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Update:
Delaware Gov. Says, "Delawareans Should Not Have To Choose Between Consumer Protection And Consumer Choice," In Vetoing Rate Cap Bill
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Delaware Governor Matt Meyer issued the following statement in vetoing HB 393, which included limitations on retail electric supplier rates to residential customers (original story with full details below)
"Delawareans should not have to choose between consumer protection and consumer choice," Meyer said
"We can
crack down on deceptive and predatory energy sales without strengthening Delmarva's monopoly by
driving competitors out of the market," Meyer said
Chris Ercoli, President and CEO of the Retail Energy Advancement League (REAL), issued the following statement in response to the veto of HB 393
"Governor Meyer recognized that Delaware does not have to choose between protecting consumers and preserving their ability to choose. We appreciate his willingness to look at the experience in Maryland and recognize the unintended consequences that overly restrictive policies can have on competition. REAL supports strong, enforceable consumer protections that don't harm the choices and benefits customers receive. We look forward to industry working with the Governor, the Public Service Commission and other stakeholders on an approach that protects consumers without eliminating the competitive options available to them,"
--- Statement from Chris Ercoli, President and CEO of the Retail Energy Advancement League (REAL)
Gov. Meyer said that HB 393 would have effectively banned retail electric suppliers from offering more flexibility to consumers
through products like multi-year fixed rate plans, due to a price cap tied to the SOS rate (as described in our earlier story below).
Meyer emphasized the benefits of fixed rates, stating, "Functionally, this concept mirrors the choice landlords and tenants make when offering a 12-month
lease term at a higher monthly rate versus a multiple year lease term at a lower monthly rate. The
landlord is accepting a lower potential profit for increased stability, while the tenant is committing to
stay longer for protection from rent hikes. Importantly, these are choices consumers are free to make,
and companies are free to offer on the open market. For the energy market this choice means the
most to vulnerable Delawareans, like seniors on fixed incomes or families living paycheck to paycheck,
who increasingly have to make hard decisions about which bills get paid when excessive electric bills
bust their monthly budget".
Meyer noted that, in Maryland, the number of residential electric customers on retail supply essentially reached zero after Maryland adopted price caps and other reforms
"Delaware should learn from their [Maryland's]
experience, not repeat it," Meyer said
Meyer requested that the Delaware PSC adopt "similar" protections to those in HB 393 (excluding the price cap), specifically seeking PSC adoption of:
• enrollment
and renewal notice requirements
• limits on automatic and variable-rate renewals
• limiting sales
commissions
• a prohibition on early-termination and other supplier fees.
As previously reported by ECM, the PSC did recently adopt new notice and renewal requirements (full details here)
In requesting PSC adoption of protections similar to the non-cap provisions of HB 393, Meyer specifically said that HB 393 would not have impacted commercial customers
"Delaware consumers who choose to purchase electricity supply from a third-party electric supplier
rather than through Delmarva, Delaware's standard offer service provider, should be able to without
overregulation from government making the choice for them. It is critical that through our efforts to
regulate Delmarva and increase energy affordability we do not lose sight of the Delawareans and
families that need us most to look out for them-the people, families who we know are most affected
by rate hikes and soaring bills deserve both protection and a genuine choice among competitive
products," Meyer said
EnergyChoiceMatters generally understands that the legislature lacks the ability to hold an override vote absent the convening of a special session (as noted in the constitutional provision noted in ECM's prior story), with political observers seeing a special session as unlikely (or unlikely that any such session would specifically take up HB 393)
Earlier:
Delaware Governor Matt Meyer has vetoed HB 393 which included limitations on retail electric supplier rates to residential customers, but notably included an ambiguous qualifier
HB 393 passed both houses without opposition (zero No votes)
It was not immediately clear if the legislature has the opportunity to override the veto.
To the extent the legislature adjourned sine die on June 30, 2026, it would appear that the legislature no longer has the ability to conduct an override vote
However, as noted on legis.delaware.gov “Adjournment sine die” has been, "informally replaced by 'recess to the call of the chair'"
The Delaware constitution provides as follows concerning legislative sessions: "each session may not extend beyond 5:00 p.m. on the last day of June unless the session is recalled by the Governor or the mutual call of the presiding officers of both House".
