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December 8, 2017
NEM Upcoming Events

NEM’s Annual Winter Executive Committee Meeting will be held at the Hyatt Regency Hotel in Orlando, Florida on January 17-19, 2018. Please register at this hotlink. A draft Agenda is available at this hotlink. The Winter Executive Committee Meeting is where the members identify and prioritize the issues, states, and utility markets of greatest import. The national and regional leadership teams will help focus NEM’s advocacy, PR and policy development activities in 2018.

The Hyatt Regency Hotel in Orlando, Florida has a block of hotel rooms at an NEM Rate of $239, and discount tickets to Disney World and Universal Studios have been reserved for members. A golf outing and welcome reception for members will be held on January 17, 2018, at the Villas of Grand Cypress Golf Course. Hotel reservations can be made at this hotlink. Call NEM headquarters at (202) 333-3288 to register for golf.

NEM’s 21st Annual National Restructuring Conference will be held April 30 – May 2, 2018, at the Hyatt Regency Capitol Hill Hotel, Washington, DC. An agenda is forthcoming.

FERC Chair Requests Extension on Grid Resiliency Pricing NOPR

In October, Energy Secretary Perry proposed a rule for final action by FERC regarding grid reliability and resilience pricing. Secretary Perry proposed that FERC exercise its authority under Sections 205 and 206 of the FPA regarding just and reasonable rates for wholesale electric sales to establish rules for RTOs/ISOs "to ensure that certain reliability and resilience attributes of electric generation resources are fully valued." Perry cited the premature retirement of "fuel-secure" generation that can withstand fuel disruptions during disasters as a rationale.

New FERC Chairman McIntyre made a written request to Secretary Perry for a thirty day extension of FERC action on the rule, which is otherwise due next week. Chairman McIntyre cited the recent installation of two new FERC commissioners as well as a voluminous record of comments necessitating the extension. The full text of the Letter is available on the NEM Website.

Click here to view all past updates.
Rulemaking on Service Obligations, Sales and Marketing Practices of Alternative Retail Gas Suppliers

The Commission initiated a rulemaking to develop rules on the service obligations, sales and marketing practices of alternative retail gas suppliers. The rulemaking was commenced to incorporate similar consumer protections as were recently adopted with respect to alternative retail electric suppliers. The Commission directed that workshops should be held to attempt to build consensus on the rules, or portions of the rules. Staff was directed to develop a draft proposal, within thirty days, for consideration at the workshops. Following the workshops, Staff will file the proposed rules for consideration. The full text of the Initiating Order is available on the NEM Website.

Click here to view all past updates.
NEM Comments on Energy Choice Initiative Investigation

NEM filed Comments on the Commission's investigation of issues associated with implementation of the energy choice ballot initiative, The ballot initiative, if approved again in 2018, would establish a constitutional right to shop for electricity. NEM filed comments discussing steps to take during the transition to a full market opening, beginning with consumer education and utility rate unbundling. NEM recommended that the foundation for the success of the retail market is the utility's exit from the commodity merchant function and focus on its core competency of ensuring the reliability of delivery infrastructure. NEM suggested that additional best practices for a competitive retail electric market include: unbundled utility rates and market-based POLR pricing; consumer education; reasonable consumer protection, supplier certification and marketing standards; efficient customer enrollment methods; expeditious customer switching timeframes; consolidated billing options; timely access to data; mitigation of stranded costs and avoidance of punitive exit fees; code of conduct; and regulatory certainty to encourage supplier entry, investment and market participation. The full text of NEM's Comments is available on the NEM Website.

Click here to view all past updates.
Secretarial Letter on Residential Supplier Marketing Regulations

A Secretarial Letter was issued to all electric generation suppliers and natural gas suppliers with reminders of obligations under the Commission's regulations on "Marketing and Sales Practices for the Retail Residential Energy Market." The Commission urged all suppliers to review their current and planned residential sales and marketing activities to ensure compliance with the issues highlighted.

