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Pennsylvania PUC: Notifying Customer-Designated Third Party Of Retail Supplier Switch Would "Provide A Valuable And Important Consumer Protection", But PUC Declines To Adopt At This Time, Citing Unanswered Questions

PUC Rejects Proposed Supplier Consolidated Billing Changes Raised In Case

March 4, 2019

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

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The Pennsylvania PUC ultimately declined to implement a third-party customer switch notification in adopting amended utility customer protection rules (largely dealing with EDC matters, not the retail market)

However, one proposal proffered by the PUC earlier in the proceeding was creating a mechanism under which customer-designated third parties could be notified if the customer's supplier (including the default supplier) was switched, similar to billing and termination notices provided to third parties designated by the customer

The National Energy Marketers Association had filed comments during the proceeding, raising concerns that third-party notification of supplier switches poses logistical issues that are not readily apparent and that could lead to negative unintended consequences including consumer confusion and unwarranted consumer complaints. NEM suggested that, should the Commission pursue implementation of the third-party notification proposal, it should first convene stakeholders to review, discuss and resolve the logistical issues.

NEM had said that there is an important difference between the current third-party notice that is sent regarding collection activity as opposed to the proposed third-party notice of supplier switching activity. In the case of a third party’s receipt of notice of collection activity, if the third party receives the collection notice and responds by taking action and paying a past due balance on behalf of the customer, the net result is positive - the customer’s account is maintained and restored to good standing. Submission of the third-party payment does not require that the third party have previously been designated as having authority over the account. In contrast, under the proposal at issue, when a third-party notice is sent regarding supplier switching activity, a conceivable outcome is that the third party will seek to terminate the competitive supplier relationship, whether or not they are authorized to do so and permitted under the regulations. There is a large risk that the net result will not be positive. The third party may become upset and confused if they are unable to cancel the competitive supplier transaction and then lodge a complaint, notwithstanding that no party engaged in improper conduct. Additionally, the customer’s account with the supplier could be unjustifiably ended, the customer could lose the benefit of its contracted for products and services and perhaps incur an early termination fee if the rescission period has expired. The supplier may lose the customer and without having engaged in any improper conduct. In other words, the actions prompted by a third-party notice of collection activity versus third-party notice of supplier switching will yield significantly different outcomes for the customer that warrant serious consideration, NEM had said

In a final order, the PUC said that, "while we agree with OCA that our proposed revisions to §§ 56.131 and 56.361 would provide a valuable and important consumer protection, on balance we conclude that this is a proposal that would be best addressed in a different proceeding."

The PUC agreed that the logistics of the proposal have not been thoroughly vetted. "There are too many unanswered questions raised by the utilities and the suppliers, including the impact on utility customer databases, who could qualify for third-party status, and the ability of those third-parties to interfere with the supplier switching process. We are also persuaded by the comments of PECO, Duquesne, PEMC and NEM that supplier confirmation notices and utility collection notices are distinct, very different things and, while consumers may want to use third-party notification for one of these things, it is very possible they would not want to do both."

"We think this type of proposal is better vetted in a proceeding specifically addressing the electric supplier switching regulations in Chapter 57 and the natural gas supplier switching regulations at Chapter 59. This would allow parties and the Commission to consider third-party supplier confirmation notices in the proper context," the PUC said

The PUC also rejected proposed changes to the rules relating to supplier consolidated billing, citing a separate proceeding addressing SCB

"Given that SCB is now the subject of a separate, ongoing proceeding, we agree with LICRG, EAP, PPL, Duquesne and FirstEnergy that further consideration of it in this proceeding is neither appropriate nor necessary at this time. Addressing SCB in this Chapter 14 / Chapter 56 proceeding could give the appearance of inappropriately pre-judging the ongoing SCB proceeding at Docket No. M-2018-2645254," the PUC said

Docket L-2015-2508421

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