N.Y. PSC Issues Draft ESCO Consumer Bill of Rights
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October 1, 2010
The
New York PSC has posted a draft ESCO consumer bill of rights and modifications to
the Uniform Business Practices (UBPs) in Case 98-M-1343.
Legislation (A1558, S2361) requires the PSC to develop the consumer bill of rights,
and for it to be provided to customers during solicitations (Matters, 8/23/10).
The language of the draft consumer bill of rights is reproduced exactly as filed
below (including minor typographical errors):
Your Rights as an Energy Services Company
Consumer
ESCO Consumer Bill of Rights
All customers have a right to buy energy from an Energy Services Company (ESCO) or
from a traditional utility. All customers are entitled to a safe and reliable energy
delivery system, and fair and responsible treatment from their energy supplier. If
you choose to purchase energy from an ESCO you are entitled to:
- A clear description of the services offered by both the ESCO and the utility and
the knowledge that you are not required to choose an alternative energy supplier.
- Clear procedures for switching energy suppliers, including information about the
enrollment process.
- Disclosure, in simple and clear language, of the terms and conditions of the agreement
between you and the ESCO including:
- price and all variable costs or fees;
- length
of the agreement
- terms for renewal of the agreement,
- cancellation process and
associated fees, if any; and
- conditions, if any, under which the ESCO guarantees
cost savings. - Rescind an agreement with an ESCO within three days of receiving the agreement.
- A description of the provisions of pre-payment agreements if offered, including that
the ESCO cannot require a customer to pre-pay for service and that any contract providing
for prepayment may be cancelled by the customer, without any penalty or obligation,
within ninety calendar days from the date of the agreement. Any unused portion of
the prepayment must be returned to the customer by the ESCO within thirty business
days following receipt of notice of cancellation.
- A description of any early termination or cancellation fees provided for in the agreement.
An ESCO cannot impose Early Termination Fees exceeding $100 for a contract with
a term of one year or less, $200 for a contract with a term greater than one year,
or more than two times an estimate of your average monthly energy charge, which amount
must be provided to you at the time of the agreement.
- Notice from the ESCO, not less than thirty days nor more than sixty days prior to
the renewal date, of the renewal terms and of the customers option to reject the
renewal offer. The customer will not be subject to early termination or cancellation
fees if the customer objects to the renewal within three business days after receiving
the first billing statement from the ESCO under the terms of the agreement as renewed.
Further, an ESCO cannot change any material terms, other than price, without your
express consent.
- Residential customers who take service from an ESCO also have the rights and protections
of the Home Energy Fair Practices Act (HEFPA) (http://www.dps.state.ny.us/resright.html).
- A Fair and timely complaint resolution process.
- Provision of any written documents, such as contracts or sales agreements, marketing
materials, and this ESCO Consumer Bill of Rights, in the same language used to solicit
you.
- Any contract or sales agreement that does not comply with General Business Law (GBL)
§ 349-d is void and unenforceable. If an ESCO violates the requirements of GBL §
349-d, a customer may sue for damages.
Any agreement for energy services which does not comply with the New York State Department
of Public Services Uniform Business Practices could result in consequences against
the ESCO including revocation of its eligibility to provide services in New York.
The PSC also issued draft revisions to the UBPs to incorporate the requirement to
offer customers the consumer bill of rights, as well as to reflect other changes
contained in the enabling legislation.
Among other things, the draft revisions specify that for the purposes of setting
the capped termination fee based on average monthly usage, the ESCO may use an average
of the customer's actual usage for the previous twelve months, or if such data is
unavailable at the time the offer is made, apply the usage for a typical customer
in that service classification as reported by the distribution utility or the Commission,
and multiply it by the ESCO's estimate of the average annual rate that will be charged
under the agreement.
Regarding contract renewals, the modified UBPs would provide that, "with the exception
of a rate change, or an agreement that renews on a monthly basis with a variable
rate which was specified in the initial sales agreement, all other changes will be
considered material and will require that the ESCO obtain the customer's express
consent for renewal." Such consent shall be obtained using the forms of authorization
used for enrollments as contained in the UBPs.
For both in-person and telephonic marketing to customers, the ESCO representative
would be required to, "explain that he or she does not represent the distribution
utility; and, explain the purpose of the solicitation."
The revised UBPs add the following definition of door-to-door sales which tracks
the enabling legislation:
Door-to-door sales means, "[t]he sale of energy services in which the ESCO or the
ESCO's representative personally solicits the sale, and the buyer's agreement or
offer to purchase is made at a place other than the place of business of the seller;
provided that 'door-to-door sale' shall not include any sale which is conducted and
consummated entirely by mail, telephone or other electronic means, or during a scheduled
appointment at the premises of a buyer of nonresidential utility service, or through
solicitations of commercial accounts at trade or business shows, conventions or expositions."
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