|
|
|
|
|
State Approves Retail Energy Switch Block Mechanism
The following story is brought free of charge to readers by VertexOne, the exclusive EDI provider of EnergyChoiceMatters.com
The New Jersey BPU approved a switch block mechanism as part of adopting new and modified rules governing retail electric and natural gas marketing and licensing
Written final rules were not immediately available, but Staff, in presenting a final order to the BPU, said that there were only 3 changes in the final order from the proposed rules, and Staff described each. This story is written on the representation that the final rules do not include any further changes from the proposed rules other than what Staff described, and will be updated as needed if the final published rules reflect additional changes
All rules discussed in this story apply to all customer classes unless specifically noted otherwise, and apply to both electricity and gas
The new rules require implementation of a switch block, called a "preferred supplier freeze", under which a customer may direct their utility to block any future switch from one energy supplier to another supplier (including to and from default service) until the customer lifts the block
Notably, a municipal aggregation would not be permitted to enroll, on an opt-out basis, any customer with a switch block
The switch block shall be implemented within 12 months (a change from an earlier proposed 6-month implementation period)
The rules provide that a customer's election or removal of a switch block may not be executed under the influence of a retail supplier (third party supplier, or TPS) or a TPS's agent. Retail suppliers and supplier agents are not permitted to request election or removal of the switch block on behalf of a customer
To add or remove a switch block, the utility must obtain the customer's consent, in the manner described below, and must confirm the customer’s name, address, and account number
For customer consent to add or remove a switch block, the utility must either (1) obtain the customer’s written or electronically
signed authorization, or (2) obtain the customer’s verbal authorization
stating the customer’s intent to add or remove a switch block. For verbal authorization, the utility shall use the same methods that the utility
presently uses to verify that an individual is the customer of record
or is authorized to make changes to the utility account
The rules specifically note that a customer's authorization to add or remove a switch block does not constitute authorization for a switch. Separate authorization for a switch must still be obtained in the manner prescribed by the retail market rules
As demonstrated by the requirements to remove a switch block described above (which is obtained by the utility), customer authorization to a retail supplier for a switch may not be used to remove a switch block
Notably, the switch block does not apply if a retail supplier has "merged" with, or has had its customers "assumed by", another retail supplier. A customer's switch block is temporarily lifted in such circumstance for the relevant transaction, but the switch block otherwise remains in force going forward
Additionally, in the case of a retail supplier being unable to continue service to customers, the switch block is removed, and customers are returned to default service. Notably, in such case, the switch block is removed completely (and the customer is informed of such), and the switch block does not continue once the customer is moved to default service
The rules mandate that retail suppliers shall not
offer different rates or services to a customer based on whether or not
the customer elects to implement a
switch block
The new rules also add provisions governing notice of fixed price expiration
For any contract that has a fixed price "element" (including contracts with both fixed and variable price elements), the retail supplier must provide notice to the customer at least 30 days prior to expiration of the fixed price element
For a fixed contract that defaults to a variable rate at expiration, the expiration notice shall provide, "an explanation of the difference between a
fixed rate and a variable rate that is easily understandable by the
general public."
Additionally, for residential customers with a retail contract that
contains fixed, variable, or both fixed and variable rate elements, the supplier shall include the historical variable rate billed by the supplier for the
three preceding months. When no historical data exists, the supplier shall
state that no historical data is available
Similarly, for the current contract summaries required from retail suppliers, the contract summaries, for residential customers only, shall include historical variable rates billed by the supplier for the three preceding
months. When no historical data exists, the supplier shall state that no
historical data is available.
