Maryland PSC Opens Proceeding on Retail Electric, Gas Customer Protections

The Maryland PSC has opened a proceeding (PC 35) to review the current status of protections for customers in connection with competitive retail gas and electricity supply, and to solicit recommendations on ratepayer protections.

Recent legislation (Senate Bill 1044/House Bill 928) requires the Commission to submit a report to the General Assembly no later than January 1, 2015, on the status of the Commission’s efforts to provide appropriate protections for consumers in connection with competitive retail gas and electricity supply. The report must include information and recommendations pertaining to:

(1) the adequacy of the Commission’s current retail electricity and gas customer choice consumer protection regulations;

(2) the adequacy of the Commission’s enforcement of current electricity and gas customer choice consumer protection laws and regulation;

(3) whether to require further safeguards in connection with the verification of retail electricity or gas contracts;

(4) whether to require further safeguards in connection with consumer comprehension of retail electricity or gas contracts;

(5) whether to require licensing of individuals who sell or facilitate the sale of retail electricity or gas contracts;

(6) any other issues the Commission considers relevant to these issues; and

(7) whether legislation is necessary to further any recommendations in the report, and if so, shall include draft legislation of any necessary statutory changes.

Every electricity and natural gas "supplier" licensed by the Commission to do business in Maryland was directed to file responses to a series of questions, including:

• Provide the range of variable rates charged to Maryland customers by month since January 2013, broken down according to utility service territory and customer sector.

• Does the company discount or otherwise reduce the price of the service for an introductory period as a sales incentive? If so, describe the length of the introductory period, and how setting the price for the introductory period differs from that of later months.

• Describe how the company informs customers of the nature of variable rate contracts and the methodology of setting variable rate prices, and include any relevant materials depicting this description as shared with customers.

• Provide a description of the customer’s cancellation process for each type of service offered by the company, as it is explained and provided to the customer at the time of solicitation.

• Information regarding termination fees, including the revenue realized from any termination fees since January 2013

• Information regarding call center staffing

• The full range and average number of calendar days by month since December 2013 that it took the company to return the customer to Standard Offer Service or Sales Service after receiving notification of the customer’s intent to cancel service from the supplier, broken down according to utility service territory and customer sector.

• Provide the approximate breakdown of the company’s reliance on door-to-door marketing, telephone solicitations, direct mail, "friends and family", or other methods (please describe) to solicit new customers. Include in this description the method of verification of the sale. If a third party verification method is utilized, provide the name of the company used to perform the TPV.

• Does the company use a third party or parties to market, advertise, solicit, or otherwise facilitate the sale of electricity or natural gas supply services? If so, provide the name(s) of the third party(ies) and a brief description of the third party’s role in the company’s supply of retail services to a customer.

• Does the Company include in its third party verification (TPV) call a confirmation that the company representative ensured that the customer understands the methodology of a variable rate contract, if applicable? Provide examples of this recording and TPV script used prior to issuance of this Order.

The PSC also directed that a working group be established to help inform the report.