Utility Suggests Requiring Utility to Receive "Direct" Customer Consent Prior to Executing Supplier Switch

A utility has suggested requiring that utilities receive direct, actual customer consent prior to executing a switch to another energy supplier.

Specifically, a representative from Pepco, at Friday's District of Columbia hearing on energy supplier marketing, suggested that one area for consideration to reduce slamming would be whether customer consent for a switch can continue to be provided by a "third party," or whether instead "the company" must get consent, "directly from the customer before switching them to a third party" (emphasis added).

In response to a follow-up question from PSC Chairman Betty Ann Kane, Pepco's representative affirmed that "the company" referred to the utility -- meaning that Pepco would have to get consent directly from the customer for a switch.

Note that this appears to mean (with the emphasis on "directly from the customer") that Pepco would, itself, conduct verification on all competitive supply enrollments, rather than just reviewing the verifications obtained by suppliers (which itself would be problematic, but at least something which has been suggested or has been in place at prior times in other markets with respect to customer information authorization, if not switches)

Also complicating matters is that Pepco is one of the few utilities that has the ability to earn a margin on SOS sales, meaning it would have an incentive to maintain customers on SOS instead of competitive supply.

Pepco's representative also suggested that it seemed that the current standard for executing a switch was much more "automatic" than the affirmative consent standard required for Pepco to initiate service to a new distribution account.

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