Specifically, HB 393 provided that, "A third-party electric supplier that purchases electricity on the open market and sells it to a residential customer," [emphasis added] must comply with the price cap and other provisions below
The term "open market" is not defined in the bill
To the extent the retail supplier is purchasing electricity on the open market and selling it to residential customers, the supplier would have had to comply with the following:
• A residential rate, other than for "renewable energy", may not exceed the trailing 12-month average SOS rate as of the date of the agreement with the customer. The term "renewable energy" is not defined in the bill, nor does the bill specify any percentage of renewable energy that a product must contain to be exempt from the price cap
• A residential plan may not have a term longer than 12 months
• A retail supplier may not auto-renew a residential renewable energy plan (auto-renewals are also prohibited for non-renewable plans for both residential and small commercial customers, discussed further below)
• A retail supplier may not offer a residential variable rate, "other than a rate that adjusts for seasonal variation more than [sic] twice in a single year". This prohibition does not apply to time of use rates
• A retail supplier may not pay a commission or other incentive-based compensation to an energy salesperson for enrolling residential customers
• For residential customers, a retail supplier may not charge early termination, cancellation, or non-renewal fees; late fees; fees to access the electric supplier's services; minimum monthly charges; enrollment fees; and interest charges
HB 393 would have required that, for any changes to the customer’s rate, a retail supplier must provide "written" notification at least 15 days in advance of the change. This provision is not limited to residential customers.
Such written notice, "must be distributed in the same format that the customer has elected to receive other notifications from the electric supplier".
Concerning renewals, HB 393 would have required, for residential and small commercial customers, 90- and 30-day renewal notices, with the supplier only permitted to renew the customer if, "the customer agrees to renew in writing as evidenced by written or electronic signature."
Although not explicit, such provision [which uses the present tense "agrees"] appeared to require that such agreement in writing to renew must be in response to the renewal notices, rather than an agreement made at the time of the original enrollment to auto-renew.
The bill defined "small commercial customer" as a customer taking service under the Delmarva "small general service non-demand rate" tariff or the Delaware Electric Cooperative "general service" tariff
The "written" renewal notices, "must be distributed in the same format that the customer has elected to receive other notifications from the electric supplier," the bill provided
HB 393 also required that an electric supplier must provide written confirmation of enrollment within 15 business days of enrollment.
HB 393 included various reporting requirements for supplier average rates, total amounts charged, and a comparison to SOS, though the language is poorly drafted. While apparently seeking to replicate reporting adopted in Maryland, the bill is, at best, ambiguous to the reporting entity (utility vs. supplier), requiring certain data only the utility would possess, but with language requiring all suppliers (as defined below) to file the reports
The relevant reporting section would have been only applicable to a "third-party electric supplier" that, "purchases electricity on the open market and sells it to a residential customer."
While ostensibly this may be intended to limit the reported data to residential service, the language itself does not accomplish such, nor does any following language in the bill.
For example, without any residential qualifier, the bill required a residential supplier to report, among other data, "The total supply cost charged to customers purchasing electricity from a third–party electric supplier". [emphasis added] While, as noted further below, the "third–party electric supplier average residential rates broken out by supplier" must be reported, which would rely on total volume and total charges specifically for residential service in order to calculate an average residential rate, nothing in the bill which requires the kWh and cost reporting specifies that the such reporting shall be limited to residential service when requiring that a "total" be reported
HB 393 also required "each" electric supplier to report, "The third–party electric supplier average residential rates broken out by supplier." Suppliers could report their own residential average rate, but would not have information to report the rates of other suppliers as required ("broken out by supplier")
The bill further required, for suppliers with a reporting obligation (defined above as only residential suppliers) to specifically report non-residential average rates, including their "average general service demand rates" and "average large power demand rates", whereas, as noted above, the bill does not specifically require, in its actual language, the reporting of "residential" rates. Note that, as written, this reporting data for non-residential classes would only be reported by suppliers who also are engaged in residential sales, but would not, under the bill itself, be required from suppliers who do not serve residential customers
While the bill generally appeared to seek reporting similar to that in Maryland, the language is ill equipped to require such, with no reporting obligation imposed on the utility for market-wide data, such as the bill's requirement to report, "The difference between the total third–party electric supplier average rate and the standard offer service average rate." [emphasis added]
Although the term "third-party electric supplier" could be read as including the SOS provider (utility), such a reading of the term "third-party electric supplier", which is used elsewhere in the bill
(although not specifically "defined" in other sections but with the bill using the exact same language to describe the entity), would require a strained reading of other provisions of the bill governing "third-party electric supplier" matters. For example, the price of residential service from a third-party electric supplier is capped, "as of the date of agreement with the customer". Although SOS customers do not enter contracts, customers must agree to be governed by the utility's tariffs, including the SOS tariff, as a condition of taking service. As such, if "third-party electric supplier" is read in the reporting section as meaning the utility, there is no basis to exclude the utility from other sections of the bill using the same term, and would impose an ostensible price cap on SOS
The bill would have granted the PSC with authority to, "adopt procedures to implement this section," relating to the reporting, but statutorily, the reporting section only applies to, "a company that purchases electricity on the open market and sells it to a residential customer," regardless of what the underlying data is
HB 393 would have required that, "all sales agents, including employees, and contractors," of a retail supplier must complete supplier-provided training, with such training required to be consistent with PSC standards
The PSC would have been required to develop a training program governing sales, consumer protections, and other matters, with at least one representative from a retail supplier required to pass PSC training
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Reporting by Paul Ring • ring@energychoicematters.com
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