PRINTER'S NO. 1023
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
844
Session of
2015
INTRODUCED BY GODSHALL, BAKER, COHEN, CALTAGIRONE, GAINEY,
KAUFFMAN, DAVIS, REESE, GERGELY, MENTZER, KORTZ, PASHINSKI,
BARRAR, HANNA, WATSON, SNYDER, DEASY, MATZIE, MILLARD,
SAYLOR, BIZZARRO, CARROLL, CONKLIN, GABLER, D. COSTA AND
MOUL, MARCH 26, 2015
REFERRED TO COMMITTEE ON CONSUMER AFFAIRS, MARCH 26, 2015
AN ACT
Amending Title 66 (Public Utilities) of the Pennsylvania
Consolidated Statutes, providing for retail electric consumer
protection.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 66 of the Pennsylvania Consolidated
Statutes is amended by adding a chapter to read:
CHAPTER 28A
RETAIL ELECTRIC CONSUMER PROTECTION
Sec.
28A01. Scope of chapter.
28A02. Definitions.
28A03. Variable-rate product contract terms.
28A04. Fixed-rate product contract terms.
28A05. Contract provisions.
28A06. Variable-rate changes.
28A07. Investigations and enforcement.
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28A08. Variable-rate and fixed-rate product rates.
28A09. Contract formation.
28A10. Duties of electric generation suppliers and electric
distribution companies.
28A11. Consumer education information.
28A12. Civil penalties.
28A13. Applicability.
§ 28A01. Scope of chapter.
This chapter relates to retail electric consumer protection
for residential and small commercial customers.
§ 28A02. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
" Authorized representative. " Any of the following:
(1) A spouse of a customer.
(2) Any other person who is not a spouse of a customer
and who is authorized by the customer to initiate a change of
the customer's electric generation supplier by a signed
document provided to the electric distribution company by the
customer identifying the person as authorized to initiate the
change.
"Cancellation fee or early termination fee." An amount
specified in a contract that permits an electric generation
supplier to assess and collect a fee or other similar charge
from a residential or small commercial customer who terminates a
contract before the end of the contract term, regardless of:
(1) how the fee or other similar charge is identified in
the contract; or
(2) whether or not the fee or other similar charge is
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fixed or subject to calculation based on market factors.
"Contract." The terms and conditions of service provided by
an electric generation supplier.
"Default service provider." An electric distribution company
within its certified service territory or an alternative
supplier, including an electric generation supplier, approved by
the commission that provides generation service to retail
electric customers who:
(1) contract for electric power, including energy and
capacity, and the chosen electric generation supplier does
not supply the service; or
(2) do not choose an alternative electric generation
supplier.
"Electric distribution company." A public utility that
provides facilities for the jurisdictional transmission and
distribution of electricity to retail customers, except building
or facility owners or operators that manage the internal
distribution system serving a building or facility and that
supply electric power and other related electric power services
to occupants of the building or facility.
"Electric generation supplier." A person or corporation,
including a municipal corporation that chooses to provide
service outside the municipal corporation's municipal limits,
except to the extent provided before January 1, 1997, brokers
and marketers, aggregators or any other entity, that sells to
end-use customers electricity or related services utilizing the
jurisdictional transmission or distribution facilities of an
electric distribution company or that purchases, brokers,
arranges or markets electricity or related services for sale to
end-use customers utilizing the jurisdictional transmission and
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distribution facilities of an electric distribution company. The
term does not include an electric distribution company or any of
the following:
(1) A building or facility owner or operator that
manages the internal distribution system serving the building
or facility and that supplies electric power and other
related power services to occupants of the building or
facility.
(2) An electric cooperative corporation, except as
provided in 15 Pa.C.S. Ch. 74 (relating to generation choice
for customers of electric cooperatives).
(3) A default service provider.
"Fixed-rate product." A retail electric generation product
offered by an electric generation supplier when the rate charged
per kilowatt hour for each billing cycle of the contract term is
an all-inclusive per kilowatt hour price, excluding applicable
sales tax, that will remain the same for at least three billing
cycles or the term of the contract, whichever is later.
