Retail Supplier Says Door-to-Door Agents Should Pass TWO Background Checks; All Door-to-Door Sales Should be TPV'd

A retail supplier has recommended that the District of Columbia PSC adopt a series of minimum standards applicable to door-to-door sales of retail energy, and establish licensing parameters for third-party marketing agents.

Specifically, Constellation NewEnergy, Inc., in the wake of a recent hearing on supplier marketing in D.C. (see prior story), recommended that the PSC adopt minimum standards applicable to door-to-door marketing as follows:

• Two (2) mandatory background checks for every door-to-door sales agent employed by a marketing firm that is selling on behalf of a competitive supplier;

• Required drug screening for all marketing firm agents;

• Required third party verification (TPV) calls for door-to-door sales contracts;

• A requirement that the sales agents leave the home for such TPV calls;

• A requirement that a sales agent be terminated by the marketing firm upon a finding that a basic telephone number has been used for more than one enrollment (an indication of improper activity by the agent), and that the customers that were attempting to be enrolled with such phone number be kept on/returned to utility service without penalties;

• Required maintenance by the competitive supplier of specific zip code territories to which marketing firms and their agents are assigned for such competitive supplier (as well as zip codes for which agents are restricted to sell on behalf of the competitive supplier), to allow for ease of checks upon Commission or internal inquiries;

• A requirement that deal-contingent payments to agents not be made for a particular customer contract until the utility accepts the customer’s enrollment; and

• A requirement that competitive suppliers refrain from paying their marketing firms/agents for any sales for which customers are not successfully enrolled, such that only appropriate sales are compensated, thereby removing incentives for inappropriate sales activities by door-to-door agents.

Constellation also said that, in addition to those entities that are currently required to be licensed under the Commission’s regulations, the Commission should require a third-party which is marketing energy to be licensed where:

(a) The third-party is paid through a competitive supplier on behalf of a customer with respect to a particular transaction/contract between the competitive supplier and customer; and

(b) Such third-party takes actions on behalf of the customer that amount to more than an endorsement or referral of the competitive supplier.

Aside from its cursory statement that these principles would apply, "in addition to those entities that are currently required to be licensed," Constellation did not specifically address the current regulations governing licensing in the District, which as previously noted seem fairly broad, and could include entities that fall outside of Constellation's two-pronged test noted above.

As previously noted, under the D.C. code, for electricity, a "Broker" means, "a person who acts as an agent or intermediary in the sale and purchase of electricity but who does not take title to electricity," and an "Aggregator" means, "a person who acts on behalf of customers to purchase electricity."

Both brokers and aggregators are expressly included in the definition of "electricity supplier," and, "All electricity suppliers must obtain a license issued by the Commission in order to do business in the District of Columbia."

Docket GD 117

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