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PUC Requires Retail Suppliers To Provide Advance Notice For Expedited Return Of Mercantile Customers To Default Service, Addresses Costs Assigned To Retail Suppliers
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The PUC of Ohio has approved final rule language to implement recently adopted statutory language governing the expedited return of mercantile customers to electricity default service
R.C. 4928.105, under last year's HB 15, requires that utilities complete, within three business days, a request for a mercantile customer to be returned, on an expedited basis, to the standard service offer (SSO). The law allows the utilities to recover, through "reasonable" fees charged to retail electric suppliers, the administrative costs of processing such expedited return requests
PUCO's rule adds a notice requirement for such expedited mercantile customer returns
Rejecting concerns raised by the Retail Energy Supply Association about a notice requirement, PUCO approved rule language stating that a retail supplier "should" provide 7 calendar days' notice to the mercantile customer and the utility prior to submitting a certified request to the utility to return the mercantile customer to the SSO, "unless a different timeframe is agreed to between the parties in the voluntary service agreement that explicitly authorizes the expedited return."
While, as written, the rule language ostensibly suggests that 7-day notice to the utility is not required if, "a different timeframe is agreed to between the parties in the voluntary service agreement that explicitly authorizes the expedited return," PUCO's adoption order, which stresses that utilities are not parties to supplier-customer agreements, would suggest that the customer agreement could only be used to shorten the required notice to the customer, not the utility
PUCO found that the 7-day notice requirement does not conflict with the statute's provision that provides that drops must be completed in 3 business days
PUCO said that advance notice of the drop to the utility, "may assist EDUs in preparing to process expedited returns without delaying the statutory switching timeframe".
Rejecting proposals from certain utilities, PUCO maintained that the expedited drops shall occur within 3 business days, maintaining rule language stating that such deadline is, "regardless of billing cycle".
Several utilities had raised operational concerns and cited necessary upgrades and/or costs to allow for expedited returns in the middle of a billing cycle. The utilities instead proposed that expedited returns be completed at, "the earliest practicable date."
PUCO found that the Commission lacks authority to modify the statute's clear language requiring the expedited return to be completed within 3 business days
PUCO "recognizes" that utilities may require additional time to implement changes to allow for expedited returns regardless of billing cycle. PUCO said that utilities may seek a temporary waiver if supported by good cause
PUCO clarified the rule language to confirm that utilities are not to arbitrate whether a request from a retail supplier for an expedited drop of a mercantile customer to the SSO is permitted under the supply agreement between the mercantile customer and retail supplier
Utilities must process the request for an expedited return provided that a certified form (or EDI transaction) established by PUCO to be used for such transfers is complete, and that the customer is a mercantile customer
PUCO explained, "Under the adopted rules, an EDU’s responsibility is limited to verifying that the certified request is complete on its face and that the customer is a mercantile customer"
PUCO said, "EDUs do not have access to supplier–customer service agreements, do not participate in the customer’s enrollment with the supplier, and thus are not positioned to verify whether the agreement explicitly authorizes expedited return, whether that authorization was voluntarily entered into, or whether the supplier satisfied any notice requirement. Requiring EDUs to make such determinations would be both unworkable and inconsistent with the expedited timeframe established by statute."
PUCO will allow certified requests for expedited returns to be submitted either on a Commission-approved form or via an equivalent EDI transaction
Concerning cost recovery, PUCO declined to establish specific costs to be recovered by the utilities, stating that tariff applications are the appropriate venue for such considerations
Notably, PUCO will not require suppliers to pay upfront, at the time of the submission of the expedited return, any applicable charges assessed by the utility
The approved rule language provides that "reasonable fees" may be charged to retail suppliers, to be set forth in a utility's tariff
PUCO said that the application of the utilities for cost recovery tariffs would address what specific administrative costs are recoverable, how those costs are calculated, how resulting fees should be structured, and how such fees should be incorporated into each EDU’s tariff.
PUCO in its order clarified that the rule language, which also addresses other mercantile customer issues, does not authorize virtual net metering by mercantile customers
The approved rule language states, "An EDU cannot disallow mercantile customer self-power systems from providing electric
generation service to one or more mercantile customers in the EDU's service territory."
However, PUCO explained that in the context of statute and related definitions, this rule does not authorize virtual net metering, and PUCO declined to adopt, as unnecessary, additional language proposing an explicit prohibition on virtual net metering
PUCO also declined as unnecessary a change proposed by RESA to language stating that, "An EDU may charge a mercantile customer member for distribution, generation, or
transmission services used by the mercantile customer member."
RESA expressed concern that the term generation could be read as including behind-the-meter generation from the mercantile self-power system or standard billing for retail electric generation service
PUCO said that the reference to "generation" here, "reflects existing billing practices, including consolidated billing arrangements, and does not expand the scope of an EDU’s authority to charge for services beyond what is already permitted by statute or tariff," and thus PUCO declined any change in language
Under the customary rule adoption process, the new rules remain subject to review by the Joint Committee on Agency Rule Review.
Case 25-741-EL-ORD, 25-0741-EL-ORD
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March 18, 2026
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Copyright 2026 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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