"Index-based product." A retail electric generation product
in which the price for one or more components of the retail
electric generation service can change according to a predefined
pricing formula or is based on publicly available market
indices.
"Month-to-month transition product." A retail electric
generation product in which the the kilowatt hour rate for each
billing cycle may change that is offered by an electric
generation supplier to a residential or small commercial
customer after the customer's initial contract term expired as a
result of the customer not affirmatively entering into a new
contract with the supplier, switching to another electric
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generation supplier or returning to default service.
"Off-cycle switch." A switch to a competitive electric
generation supplier or default service provider that takes place
on a date other than a customer's regularly scheduled meter read
date.
" Real-time pricing product. " A rate that directly reflects
the different cost of electricity during each hour.
"Residential customer." Any of the following:
(1) An individual or authorized representative:
(i) who enters into a contract to receive service
from an electric generation supplier;
(ii) whose name is listed on a residential service
account; and
(iii) who is primarily responsible for payment of
bills rendered for the service.
(2) An occupant of a residence receiving service who is
18 years of age or older and whose name appears on the
mortgage, deed or lease of the residence, or an authorized
representative.
"Small commercial customer." A nonresidential customer who
enters into a contract to receive electric generation service
from an electric generation supplier and has a peak cumulative
demand of less than 25 kilowatts during any 12-month period.
"Switch." The transfer of a residential or small commercial
customer from any of the following:
(1) An electric generation supplier's service to another
electric generation supplier's service.
(2) A default service provider's service to an electric
generation supplier's service.
(3) An electric generation supplier's service to a
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default service provider's service.
"Time-of-use rate." A rate that reflects the costs of
serving customers during different time periods, including off-
peak and on-peak periods, but not as frequently as each hour.
" Transition. " The moving of a customer, upon expiration of a
fixed-rate contract, when the customer has not affirmatively
acted to renew the contract with an electric generation
supplier, switch to another supplier or return to the default
service provider to a product specified in section 28A04(b)(2)
(relating to fixed-rate product contract terms). The term does
not include a request from a customer to an electric generation
supplier for a new or different product upon expiration of the
contract.
"V ariable-rate product." A retail electric generation
product offered by an electric generation supplier when the rate
charged per kilowatt hour for each billing cycle of the contract
term is an all-inclusive per kilowatt hour price, excluding
applicable sales tax, that can change by the hour, day, month or
other period according to the terms and conditions of a
customer ' s contract.
§ 28A03. Variable-rate product contract terms.
(a) Contract duration.--A contract for a variable-rate
product offered by an electric generation supplier to a
residential or small commercial customer shall specify the terms
of the contract.
(b) Promotional rates.--A contract for a variable-rate
product offered by an electric generation supplier to a
residential or small commercial customer may not include a
promotional or "teaser" per kilowatt hour rate for a period of
less than 60 days.
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(c) Fees prohibited.-- Except for an index-based product, a
contract under subsection (a) may not contain a cancellation fee
or early termination fee.
(d) Rate prohibition.--An electric generation supplier may
not enter into any of the following:
(1) A contract for a fixed-rate product with a
residential customer who participates in an electric
distribution company's customer assistance program as defined
in section 1403 (relating to definitions) unless the price
for the product is equal to or less than the default service
price at the time the contract is executed.
(2) A contract for a variable-rate product with a
residential customer who participates in an electric
distribution company's customer assistance program as defined
in section 1403.
(e) Electric distribution company duties.--An electric
distribution company shall include any necessary information on
a customer list provided to an electric generation supplier to
allow the supplier to comply with requirements of subsection
(d).
(f) Index-based products.--
(1) Except as provided in paragraph (2), an electric
generation supplier may not offer an index-based variable-
rate product to a residential customer.
(2) Paragraph (1) shall not apply to a time-of-use rate
or real-time pricing product offered by an electric
generation supplier to a residential customer.
§ 28A04. Fixed-rate product contract terms.
