: So many complaints, no quick fixes". Calgary Herald. Retrieved February 7, 2012. 
  15. ^ [1]
  16. ^ Robertson, Grant (May 16, 2004). "Province told of consumer concerns in U.S.". Calgary Herald. Retrieved February 7, 2012. 
  17. ^ Weston, Chris. "The Future of Retail Energy Markets in North America". KEMA 21st Executive Forum. Retrieved April 12, 2011. 
  18. ^ a b Bain, Jennifter (January 14, 2011). "Creative solutions to handle food waste". The Toronto Star. Retrieved April 12, 2011. 
  19. ^ Holden, Keith (April 1, 2011). "Trib-Live Photo Gallery". Pittsburgh Tribune Review. Retrieved April 12, 2011. 

External links[edit]