HOUSE DOCKET, NO. 2840 FILED ON: 1/19/2023
HOUSE . . . . . . . . . . . . . . . No. 3155
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The Commonwealth of Massachusetts
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PRESENTED BY:
Tackey Chan
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To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
Court assembled:
The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
An Act modernizing competitive energy supply.
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PETITION OF:
Name: | District/Address: | Date Added: |
Tackey Chan | 2nd Norfolk | 1/19/2023 |
HOUSE DOCKET, NO. 2840 FILED ON: 1/19/2023
HOUSE . . . . . . . . . . . . . . . No. 3155
By Representative Chan of Quincy, a petition (accompanied by bill, House, No. 3155) of Tackey Chan relative to competitive energy supply. Telecommunications, Utilities and Energy. |
The Commonwealth of Massachusetts
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In the One Hundred and Ninety-Third General Court
(2023-2024)
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An Act modernizing competitive energy supply.
Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:
SECTION 1. Section 1 of chapter 164 of the General Laws, as appearing in the 2020 Official Edition, is hereby amended by inserting the following definition:-
“energy marketer” any person, firm, partnership, association or private corporation that markets, advertises, or otherwise offers to sell generation service to retail customers that is acting as an agent for a supplier.
SECTION 2. Section 1D of chapter 164 of the General Laws, as so appearing, is hereby amended by inserting, before the word “Beginning” in line 1, the following:- (i)
SECTION 3. Said section 1D of said chapter 164 of the General Laws, as so appearing, is hereby further amended by adding at the end thereof the following 2 new subsections:-
(ii) Distribution companies shall implement accelerated switching such that electric customers to change electric suppliers within 3 business days of receiving the enrollment transaction. Residential and small commercial customers moving within a distribution company’s territory shall have their competitive supplier of energy transferred directly to their new service location without being required to switch to an interim rate provided by the distribution company or other supplier.
(iii) Not later than 6 months after March 1, 2022, in order to further promote customer choice and convenience in a restructured electricity and gas market, the department shall commence a proceeding to implement enhancements to the distribution companies systems to facilitate the ability for retail electric suppliers to send bills to retail customers pursuant to a single bill format from the retail electric supplier company that shows both energy-related charges and distribution-related charges; provided, however, that all bills shall contain information concerning the quantity of gas or electricity consumed by said customer during the same billing period for the previous year as provided by the distribution company. The department is hereby authorized and directed to determine whether any additional information shall be required to be disclosed on the bills and to promulgate rules and regulations to implement the provisions of this subsection.
For retail electric suppliers who have chosen, and been approved by the department, to provide consolidated bills pursuant to this subsection (iii), the retail electric supplier shall make timely payments to distribution companies in accordance with this paragraph. The retail electric supplier shall: (a) bill its customers receiving a single consolidated bill from the supplier for the distribution charges; (b) pay such distribution companies the full amounts due from customers for distribution services in a time period consistent with the average payment period of the participating class of customer, less a percentage of amounts that reflects the average of the uncollectible bills for the participating customer classes of the retail electric company. The department shall conduct a review of the consolidated billing program every three years to adopt rules with respect to the recovery of uncollectable expense.
SECTION 4. Section 1F of said chapter 164 of the General Laws, as so appearing, is hereby amended by striking out subparagraph (iii) of paragraph (1), and inserting in place thereof the following 3 subparagraphs:-
(iii) All energy brokers, energy marketers, and other suppliers seeking to do business in the commonwealth shall submit a license application to the department, subject to rules and regulations promulgated by the department and subject to a fee, the amount to be determined by the department; provided, said amount shall not be less than $10,000. Each energy marketer or other supplier that applies for a retail license shall execute and maintain a bond issued by a qualifying surety or insurance company authorized to transact business in the commonwealth of Massachusetts in favor of the commonwealth. The amount of the bond shall equal $5,000,000 per retail license as issued by the department. The bond shall be conditioned upon the full and faithful performance of all duties and obligations of the applicant as a retail supplier and shall be valid for a period of not less than 1 year. The cost of the bond shall be paid by the applicant. The applicant shall file a copy of this bond, with a notarized verification page from the issuer, as part of its application for certification.
(iv) Any third-party who contracts with or is otherwise directly engaged and compensated by a supplier to sell electric generation services, or contracts with and is directly compensated by a third-party marketer of the supplier to sell electric generation services on behalf of a supplier, shall be a legal agent of the supplier. No third-party may sell electric generation services on behalf of a supplier unless such third party has received appropriate training directly from such supplier. This subparagraph (iv) shall not apply to third-party Electricity Brokers as defined under 220 CMR 11.02, or consultants or agents acting on behalf of customers that are compensated by the customer as part of the customer’s electric contract price.