(a) Contract duration.--A contract for a fixed-rate product
offered by an electric generation supplier to a residential or
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small commercial customer shall specify the term of the
contract.
(b) Contract expiration.--
(1) Upon the expiration of a contract for a fixed-rate
product, an electric generation supplier may not transition a
residential or small commercial customer to a contract for a
variable-rate product.
(2) An electric generation supplier may transition a
residential or small commercial customer whose contract for a
fixed-rate product has expired when the customer has not
affirmatively entered into a new contract with the supplier,
switched to another electric generation supplier or returned
to default service, to any of the following:
(i) A month-to-month transition product with no
cancellation or early termination fee. Upon transitioning
a customer to a month-to-month transition product under
this subparagraph, no less than 45 days before the
customer's initial contract expires, the electric
generation supplier shall provide notice to the customer
in writing, or via electronic means or other delivery
method agreed to by the customer, that the product is a
30-day product and the initial applicable rate. No later
than 30 days before implementing a change in the rate
charged under a month-to-month transition product under
this subparagraph, the supplier shall provide notice to
the customer in writing, or via electronic means or other
delivery method agreed to by the customer. A month-to-
month transition product offered under this subparagraph
may not be increased more than 30% of the kilowatt hour
rate charges during the preceding bill cycle and the
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supplier may opt to implement a lower per billing cycle
percentage increase cap.
(ii) A new fixed-rate product contract. Upon
transitioning a customer to a new fixed-rate product
under this subparagraph, no less than 45 days before the
customer's initial contract expires, the electric
generation supplier shall provide notice to the customer
in writing, or via electronic means or other delivery
method agreed to by the customer, of the new fixed-rate
contract terms and any applicable cancellation or early
termination fees. A cancellation or early termination fee
under this subparagraph may not exceed $100.
(3) An electric generation supplier shall continue to
provide service to a customer whose fixed-rate product
contract has expired under paragraph (2) until the earliest
of the following:
(i) the customer enters into a new contract;
(ii) the customer switches to another electric
generation supplier;
(iii) the customer returns to a default service
provider's service; or
(iv) the electric generation supplier returns the
customer, upon expiration of the contract, to the default
service provider.
§ 28A05. Contract provisions.
(a) General rule.--An electric generation supplier shall
include the following provisions in no less than 12-point font
in a contract for a variable-rate product or fixed-rate product:
(1) The name, address, toll-free telephone number,
mailing address, e-mail address, publicly accessible Internet
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website and commission certification number of the electric
generation supplier.
(2) The rate applicable to the contract term. The rate
shall be presented in a cents per kilowatt hour format.
(3) The expiration term of the contract.
(4) A statement in all capital letters that authorizes
the customer to rescind the contract within three business
days of receipt of the contract without incurring a
cancellation fee or an early termination fee.
(b) Mailbox rule.--A contract provided to a customer via
first class mail shall be deemed received by the customer within
three business days of being placed in the mail.
(c) Variable-rate product contracts.--An electric generation
supplier shall include the following provisions in no less than
12-point font in a contract for a variable-rate product:
(1) An explanation of the method or formula used to
determine the rates for a variable-rate product.
(2) A statement specifying that variable rate s are
subject to change.
(3) The length of time a promotional or initial rate is
applicable.
(4) A statement as follows:
The rate to be applied during your first billing
cycle or the promotional period is (insert rate); this
rate may increase by no more than (insert percentage of
rate cap) per billing cycle.
(5) A publicly accessible Internet website or toll-free
telephone number that a customer may call for current
variable-rate product pricing information.
(6) For an index-based product, the formula or market
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indices used to determine the rate.
(d) Fee provisions.--An electric generation supplier shall
include the amount and terms of a cancellation or early
termination fee, if any, in no less than 12-point font in a
contract for a fixed-rate product.
(e) Disclosure box.--
(1) An electric generation supplier shall include a
customer disclosure box on the top of the first page of a
contract with a residential or small commercial customer that
summarizes the key terms and conditions included in the
product offer or contract. The terms and conditions shall be
in no less than 14-point font and shall be conspicuous and in
plain language so that it may be easily understood by a
layperson.
