PSC Issues Draft Rules For Retail Suppliers To Serve Energy Assistance Customers Only Under PSC-Approved Offer

Draft Would Require Affirmative Consent For A Supplier To Keep An Existing Customer, Who Becomes An Energy Assistance Customer Mid-Contract, Under A Compliant Product

Draft Addresses How Calculate Default Service Rate For Comparison, When Suppliers Must Match Or Beat SOS

September 2, 2022

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Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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The Maryland PSC has issued draft regulations to implement a 2021 law [Chapter 637; amending the annotated code Section 4-308] that prohibits retail electric and gas supplier service to energy assistance customers outside of a PSC-approved plan that is less than SOS

The Commission initiated RM 78 to consider the draft rules while also issuing direction on certain other items outside of the rulemaking, including the submission of proposals for compliant supplier offers. The PSC issued substantially similar draft rules for electricity and gas (with minor differences reflecting terminology and other provisions unique to each industry); this story quotes only the electric draft rules for brevity

As previously reported, Section 4-308(b)(1) of the Public Utilities Article states that, beginning on July 1, 2023, unless the Commission has approved a supply offer from the supplier, a third-party retail supplier may not offer to:

• provide electricity or gas to households in the State that have received energy assistance during the previous fiscal year;

• renew a contract to provide electricity or gas to households in the State that are enrolled in an energy assistance program; or

• charge a termination fee to households in the State that have received energy assistance during the previous fiscal year.

Section 4-308(b)(2) also requires that, "[a]n approved supply offer from a third-party retail supplier shall include a commitment, for the entirety of the term of the supply offer, to charging at or below the standard offer service rate or gas commodity rate for customers receiving energy assistance."

Notably, the draft rules would define the term "Energy Assistance Household" to mean that the state's Office of Home Energy Programs found that the service address associated with the utility account qualified for an energy assistance program during the, "current or previous fiscal year."

The Office of People's Counsel had raised concerns that, due to the use of the language "previous fiscal year" in the statute, implementation, barring clarification via rulemaking, could lead to some current energy assistance households not being covered by the statute's protections, since such households may have only begun receiving energy assistance after the end of the previous fiscal year. As noted, the draft rule addresses this by using the phrase "current or previous fiscal year" in the definition of Energy Assistance Household

Under the draft, fiscal year means the 12 month period between July 1 and June 30 of the following calendar year.

Under the draft rules, an electricity supplier may not serve a customer in an energy assistance household (as defined by the rule) except pursuant to a Commission-approved contract for energy assistance households, with suppliers required to file an application with the PSC for approval of any compliant contract

The draft rule would require that an application for approval of a contract for energy assistance households shall, among other things, include a description of the price a customer will pay, as it will appear on the customer contract, and, for any months where the utility standard offer service rate is not known at the time of the application, a description of how the supplier will ensure that the contract for energy assistance households remains at or below the utility standard offer service rate

All energy assistance household contracts shall include a commitment for the entirety of the term of the supply contract to charge at or below the utility standard offer service rate, the draft rules state

Concerning pricing for PSC-approved offers for energy assistance households, the proposed regulations provide:

(1) A contract for energy assistance households must guarantee service at rates at or below the utility’s SOS rate for each month of the entirety of the term of the supply contract.

(2) The standard offer service rate is the rate listed in the utility’s standard offer service tariff.

(a) This rate does not need to account for out of period adjustments;

(b) For billing periods which extend over more than one SOS rate[,] the rate for comparison will be the weighted average based on the number of days on each SOS rate; and

(c) The retail supplier’s rate for comparison will include all commodity charges, including fixed charges divided by the kWh consumed.

The draft rules include the following provisions to address situations in which a customer starts to receive energy assistance while already receiving service from a retail supplier:

(1) When a utility determines that a supplier’s existing customer is newly identified as an energy assistance household, the utility shall within 3 business days provide the supplier notice of that determination.

(2) If the supplier has a Commission approved contract for energy assistance households:

(a) Within 3 business days of receiving the utility notice, the supplier shall provide a cancellation notice to the customer pursuant to COMAR 20.53.07.10;

(b) As part of the cancellation notice, the supplier may include a solicitation for the customer to enroll in a Commission approved contract for energy assistance households;

(b) [sic] Within 15 business days of receiving the utility notice, the supplier shall drop the customer unless the supplier receives the customer’s consent to receive service under a Commission approved contract for energy assistance households and notifies the utility of the new enrollment; and

(d) If the utility does not receive either notice of a new enrollment to a Commission approved contract for energy assistance households or a drop transaction within 21 business days of providing notice to the supplier, the utility shall drop the customer from the supplier and enroll them onto SOS.

(3) If the supplier does not have a Commission approved contract for energy assistance customers:

(a) Within 3 business days of receiving the utility notice, provide a cancellation notice to the customer pursuant to COMAR 20.53.07.10; and

(b) If the utility does not receive a drop transaction within 3 business days of providing notice to the supplier, the utility shall drop the customer from the supplier and enroll them onto SOS.

Concerning the above-cited drop notice under COMAR 20.53.07.10, the draft rules provide that a supplier may specifically include in the notice:

(a) The Commission approved contract for energy assistance households, including the contract summary, all terms and conditions; and

(b) Instructions for the customer to provide consent to receive service under the Commission approved energy assistance household contract

The draft rules provide that a supplier, "must make reasonable efforts to determine whether a customer lives in an energy assistance household during solicitations."

A customer's Energy Assistance Household status would be included in the pre-enrollment information available to suppliers from utilities, under the draft

The PSC will hold a rulemaking session on October 27

In an order with directives independent of the draft rules, the PSC said that applications from suppliers for approval of a contract for energy assistance households may be filed (in proceeding PC 55) beginning January 1, 2023.

"With a single location to review and inventory all potential contracts for energy assistance households stakeholders will have a central location to easily access all Commission-approved supply offers. The Commission will schedule hearings on applications as part of its weekly administrative meetings," the PSC said

The Commission directed the EDI and XML working groups to develop communication capabilities that would allow a utility to provide updated energy assistance household status to suppliers for their existing customers. If this capability cannot be developed before March 1, 2023 the Commission directed each utility with customers participating in retail supply to begin providing each retail supplier servicing customers within the utility’s service area a list of any enrolled customers of that supplier meeting the regulatory definition of energy assistance household starting April 1, 2023, and provide an updated list every 30 days thereafter until the capability is functional.

The Commission also directed the Competitive Markets and Customer Choice working group to file with the Commission a proposed customer communications plan for informing existing and future retail supply customers impacted by the statute about coming changes. The plan should cover proposed communications changes by utilities and suppliers, and changes to the Commission’s website, the PSC said

RM78

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