State Proposes Requiring Retail Suppliers to Obtain New Customer Consent for Any Rate Change

Staff of the Maryland PSC have proposed that the Commission adopt regulations that would require a notice of change in a retail supplier's rate prior to the rate being billed to customers and require what Staff terms a "soft verification" that demonstrates the customer's willingness to maintain the revised agreement with new rates and or fees.

Staff's proposed language, in a final report on the PC 35 working group process, provides that, "if the contract is a month to month contract or has a variable rate term, a supplier shall provide a customer with advance notice 30 days before the customer's billing date of any change in the rate to be charged to the customer."

For term contracts, suppliers would be required to provide a notice to the customer of any changes in terms, including rate, 30 days prior to the billing date.

For both types of contracts, the supplier would be required to, "obtain approval from the customer to maintain the contract under the new offer terms and conditions or under the new variable rate."

"Notice can be provided, and approval can be obtained in writing, via electronic means or through telephone verification," Staff proposed language provides.

If customer approval of the new rate is not obtained by the supplier within 15 days of the customer's billing date, the supplier shall either:

(i) return the customer to standard offer service; or

(ii) continue to bill at the prior agreed upon rate.

Staff's proposal would also require suppliers to utilize a new choice disclosure sheet, or Schumer-box type disclosure.

An example of the proposed choice disclosure sheet can be found on page 71 of Staff's proposal.

Notably, the disclosure sheet would require a statement that, "The supply price may not always provide a savings."

For telephonic contracts, the choice disclosure sheet, "shall be included with the contract documents required by Maryland law or into the TPV for exempt transactions, and shall be included with the copy of the agreement mailed to the customer."