(2) Any written marketing material promoting a specific
product of an electric generation supplier shall include the
key terms and conditions for the product offered. The terms
and conditions shall be prominently displayed using language
that may be easily understood by a lay person.
(3) The customer disclosure box under paragraph (1) and
the written marketing material under paragraph (2) shall
include all of the following:
(i) The term of the contract.
(ii) For a fixed-rate product offer or contract, the
applicable rate.
(iii) For a variable-rate product offer or contract,
the initial or promotional rate, the length of time the
rate is applicable and the terms of variability,
including the applicable cap.
(iv) For an index-based product, the formula or
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market indices used to determine the rate.
(v) The dollar amount of a cancellation or early
termination fee, if applicable.
(vi) A description of the notices to be provided
upon expiration of the contract term.
(vii) Contact information for the electric
generation supplier.
(viii) Other information required by the commission.
(f) Disclosure modification.--The commission may add to or
modify the disclosures required under this section as necessary
to accommodate changes in market conditions, product offerings
and technology.
§ 28A06. Variable-rate changes.
(a) Limitations on rate changes.--The kilowatt hour rate
charged to a residential or small commercial customer under a
contract for a variable-rate product, other than an index-based
product, may not be increased by more than 30% of the kilowatt
hour rate charged during the preceding billing cycle. An
electric generation supplier may choose to implement a lower per
billing cycle percentage increase cap.
(b) Average kilowatt hour rate.--
(1) The rate contained in a customer bill for service
provided by an electric generation supplier shall reflect the
average kilowatt hour rate for the applicable billing cycle.
(2) Paragraph (1) shall not apply to a time-of-use rate
or real-time pricing product.
§ 28A07. Investigations and enforcement.
(a) Investigations.-- The commission may investigate consumer
complaints related to increases in the retail electric rates
charged by an electric generation supplier.
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(b) Required information.--If the commission is
investigating a consumer complaint related to a variable-rate
contract under subsection (a), the commission may require an
electric generation supplier to provide information on the
formula, mechanism, market indices, wholesale electric rates or
actual costs that provide the basis for the variable rate under
the contract.
(c) Coordination.-- The commission and the Office of Attorney
General, Bureau of Consumer Protection may work in a coordinated
manner to investigate and share complaint information as
necessary to ensure that the commission and the Office of
Attorney General, Bureau of Consumer Protection have the data
required to determine if a violation of this title or the act of
December 17, 1968 (P.L.1224, No.387), known as the Unfair Trade
Practices and Consumer Protection Law, is likely to have
occurred and may take appropriate independent action.
§ 28A08. Variable-rate and fixed-rate product rates.
(a) Rate notice.--
(1) No less than once every 30 days, an electric
generation supplier offering service to residential or small
commercial customers shall post the present nonpromotional
rate or range of rates for each variable-rate product on the
electric generation supplier's publicly accessible Internet
website and shall make the rate information available to
customers via a toll-free telephone number.
(2) Upon request by a residential or small commercial
customer, the electric generation supplier shall provide the
current applicable nonpromotional rate for each variable-rate
product and fixed-rate product in writing to the customer or
via electronic or other delivery method agreed to by the
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customer. The rate shall be contained in the electric
generation supplier's marketing and sales materials,
including telephone solicitations.
(b) Rate history.--
(1) No later than January 30 of each year, an electric
generation supplier offering service to residential or small
commercial customers shall post a one-year rate history for
its average monthly billed rates, by rate class and utility
service territory, for each publicly available variable-rate
product and fixed-rate product for the preceding year, or a
history of each product offered for less than one year, on
the PA Power Switch Internet website and the electric
generation supplier's publicly accessible Internet website.
The commission shall maintain an archive of rate history
information under this paragraph and shall make it available
on the PA Power Switch Internet website or its publicly
accessible Internet website.