Notably, the language requiring the disclosure of variable rate history in residential contract summaries is not limited to variable rate contracts, and would apply to all contracts, including fixed rates (regardless of whether the contract includes a variable auto-renewal)
The rules grant explicit authority for BPU Staff to direct a retail supplier to cease marketing or advertising "practices" for up to 60 days based upon a "determination" that the supplier has violated the state's retail energy rules
The rules grant explicit authority for BPU Staff to request retail supplier marketing and advertising materials
The new rules also include reporting and refund requirements relating to retail supplier "billing errors", with the final rules changing the threshold for the applicability versus an earlier proposal
For suppliers with "less than" 60 customers (BPU Staff's description), the threshold for the billing error provisions described below is when a supplier incorrectly bills 15 or more of its customers over a 30 day period
For suppliers with "more than" 60 customers (BPU Staff's description; it was unclear from Staff's description in which category a supplier with exactly 60 customers falls), the threshold for the billing error provisions described below is when a supplier incorrectly bills either (1) 25% of its customer base over a 30 day period or (2) 100 or more customers over a 30 day period
The rule language applies the billing error rules, "When a TPS becomes aware of an incident that causes the TPS
to incorrectly bill..."
Once a relevant threshold is met, the supplier must report the billing error to the BPU, including remediation plans
The rules require that, "A TPS shall pay a residential customer interest at the rate
provided for at N.J.A.C. 14:3-3.5(d) on any overpayment made by the
customer due to a billing error, unless the overpayment is fully
refunded or credited to the customer’s account within two billing
cycles after the billing error first appeared on the customer bill. The
period of time constituting two billing cycles shall be determined by
the billing practices of the public utility in place at the time the TPS
becomes aware of the error. In no event shall such period be
considered to be less than 60 days."
Note that this interest provision is not explicit that it applies only to billing errors caused by a TPS's actions (the language is not limited to when a, "TPS ... incorrectly bill[s]"
The rules adopt new supplier licensing fees, and also clarify the use retail supplier and broker security, without changing the level of required security
Specifically, the rules are now explicit that a supplier's (or broker's) bond shall insure against a licensee's failure to pay taxes or failure to meet, "contractual commitments to customers to deliver
electric generation service or gas supply service."
Additionally, for suppliers and brokers, a bond shall only be returned to a licensee when a licensee has demonstrated that the licensee has no outstanding state tax obligation, and if there are no outstanding New Jersey consumer complaints or
investigations against the licensee
For supplier license applications, the application fee is now $350 for electric, and $350 for gas (up from $250 for each)
An application fee for an Energy Agent, Private
Aggregator, and/or Energy
Consultant registration is now $750, up from $500
New Jersey also has a separate initial license fee charged upfront at the initial application (and refunded if a license is not granted)
This separate initial license fee is now $1,500 for electric suppliers (up from $1,000), and $1,200 for gas suppliers (up from $800) [there is no charge for brokers]
The annual information license update fee is now $750 for electric suppliers (up from $500), $600 for gas suppliers (up from $400) and $300 for an Energy Agent, Private
Aggregator, and/or Energy
Consultant (up from $200)
The rules also create a mechanism in which an opt-out government aggregation may, prior to selecting a retail supplier (and thus before rates are known), communicate information concerning the ability to opt-out. Opt-out enrollment would only apply to residential customers, and would exclude currently shopping customers or customers with a switch block
The utility would be responsible for notifying customers of the opt-out information under this new form of CCA, and for recording opt-out requests
The traditional form of CCA (in which opt-out information is provided after supplier rates are known, with customer communication conducted by the CCA or its agent) remains as an option. For this CCA form, opt-out enrollment would only apply to residential customers, and would exclude currently shopping customers or customers with a switch block
Docket EX25040201
ADVERTISEMENT Copyright 2026 EnergyChoiceMatters.com. Unauthorized copying, retransmission, or republication
prohibited. You are not permitted to copy any work or text of EnergyChoiceMatters.com without the separate and express written consent of EnergyChoiceMatters.com
New Disclosures Required, New Fees For Suppliers
Rules Allow Provision Of Opt-out Info For Muni Aggregation To Occur Prior To Selection Of Supplier, Rates
August 12, 2026
Email This Story
Copyright 2026 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
NEW Jobs on RetailEnergyJobs.com:
• NEW -- Enrollment & Rate Management Director - Retail Supplier
• NEW -- Strategic Sales Channels Manager - Retail Supplier
• NEW -- Controller - Retail Provider
• NEW -- Manager, Product I - VXRetail (Retail Energy)
• Refreshed 5/27/26 -- Manager, ISO Coordination (electricity), Retail Supplier
|
|
|
|
|