First, the Commission reminded suppliers that when contacting a potential residential customer, regardless of the marketing method, venue or technology utilized, the supplier must identify itself immediately and must accurately and completely state the purpose of the contact.

With respect to telemarketing, the Commission highlighted that telemarketing agents must immediately identify themselves upon contacting the potential customer, identify the supplier on whose behalf they are calling, and provide the specific reason for the call. Additionally, suppliers must be sure to comply with the state and federal Do Not Call Lists, regardless of a customer's inclusion on the utility's Eligible Customer List, and ensure that any phone lists are frequently "scrubbed" for compliance purposes.

With respect to door-to-door sales, the Commission stressed the following existing requirements: 1) performance of background checks and Megan's Law checks on door-to-door agents; 2) immediate identification of the supplier upon making contact with the customer; 3) agents use of an identification badge; 4) compliance with local ordinances on door-to-door marketing and sales activities and seasonal limitations on hours during which door-to-door sales can be made; 5) agents must immediately leave a customer's residence when requested to do so; 6) the requirement to notify the Commission's Bureau of Consumer Services no later than the morning of the day the supplier will commence door-to-door sales and marketing activity; and 7) sales verification procedures may only be started after the agent has left the residential customer's premises.

Regarding direct mail and electronic solicitations, the Commission noted that prohibitions against misleading and deceptive conduct and false and misleading representations are applicable. Also, requirements related to plain language descriptions of offerings, accurate and timely information about offerings, and availability of written information are applicable.

Finally, the Commission pointed out that suppliers are responsible for the fraudulent, deceptive or other unlawful marketing acts performed by their agents.

The full text of the Secretarial Letter is available on the NEM Website.

NOPR on Proposed Changes to Customer Information Regulations for Electric Generation Suppliers

The Commission issued a NOPR on proposed changes to customer information regulations for electric generation suppliers including standards and pricing practices for retail electricity service, the customer disclosure statement, marketing and sales activities, and the provision of contract expiration notices or notices of change in terms of service. Some of the proposed changes are to align the electric rules with recent changes made to the natural gas supplier rules related to customer disclosures.

Proposed changes include the following:
1) prohibiting the imposition of early termination fees once a supplier has provided the required contract expiration notices;
2) requiring that generation charges be expressed according to the actual prices per kilowatt hour. Also, "if the unit price changes based on customer usage or if the product includes fees in addition to the unit price, the price per kWh shall factor in all costs associated with the rate charged to the customer and show the average price per kWh for usage of 500, 1,000 and 2,000 kWh of electricity in table format." In his Statement on the NOPR, Vice Chairman Place requested comment on the impact of such a change on the offering of innovative products enabled by advanced metering;
3) for introductory price products, the pricing statement must note that it is an introductory price, the duration of the introductory period and the price for the first billing cycle after the introductory period;
4) for variable price products, inclusion of the supplier's specific prescribed variable pricing methodology;
5) inclusion in the disclosure statement of a description of when and how the customer will receive notification of price changes;
6) disclosure of contract penalties and fees in actual dollars or a specific method for determining actual dollars;
7) two options for disclosure language about contract expiration or change notices to better accommodate the differences between contracts of fixed duration and of non-fixed duration;
8) notification to the customer at the time of contracting if the contract is assignable. If a contract is to be assigned, prior notice must be provided to the customer, the utility and the Commission, including notice to the customer that the contract terms remain unchanged;
9) disclosure of whether the supplier intends to obtain customer account and usage information from the utility; and
10) the contract summary would be revised to require:
*that the customer be informed if the price is introductory, what the introductory price is and the price upon expiration of the introductory period
*disclosure of the generation price at various usage levels, if applicable
*informing the customer of the two notices they will receive as the contract expiration approaches
*referencing the customer's three day right of rescission.
The Commission also proposes to remove unnecessary references to the utility from the supplier disclosure statement.

Comments on the NOPR are due 60 days after publication in the PA Bulletin. The full text of the NOPR is available on the NEM Website.

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