|This article needs additional citations for verification. (June 2012)|
|Industry||Retail electricity provision|
|Key people||Rob Snyder Chairman
Mark Schiro President, CEO
|Employees||245 (October 2012)|
Stream Energy is an American retail electricity and natural gas firm active in states which have deregulated energy markets. The company is headquartered within the Infomart building in Dallas. Stream Energy uses multi-level marketing to recruit independent distributors through its marketing division, Ignite. The company provides services to both residential and commercial customers.
Stream Gas & Electric Ltd. (d/b/a Stream Energy) was founded in August 2004 after the deregulation of the Texas electricity market. Stream Energy was licensed as a retail electrical provider by the Public Utilities Commission of Texas on 21 January 2005 and formally began operations through the initial enrollment of Texas electricity customers on 7 March 2005. The company has since expanded to other states. The company has expanded, and also operates in Georgia (2008), Pennsylvania (2010), Maryland (2011), New Jersey (2011) and New York (2012).
Stream Energy operates a separately-branded marketing arm, Ignite, to implement multi-level marketing in the company. Substantively employing the same model as Excel Communications, Ignite associates earn commission through the gathering of energy customers. They also earn income when the sales agents they recruit into the business gather a required number of energy customers. All money paid through the Ignite sales organization is solely attributed to customer gathering activities.
Local meetings known as "Business Presentations" are held to promote the concept. Sales associates also maintain Ignite internet-based "homesites" that serve as informational web forums for recruits.
In 2009, class-action lawsuits were filed against the company in Texas and Georgia on behalf of sale associates. The suits allege that the company is acting as a pyramid scheme which is substantially more active in recruiting sales associates than in recruiting new customers. In Georgia the suit was dismissed on procedural grounds. As of 2014, the suit in Texas remains ongoing. Scott Clearman, the attorney who filed both suits, has also alleged that sales associates are specifically trained to avoid discussing rates, since Stream Energy's customers in Texas pay substantially higher rates than the state's monopoly customers.
In 2010, the sign-up cost in Georgia was $300, with a $25 monthly fee to maintain a website. Associates typically received between $0.50 and $3 a month per customer they recruit. Approx. 90% of associates were reported to lose money, 8.5% made no profit, and 1% made minimum wage incomes, with the remainder making more substantial profit.
During 2011, the average annual income of associates was $692.58, which represents 89.49% of all associates who qualified.
- Mencimer, Stephanie (January–February 2014). "Electric Shadyland: How Power Companies Rip You Off". Mother Jones Magazine. Retrieved 24 April 2014.
- M. B. Pell; Margaret Newkirk (6 December 2010). "Selling energy -- and prosperity?". The Atlanta Journal-Constitution. Retrieved 24 April 2014.
- Lieber, Dave (1 March 2014). "Watchdog: Stream Energy target of racketeering class-action lawsuit". Dallas Morning News. Retrieved 24 April 2014.