(2) Upon request by a residential or small commercial
customer the electric generation supplier shall provide the
rate history as required under paragraph (1) in writing to
the customer or via electronic means or other delivery method
agreed to by the customer.
§ 28A09. Contract formation.
An electric generation supplier may not provide service to a
residential or small commercial customer without the customer's
written signature on a contract, electronic consent,
authorization form or other form of verification as permitted by
the commission to initiate service, renew service or switch
service.
§ 28A10. Duties of electric generation suppliers and electric
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distribution companies.
(a) Electric generation supplier.--An electric generation
supplier shall have the following duties:
(1) No later than one business day after a contract to
initiate service, renew service or switch service is
authorized to be formed under section 28A09 (relating to
contract formation), and after the customer account
information has been validated, send a copy of the contract
to the customer. At the option of the customer, the electric
generation supplier shall provide the copy to the customer in
person, by first class mail or electronically.
(2) No later than one business day after the expiration
of the three-day rescission period under section 28A05
(relating to contract provisions), notify the electric
distribution company of a switch request by the customer.
Notice under this paragraph may be delayed in order to
accommodate a postdated switching enrollment start date
requested by a customer.
(b) Electric distribution company.--No later than five
business days after receiving notice under subsection (a)(2),
the electric distribution company shall complete the switch
request to allow the customer to begin receiving service from
the electric generation supplier or default service provider.
(c) Off-cycle switching.--An electric distribution company
shall develop and implement switching protocols to accommodate
off-cycle switching as follows:
(1) Beginning six months after the effective date of
this paragraph, the electric distribution company shall have
the necessary protocols in place to accommodate one off-cycle
switch per customer per billing cycle. The commission shall
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grant a request by the electric distribution company for an
extension of the six-month period under this paragraph for
good cause shown.
(2) Beginning one year after the electric distribution
company implements paragraph (1), an electric distribution
company shall have the necessary protocols to accommodate
additional off-cycle switches.
(d) Cost recovery.--An electric distribution company shall
recover, on a full and current basis, in accordance with a
reconcilable automatic adjustment clause under section 1307
(relating to sliding scale of rates; adjustments), the
reasonable costs associated with modifying its metering and
billing equipment and systems, information technology,
procedures and protocols necessary to complete switching
requests under this section, including, but not limited to,
annual depreciation, capital costs and ongoing operations and
maintenance expenses. Costs recovered under this subsection
shall not include costs recovered under section 2807(f)(7)
(relating to duties of electric distribution companies).
(e) Applicability.--
(1) This section shall not apply to an electric
distribution company that is not subject to the requirements
of section 2807(f).
(2) An electric distribution company that is not subject
to the requirements of this section shall complete a switch
request in a manner consistent with electronic data transfer
and exchange standards at the beginning of the first feasible
billing cycle after receipt of the switch request.
§ 28A11. Consumer education information.
(a) Information compilation.--The commission shall compile
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the following information:
(1) A list of each electric generation supplier licensed
by the commission.
(2) The types of services available in the electric
generation retail market and the advantages and disadvantages
of each service.
(3) The percentage rate of customer complaints filed
against each electric generation supplier and the disposition
of the complaints.
(4) Any information the commission determines will
assist customers in making informed decisions when choosing
an electric generation supplier.
(b) Publication of information.--The commission shall post
the information under subsection (a) on the PA Power Switch
Internet website and, upon request of a customer, make the
information available in writing to the customer or via
electronic means or other delivery method agreed to by the
customer. The commission shall provide the information in a
standard format that is easily understandable by a layperson.
§ 28A12. Civil penalties.
Notwithstanding section 3301 (relating to civil penalties for
violations), an electric generation supplier that violates this
chapter shall pay a fine of not more than $10,000 to the
Commonwealth for each violation.
§ 28A13. Applicability.
Except as provided in sections 28A03(e) (relating to
variable-rate product contract terms) and 28A10 (relating to
duties of electric generation suppliers and electric
distribution companies), this chapter shall not apply to
electric distribution companies.
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Section 2. This act shall take effect in 60 days.
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