Texas Senate Passes New Disconnection Protections Applicable To Customers Of Retail Electric Providers

Last week, the Texas Senate passed SB 2194 which, among other things, includes new disconnection protections for customers of retail electric providers, including expansion of the conditions under which disconnections are prohibited, and other customer rights concerning the disconnection process and related service.

The engrossed version of SB 2194 provides that, notwithstanding any other law, a buyer of retail electric service has the right to:

(1) avoid discontinuation of electric service for nonpayment on a Saturday or Sunday or a holiday observed by an electric utility or retail electric provider, unless the utility or provider is open to accept payment and restore service on that day;

(2) avoid discontinuation of electric service for a period of 60 days of nonpayment if an electric utility or retail electric provider receives written notice from a medical doctor licensed to practice in this state or a state that shares a border with this state that certifies that discontinuation of service would create a life-threatening situation for the customer or a permanent resident of the customer's household;

(3) negotiate with a retail electric provider a deferred payment plan to avoid discontinuation of electric service for a delinquent account in accordance with the utility's or provider's terms and conditions;

(4) avoid discontinuation of electric service or refusal of service for a location because a former occupant at that location, not of the same household, failed to pay a previous bill;

(5) avoid disconnection of electric service during periods when temperatures exceed 100 degrees Fahrenheit or fall below 32 degrees Fahrenheit and at times described by Section 39.101(h);

(6) avoid discontinuation of electric service on account of nonpayment if the customer has been approved for Low Income Home Energy Assistance Program benefits in an amount equal to the delinquent balance, the customer has provided notice of the approval to the electric utility, and the benefits are payable before the 30th day after the date the customer provides the notice;

(7) avoid discontinuation of electric service for failure to pay a portion of any bill that is in dispute if the customer provides a deposit for the amount in dispute;

(8) avoid discontinuation of electric service for nonpayment of bills if, as of 8 a.m. on the scheduled date of disconnection, a freeze warning has been issued by the National Weather Service for the county of the scheduled disconnection;

(9) avoid discontinuation of electric service for nonpayment of bills if, as of 8 a.m. on the scheduled date of disconnection, an excessive heat warning has been issued by the National Weather Service for the county of the scheduled disconnection;

(10) request a written explanation for the reason a retail electric provider refuses to serve a customer if the utility or provider refuses to initially serve the customer;

(11) receive a written explanation from an electric provider that refuses to initially serve a customer, after the customer provides the utility or provider with a valid mailing address, that includes:

(A) the reason service is being refused; and

(B) a description of the actions the customer must take in order to receive service;

(12) be given accurate and understandable information concerning the price and terms of service for electric service; and

(13) have access through the commission to an independent administrative process that provides a simple, quick, and effective means of resolving complaints about electric service and bills for customers who are unable to resolve disputed bills directly with a retail electric provider.

Among other provisions, SB 2194 also includes the requirement, also included in recently passed HB 16, that for a residential customer that does not make an affirmative choice at the end of their contract term, the REP must serve the customer under a default renewal product that the customer may cancel at any time without a fee.

The default renewal product must be: (1) a month-to-month product in which the price the customer pays for electricity may vary between billing cycles; and (2) based on clear terms designed to be easily understood by the average customer.

For more details on the revised contract expiration notification requirements and default renewal product, see our story last week on HB 16 (SB 2194's provisions on these matters are substantially similar)

SB 2194 also includes the prohibition on wholesale indexed products for both residential and small commercial customers, similar to the provision in HB 16

Also substantially similar to HB 16, SB 2194 includes a requirement that, for other (larger) customers, in order for a retail electric provider to serve the customer on a wholesale indexed product, the REP must obtain a "signed" acknowledgment from the customer concerning the customer's understanding of the risks of wholesale indexed products.

Such acknowledgment must include the following statement, in clear, boldfaced text: "I understand that the volatility and fluctuation of wholesale energy pricing may cause my energy bill to be multiple times higher in a month in which wholesale energy prices are high. I understand that I will be responsible for charges caused by fluctuations in wholesale energy prices."