RESA Opposes Affirmative Customer Consent Requirement for N.Y. Renewals

Email This Story
November 15, 2010

The New York PSC should not require the express consent of customers for ESCOs to renew such customers, the Retail Energy Supply Association said in comments regarding the proposed ESCO Consumer Bill of Rights and related changes to the Uniform Business Practices (98-M-1343).

As only noted in Matters, the PSC has proposed requiring that, for renewals, "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 (Matters, 10/1).

RESA noted that the enabling legislation does not require such additional consent for renewals.  The law is explicit, however, that the PSC may adopt additional guidelines, practices, rules or regulations governing the renewal process.

RESA sought clarification with regard to products that roll-over onto monthly variable rates.  While the proposed UBPs allow such roll-overs without additional customer consent, the proposed regulations require that the variable rate which customers will pay at the end of the term be "specified" in the initial contract.  RESA noted that for market variable rates, the contract will typically only specify a rate methodology to determine the variable rate to be charged, and will not list the variable rate itself.

The National Energy Marketers Association asked the PSC to clarify that the proposed renewal notice provisions are not intended to apply to month-to-month contracts or to a contract that automatically converts to a monthly variable-priced agreement.  "From a general standpoint, providing thirty days notice of the renewal of a month-to-month contract would be impracticable to comply with.  Moreover, given that these contracts are terminable under thirty days notice anyway, the application of such notice requirement would be excessive and unnecessarily costly," NEM said.

The proposed Bill of Rights provide that customers will not be subject to early termination or cancellation fees if the customer objects to a renewal within three business days after receiving the first billing statement from the ESCO under the terms of the agreement as renewed.

NEM sought clarification that the customer's right to such no-fee termination during this period is limited to cases where there has been a material change in the contract, and the contract was renewed without the customer's express consent.  "Indeed, subsection 6 of GBL 349-d from which draft Section 5.b.l.d is derived, expressly applies to material changes in terms or duration of a contract," NEM said.  NEM offered language which would limit the no-fee cancellation period for renewals to those situations where the customer's express consent is required for renewal.

RESA, NEM, the Small Customer Marketer Coalition and the New York State Energy Marketers Coalition all sought clarification of the "prospective" customers to whom the Bill of Rights must be provided.  Noting that the term could apply to all customers within the state, and that many customers receiving solicitations do not become ESCO customers, suppliers generally said that the Bill of Rights should only be provided to customers prior to their execution of an ESCO sales agreement.

RESA further sought clarification of the Bill of Rights' applicability, as the proposal states that the rights shall apply to residential customers.  RESA said that the provisions should not apply to large commercial customers who take service through multiple rate classes, which may include residential meters (e.g. the president's house at a university, a church diocese with a residential dwelling, etc.).

RESA also asked that existing contracts be grandfathered from the new requirements.

   
Email This Story

HOME

Copyright 2010 Energy Choice Matters.  If you wish to share this story, please email or post the website link; unauthorized copying, retransmission, or republication prohibited.

 

Be Seen By Energy Professionals in Retail and Wholesale Marketing

Run Ads with Energy Choice Matters

Call Paul Ring

954-205-1738

 

 

 

 

 

Energy Choice
                            

Matters