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Texas ABC Seeks PUC Rule To Prohibit REPs From Not Accepting Customers Through Brokers

Seeks Disclosure Of Broker Fees On Customer Bills

Seeks Rule Change To Extend Minimum Due Date For REP Bills

Would Allow Broker To Meet Definition Of "Applicant" For REP Service On Behalf Of Customers, Implicating Disclosures, Etc.

January 5, 2022

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Copyright 2010-21
Reporting by Paul Ring •

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Thigbe LLC proposed that the Texas PUC adopt rules that would prohibit retail electric providers from taking various actions to prohibit customer enrollments through brokers

Thigbe's comments came in a periodic review proceeding of the electric substantive rules. Some of Thigbe's comments cited portions of the substantive rules applicable to electric utilities but its comments made clear it was seeking the change for the competitive retail market.

Thigbe proposed changing the current anti-discrimination rule to further provide that no retail electric provider or broker shall discriminate on the basis of, "the way in which a customer accesses the market."

"Today, residential customers that choose to utilize the services of a broker or concierge broker service to facilitate their power contracts are at a decided disadvantage. They are being actively discriminated against by REP’s who look for and block registered Brokers from signing customers up on their websites or over the phone for the supplier’s most competitive rates offered on Power to Choose or, in several cases, blocking them from signing up for any rate offered. These customers, therefore, do not have the same contracting opportunities as other customers," Thigbe said

"In a well-functioning, transparent market, any customer should be able to purchase power from a supplier at the rates publicly offered by the supplier to serve similar loads in the customer’s area. That is not happening today and should be addressed directly as part of the rule changes that will come from this review," Thigbe said

Thigbe also proposed that the rule listing the grounds which are insufficient reasons for a REP to refuse service to a customer also include language stating that the following is not a sufficient reason for refusal of service by a REP: "The customer is represented by a registered broker or other authorized representative. This shall include blocking the representative’s ability to see offers or apply for service based on any IP or similar online filtering or blocking of signups based on billing address used or phone number used or similar criteria when the broker has reached out to the supplier previously and provided information such that the supplier knows the IP address and/or other identifying information comes from the registered broker."

Thigbe offered further thoughts on addressing discrimination in the rule: "Should discrimination be defined in this section? Something simple like not offering the same level of service, service offerings and other opportunities to one customer that are afforded to other customers of the same type. Note that this still allows contracts, and therefore pricing, to be different for different customers but it makes sure that any offer generally available to residential customers would be available to all residential customers."

Thigbe proposed that REPs be required to disclose broker fees paid by the supplier on the customer's bill

"If a broker is being paid by the supplier then those fees should be broken out on the customer’s invoice so that customers can determine whether or not the broker is providing adequate value for their fee," Thigbe said

Thigbe proposed that the earliest due date for REP bills be extended from the current 16 days

"The minimum bill due date should be adjusted for customers that receive paper bills due to the fact that the postal service is now offering slower service than they were 20 years ago. Note that a customer being willing to agree to only receive electronic communications should allow the supplier to have a lower minimum days to pay and suppliers should be able to offer lower rates for customers that agree to lower minimum payment terms or all electronic communications," Thigbe said

Further, Thigbe proposed striking for the current aggregator rule the provision that aggregators may, "not accept any money associated with payment or prepayment for electric service, as distinguished from aggregation services, unless it does so under contract with a REP, consistent with any rules adopted by the commission relating to customer billing as an independent billing agent for a REP."

"Residential and small commercial customers are more and more relying on concierge broker services to manage their utility contracts and, in many cases, their utility bills. There is no reason to prohibit this activity just because the broker is trying to add additional value for its customers by aggregating them into an aggregation group," Thigbe said

Thigbe proposed that the definition of "applicant" in the rule should be expanded to include the applicant’s representative.

"Today it is very difficult for registered brokers to work with utilities and REP’s as a customer’s representative. Given that Brokers are registered with the PUC and are subject to many of the same customer protection rules and violation penalties as REP’s and utilities, they should not have to provide and undue proof of their authorization to act on the customer’s behalf," Thigbe said

Thigbe proposed that the definition for applicant include language stating that, "Applicant may also be an authorized representative of the customer that is either a registered broker that claims to have authority from the customer to work on their behalf with regards to the application or service request or is an un-registered representative that can present documentation signed by the customers authorizing them to act on the customer’s behalf."

"Additionally, as required in this chapter, the definition of Customer should also be similarly amended to address concerns by some suppliers that, when they send contract TOS and EFL and renewal notices to the customer’s appointed agent they are not meeting the PUC’s requirement to send said items to the Customer," Thigbe said

Thigbe proposed that there should not be separate registrations for aggregators and brokers, and that, for registration purposes, aggregators should be a subset of brokers

"Aggregators should be come [sic] a subset of brokers. All aggregators are brokers almost by definition. Hence, it just creates confusion to have two sets of rules. Current aggregators, who are also required to be registered as brokers, should be automatically included in that broker subset and future registrants should be able to check a box as to whether or not they intend to provide aggregation services as a broker," Thigbe said


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