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Texas ALJ Would Grant Retail Provider A Good Cause Exception To TPV Requirement For Certain Door-to-Door Sales

December 9, 2015

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Reporting by Karen Abbott • kabbott@energychoicematters.com

A proposal for decision from a Texas ALJ would grant Accent Energy Texas, LP d/b/a IGS Energy a good cause exception to the recorded telephonic verification requirements otherwise required for door-to-door sales under 16 TAC § 25.474(f)(3) for IGS Energy's specific iPad-based in-home sales and enrollment process

As previously reported, IGS Energy had sought a good cause exception to the rule to allow customers solicited door-to-door the option of choosing a retail electric product via a hand-held electronic device without requiring the customer to participate in a recorded verification voice telephone call (be it TPV or conducted by the REP). Under IGS Energy's iPad-based door-to-door sales and enrollment process, the customer would verify their consent to the terms and conditions via their electronic signature that is captured as a digital image.

Click here for more specifics on the iPad-based IGS Energy enrollment process

The ALJ would conclude that, "The technology and procedures for the Proposed Process provide adequate protection for customers to allow a finding of good cause to permit Applicant to enroll customers without meeting the requirements of 16 TAC § 25.474(f)(3)."

The ALJ noted that the following processes and procedures that are part of IGS Energy's proposed mechanism, "provide adequate protection to the customer," and constitute good cause to except Applicant from the requirement of 25 TAC § 25.474(f)(3):

• the authorization disclosures made by IGS Energy via the internet on the iPad;

• the acknowledgement of their right to rescind made by the customer on the iPad;

• the verification of authorization made by IGS Energy via the internet on the iPad; and

• the confirmation email sent by IGS Energy to the customer after enrollment, which provides the terms of service and Your Rights as a Customer document, again notifies the customer of its right to rescind the terms of service, and offers the option of exercising that right by phone, email, website, fax, or regular mail.

"The verifications done through the internet as well as the confirmation email give the customer several opportunities to verify his or her authorization to enrollment in the services, both during the enrollment process and then in response to the email. Further, the customer is protected from an unauthorized enrollment by his or her decision to enter an email address and social security number during the Proposed Process. If the customer does not wish to enter the information, the Proposed Process will stop," the ALJ said

Staff of the Public Utility Commission of Texas had opposed the sought good cause exception, citing: (1) the inherent pressures and potential misunderstandings and confusion involved in door-to-door marketing; and (2) the possible undue influence that IGS's home energy consultants (sales reps) can place on potential customers during the enrollment process.

However, the ALJ would conclude that, "the record contains no evidence of any such pressure, confusion, or influence. However, a customer enrolling through the Proposed Process who felt pressured by the Consultant will be able to rescind his or her enrollment in one of many ways, all of which do not involve the Consultant who assisted with the enrollment."

The ALJ noted that the preliminary order in the case sought recommendations on procedures that would provide adequate protection for customers sufficient to find good cause to allow an exception to 16 TAC § 25.474(f)(3).

In response to this directive, the ALJ suggested that the PUCT could consider a verification phone call from IGS Energy to the customer after the sale, though the ALJ did not recommend such verification call as necessary

"[T]he Commission could consider requiring Applicant, as part of the Proposed Process, to have the customer indicate affirmatively whether they wish to receive a follow-up phone call from Applicant to verify the enrollment," the ALJ said

"However, based on the facts and reasoning set forth previously, the ALJ does not find that such a requirement is necessary," the ALJ said

Docket 44518

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