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Update: Here Are The Variable Rate Disclosure Requirements Proposed In Illinois, Including Separate "Written" Notice for Increases Greater Than 20%

September 26, 2016

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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

EnergyChoiceMatters.com was first to report last week that the Illinois Commerce Commission is proposing in a first notice order that retail electric suppliers notify customers, via a separate notice, of an increase in a variable rate that is in excess of 20%. The written first notice is now available, and specifics concerning variable rate disclosure are detailed below.

Adoption of a first notice order means the ICC will now submit the revisions to 83 Ill. Adm. Code 412 and 83 Ill. Adm. Code 453 to the Secretary of State to begin the first notice period required for rulemakings. The ICC will have to vote on the rules again before they are final.

Under the proposed rules, "variable rate" means the charge for electric service changes at any time during the term of the contract.

First, at least 30 days prior to the start of a calendar month, each RES [retail electric supplier] shall make available on its website, or through the customer’s account log in, the variable rate(s) for its residential customers applicable for the billing cycle starting during that calendar month. If the billing cycle does not match the calendar month, the dates that the rates will be in effect must disclose the one month period to which the rates will apply. In addition, each RES shall provide such rate information to its variable rate customers who request it through the RES’s toll-free number. The customer’s contract shall contain the website address and toll-free phone number for the customer to obtain variable rate information in accordance with this section.

If the RES uses the utility’s single bill pursuant to Section 16-118(d) of the Act to bill its residential variable rate customers, the RES shall use the allotted space on the bill to disclose the customer’s variable rate that is in effect at the time the bill is received by the customer and the percentage change, if any, of the variable rate from one monthly billing period to the next. Where there is insufficient available allotted space on the bill for the RES to make such disclosures each month, the RES shall ensure that no residential variable rate customer receives consecutive monthly bills which fail to disclose upcoming variable rates in the bill’s message section. If the RES bills its residential variable rate customers directly, the RES shall ensure that those customers’ bills always contain the variable rate information described in this section. If the electric utility’s implementation of Section 16-118(d) prevents a RES from complying with this section, the RES shall be required to include a bill message that contains the toll-free phone number and/or website address where the variable rate information can be obtained by the customer. The requirements of this subsection to provide notifications in customer bills do not apply if the RES sends the notifications required by this subsection via a written communication sent at the same time as the customer’s monthly bill

If a residential variable rate customer’s rate increases by more than 20% from one monthly billing period to the next, the RES shall send a separate written notice to the customer, informing the customer of the upcoming rate change.

The rules would define "written" or "writing" as meaning a hard copy. Where the rules require information to be "written" or in "writing", an electronic copy would satisfy that requirement, so long as both RES and customer have agreed to electronic communication.

In discussing this allowance for electronic copies of variable rate notices, the ICC said, "the Commission agrees with Staff that the definition of 'written' includes email or text messages. Therefore, the attached rule allows RESs to use any form of communication authorized by the customer (e.g., email or text messages), which may be less costly."

The RES shall provide sufficient information on their website to identify the inputs to the formula used to calculate the variable rate, including the timing and location of the index or benchmark price, if any, and any other information necessary to calculate the rate.

Suppliers that currently enrolls residential customers on a variable rate for three consecutive months in any electric utility’s service must, for a variable price product, disclose on the RES's website and through a toll-free number the one year price history, or history for the life of the product, if it has been offered less than one year. A RES shall not rename a product in order to avoid disclosure of price history.

The provisions described above would only apply to residential and small commercial customers (under 15,000 kWh annually)

Docket 15-0512

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