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NEM Raises Concerns With Proposals That Would Place Utilities In "Policing" Function

February 18, 2019

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Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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In comments on a wide-ranging Massachusetts DPU proceeding on the retail electric market, the National Energy Marketers Association raised concerns with various proposals that would place the electric distribution companies in the role of policing the marketplace

EnergyChoiceMatters.com was first to report on the DPU's new retail market investigation. See our story here for the full details on issues being considered

Among other things, the DPU asked what supply product-related information, including renewal information, should the electric distribution companies be required to provide to competitive supply customers through the bills (e.g., early termination fees)

In response, NEM said in its comments that, "It is highly inappropriate to insert the utility, which is an active participant and competitor in the retail electric marketplace, in the role of policing the marketplace. Requiring an EDC to use their monthly bills to provide detailed information to customers about the terms of contracts that the customers have entered into with competitive suppliers would do just that. Of course the bill should disclose the rate the customer contracted for with the supplier. But requiring the posting of renewal dates and early termination fees from the competitive supply contract on the monthly utility bill is inappropriate. It may also be logistically challenging for utilities and suppliers to coordinate the sharing and updating of this information so that it is accurately presented. NEM also questions whether it would be technologically feasible using current EDI transactions to transmit this type of customer and contract specific information for inclusion on the utility’s monthly bill."

NEM did see a role in improving utility bills to better help customers identify their supplier and for expanded bill messaging from the supplier about the products and services the customer is receiving

NEM said in its comments that, "NEM agrees that EDC bills should be revised to aid customers in developing a stronger recognition of, and relationship with, his or her competitive supplier, and increase customer awareness when participating in the competitive retail electric market. Inclusion of the competitive supplier’s logo on the bill is necessary to reinforce to consumers that that the bill that they receive is collecting charges from two separate entities, for both the competitive commodity supply service as well as the utility delivery service."

NEM said in its comments that, "Requiring a separate bill page dedicated to the competitive supply component of customer’s electric service would certainly enhance consumer understanding that the bill includes charges from two separate entities for different products. It would also enhance supplier’s ability to provide more detailed messaging about the products and services the customer has contracted for and thereby strengthen the supplier-consumer relationship. At a minimum, the Department should consider requiring that the utility bills include additional supplier line items and bill messaging space. Providing additional line items will facilitate the provision of increased value-added services to consumers such as energy efficiency products, rebates, discounts, and the like. Suppliers would be better able to provide consumers with innovative products if they had additional billing line items for their presentation."

NEM also supported introduction of a supplier consolidated billing option

NEM raised concerns about a proposed "Do Not Switch" list

"The concept of a utility-established 'do not switch' list is concerning. There are a number of important issues associated with allowing such lists that should be considered. First among these issues is the appropriateness of instituting the utility (the incumbent and dominant provider) as the keeper of the list in a competitive marketplace. Related to this is the need for rules regarding how the utility may inform consumers in a competitively neutral fashion about the existence of the list, what constitutes consent for the consumer to be on the list, how long will a consumer be kept on the list, and the implementation and on-going costs to the utility of maintaining the list. NEM is concerned that a 'do not switch' list, in concert with telemarketing sales restrictions, could drastically limit the availability of effective sales channels without first having made a requisite finding that such a restriction is necessary to protect consumers," NEM said in its comments

"From a practical perspective, implementation of a 'do not switch' list may lead to the unintended creation of consumer confusion and dissatisfaction. For example, a consumer may forget that they previously joined the list and then subsequently decide to shop for a competitive supplier. The customer’s enrollment would be rejected under those circumstances even though the consumer sought to enroll with the competitive provider. The underlying goal of this proposal is that consumers should not be enrolled without their authorization, i.e., competitive suppliers should not be slamming consumers. That goal can be achieved through marketing standards that require the consumer’s affirmative consent, rather than the implementation of a 'do not switch' list," NEM said in its comments

"A uniform requirement for the utilities to provide an enrollment notice to the customer, subject to the rescission period, would be consistent with the approach taken in other jurisdictions and would more appropriately achieve the presumed goal of a 'do not switch' list. This approach would ensure that the switching process is controlled by the customer," NEM said in its comments

Docket D.P.U. 19-07

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