Retail Energy Regulator Formally Adopts Broad Applicability Of Marketing Rules To "Friends & Family", Other "Goodwill" Marketing That Is Intended To "Induce" A Sale

The Illinois Commerce Commission formally adopted new marketing and related rules applicable to alternative retail electric suppliers and alternative gas suppliers

As first reported by EnergyChoiceMatters.com, the ICC had adopted a second notice order concerning the rules in June. The rules then proceeded to a review by the Joint Committee on Administrative Rules (JCAR).

JCAR issued a certification of no objection for each of the rules, and the ICC has now formally adopted the rules, as established in the second notice order, without modification

Unless otherwise noted in this story, both the electric and gas rules are substantively identical, and the story may only quote one of the sets of rules for illustrative purposes, for brevity.

Most notable about the final rules is that they do not change the definition of goodwill and institutional advertising from a prior proposal. The rules thus require all sales not meeting this definition to comply with the disclosure and other requirements in the rule

Under the adopted rules, "goodwill and institutional advertising" means, "any advertising either on a local or national basis designed primarily to bring the ARES’s name before the general public in such a way to improve the image of the ARES or to promote the ARES or the industry, and that does not (1) contain information about prices, terms, or conditions of retail electric supply products or services offered by ARES to customers or (2) direct or induce customers to sign up for such products or services."

In its June order, the ICC had explained that if an advertisement encourages customers to sign up for energy supply, "that advertising is not 'Goodwill or institutional advertising,'"

Furthermore, the ICC had declined to revise the definition of in-person solicitation, which is defined to mean, "any sale initiated or conducted when an ARES sales agent is physically present with the customer."

Retail suppliers had proposed additional language stating that an in-person solicitation, "does not include contacts by an ARES agent which cannot result directly in an enrollment."

The ICC in June had affirmed its prior finding that, "If a discussion cannot result in an enrollment, then it is not a 'sale[,]' but the Commission agrees with Staff that the timing of that enrollment need not be immediate. The Commission therefore further agrees with Staff that an in-person conversation by a sales agent that is meant to later induce the consumer to enroll by other means should receive the same oversight and quality control by retail supplier management and Commission rules as more direct in-person solicitations."

The adopted rules provide that, if a residential variable rate customer's rate increases by more than 20% from one monthly billing period to the next, the ARES shall send a separate written, dated, notice to the customer, informing the customer of the upcoming rate change, and such notice shall include the electric utility’s price to compare (PTC).

See our prior story for full details of the rules, which were formally adopted by the ICC without modification from its June second notice order

Docket 20-0457 et al.