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PSC Proposes New Retail Supplier Regulations, Would Require "Customer Consent Form" For All Contracts

Would Require Suppliers To Post "Adequate" Rate, Service Info For Residential And Small Commercial Offers Online

Would Limit Retail Licenses To Five Years

June 28, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The District of Columbia PSC recently issued proposed new rules governing natural gas supplier licensing which includes the definition for a new term: "Customer Consent Form."

Customer Consent Form is proposed to be defined as follows: "Means by which a customer can enroll with a Natural Gas Supplier. The Customer Consent Form must be executed by a residential customer, and received by a Natural Gas Supplier, for an enrollment transaction to be valid. Natural Gas Suppliers are required to maintain the customer consent forms for the duration of the contract. Upon request by the Company or the Commission, the Natural Gas Supplier is required to provide a copy of the consent form. If the supplier cannot provide a copy of the consent form, then the customer will be returned to sales service or back to their alternative Natural Gas Supplier. The Commission has the authority to institute, at any time, a requirement that the Natural Gas Supplier continuously provide the Commission with copies of each of its consent forms. The Commission will make such a determination on a case-by-case basis, if it finds just cause and if it determines that such a requirement is in the best interest of consumers."

Notably, the definition does not use the term "written," and instead uses the term, "means," and it is possible the definition is intended to include all forms of customer consent for enrollment currently authorized under a separate chapter of the D.C. regulations (15 D.C.M.R. § 327, which the PSC recently affirmed only requires a written signature for written contracts, with telesales permitted to be authorized via TPV and internet sales via electronic signature).

However, it is also notable that the PSC's concurrent electric supplier rulemaking (RM46-2015-01-E) does not contain the term, or a definition for, "Customer Consent Form." Indeed, the term Customer Consent Form only appears in the "definitions" section of the proposed natural gas rules and in no other sections. It is unclear for what purpose its inclusion is intended, other than to codify the period of time for which suppliers must maintain such Customer Consent Form and PSC's ability to request copies of the Customer Consent Form

The rules would provide that "Natural Gas Suppliers" must receive a license in order to operate in the District.

More specifically, the proposal states, "Natural Gas Suppliers include marketers, brokers, aggregators, any entities selling natural gas at retail and any entities selling competitive billing services."

Additionally, the proposed rules include the following definitions:

Broker: "A person who acts as an agent or intermediary in the sale and purchase of natural gas but who does not take title to natural gas."

Natural Gas Supplier: "A licensed person, broker, or marketer, who generates natural gas; sells natural gas; or purchases, brokers, arranges or markets natural gas for sale to customers."

Nontraditional Marketers: "A community-based organization, civic, fraternal or business association that works with a licensed Natural Gas Supplier as agent to market natural gas to its members or constituents. A Nontraditional Marketer: (i) conducts its transactions through a licensed Natural Gas Supplier; (ii) does not collect revenue directly from retail customers; (iii) does not require its members or constituents to obtain its natural gas through the Nontraditional Marketer or a specific licensed Natural Gas Supplier; and (iv) is not responsible for the payment of the costs of the natural gas to its suppliers or producers."

Other than defining the term "Nontraditional Marketers", the rules do not explicitly address whether Nontraditional Marketers fall within the definition of natural gas supplier, though presumably the intent of including a specific definition is to exclude them from licensure.

Also notable is language stating that, "Failure to post on the Internet adequate and accurate information about its services and rates for Small Commercial Customers and Residential Customers," would be grounds for the PSC to take action against a natural gas supplier.

Other notable provisions of the proposed rules include that a natural gas supplier license is valid until the expiration date of five years after issuance

A natural gas supplier license would also not be transferable without the prior approval of the Commission. The Commission would give public notice of any transfer application

The proposed rules provide that, "A Licensee who has not initially started serving customers shall notify the Commission within seven (7) days the Licensee begins soliciting or marketing to Customers directly or through an authorized representative in the District of Columbia."

Furthermore, the proposal provides, "A Licensee shall do the following before it begins to serve customers in the District of Columbia: (a) notify the Commission within sixty (60) days of the date when it will begin to serve customers in the District of Columbia; and (b) file an affidavit attesting that all sales and marketing and regulatory personnel have read the relevant provisions of Chapters 3 and 47 of Title 15 DCMR before they begin soliciting customers in the District of Columbia."

For compliance purposes regarding electronic solicitation on the licensee's website, suppliers would be required to provide the Commission with, "the electronic accessibility necessary to monitor the Licensee's compliance with [internet marketing/enrollment rules]."

RM47-2017-01-G

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