(v) The department shall develop a training and educational program for any entity or individual that is licensed by the department under this section as a competitive supplier. The department shall develop the program in consultation with interested stakeholders, including competitive suppliers. The program shall require that a designated representative of each licensed competitive supplier demonstrate a thorough understanding of the department’s regulations regarding sales, consumer protection and any other matter the department deems appropriate though an online training program. At the conclusion of the training, the department shall conduct an online examination and, on a satisfactory score, certify that the designated representative of the licensed competitive supplier has successfully completed the training. The department shall determine the schedule and frequency by which a designated representative of a licensed competitive supplier must complete the training and certification. The department may not issue a license to a new competitive supplier until a designated representative of the new competitive supplier completes the training and certification. The department may adopt regulations that include appropriate penalties for failure to comply with this subparagraph. The department shall use the assessments collected in accordance with paragraph (13) for the initial development of the training and educational program. The department may establish reasonable fees as authorized to fund the training and educational program.
SECTION 5. Said section 1F of said chapter 164 of the General Laws, as so appearing, is hereby further amended by adding after subparagraph (ix) of paragraph (8)(a), the following new subparagraph:-
(x) Energy brokers, energy marketers, or other suppliers that market and sell to residential customers using in-person or door-to-door marketing practices, must use a third-party verification process as defined in subparagraph (iii), above. Energy brokers, marketers, or other suppliers that market using in-person or door-to-door marketing shall track the phone numbers used for third-party verifications. Third-party verifications used in conjunction with in-person or door-to-door marketing practices are prohibited from using non-fixed voice over internet protocols or phone numbers that cannot otherwise be affiliated with said third-party. Any in-person or door-to-door agent who initiates a sale shall not consummate a sale and shall terminate the interaction if the individual is unable to understand or communicate in the language in which the marketing or solicitation is being conducted.
SECTION 6. Subsection (8) of said section 1F of said chapter 164 of the General Laws, as so appearing, is hereby amended by striking in paragraph (b) the words “30 days” and inserting in place thereof the following:- two years.
SECTION 7. Said subsection (8) of said section 1F of said chapter 164 is hereby further amended in paragraph (d) by striking out the figure “$3,000”, and inserting in place thereof the following:- $5,000.
SECTION 8. Said section 1F of said chapter 164 of the General Laws, as amended by section 78 of chapter 8 of the acts of 2021, is hereby further amended by adding at the end thereof the following 3 new paragraphs:-
(11) For energy brokers, energy marketers, or other suppliers that market to customers using in-person or door-to-door marketing, each agent representing the broker, marketer, or supplier shall wear an identification badge which is visible at all times during the encounter and accurately identifies: (i) such agent’s first name and unique agent identification number; (ii) the energy broker, energy marketer, or supplier that such agent works for; (iii) the company trade name or D/B/A, if different from the energy broker, energy marketer, or supplier name; (iv) the agent’s photograph; and (v) the customer service phone number of the energy broker, energy marketer, or supplier.
(12) For energy brokers, energy marketers, or other suppliers that market to customers using telephone solicitations, each broker, marketer, or supplier agent who initiates a call or who receives an incoming call shall not consummate a sale and shall terminate the interaction if the individual is unable to understand or communicate in the language in which the marketing or solicitation is being conducted.
(13) The department shall establish an office of retail market oversight, herein after referred to as the “office”, to be funded by: the fee established in subparagraph (iii) of paragraph (1) and; an annual assessment of retail suppliers and brokers based on a formula to be determined by the department not to exceed $10,000 annually per licensed entity. The office shall have the power to actively seek input from all interested parties and to develop a thorough understanding and critical analyses of the tools and techniques used to promote retail energy competition in other states. The office shall monitor existing competitive conditions in the commonwealth, identify barriers to retail competition for all customer classes, and actively explore and propose to the department solutions to overcome identified barriers and enhance retail competition. The office shall, in coordination with the office of ratepayer advocacy established in section 11E of chapter 12, publish on a quarterly basis the number of complaints filed against each supplier, and other information deemed relevant by the office. The office shall have the authority to address violations by suppliers through the imposition of a probationary status which may include, but not be limited to, enhanced oversight, additional reporting requirements, and submission for department approval of a plan for any fines or remediation to customers specific to any supplier that violates regulations or any rules subject to this chapter. The office shall report to the department any recommendations for suspension or revocation of a license.
SECTION 9. Chapter 164 of the General Laws, as so appearing, is hereby amended by inserting after section 1K the following section:-
Section 1L. (a) As used in this section, the following words shall, unless the context otherwise requires, have the following meanings:-
“low-income customer,” a retail customer in the commonwealth who is on a residential low-income discount distribution rate as set forth in subsection (4) of section 1F, or participates in a low-income energy assistance program, including, but not limited to, the Low-Income Home Energy Affordability Program or “LIHEAP”.
“residential retail customer,” a retail customer in the commonwealth who is on a residential distribution rate.
(b) Effective January 1, 2023, no supplier shall execute a new contract or renew an existing contract for generation services with any low-income customer. The department shall establish a competitive procurement process for the supply of retail electric service for low-income customers in each utility service territory. The process shall be a retail auction with oversight by the department. The department shall open a proceeding to establish rules for implementing this section within 90 days of the effective days of this act.
(c) As a condition of licensure, or any licensure renewal as of July 1, 2023, under subsection 1 of section 1F of chapter 164, each supplier shall:
(1) not extend a supply agreement with a residential retail customer beyond the agreement’s stated term without providing at least two notices prior to the end of the supply agreement’s stated term;
(2) not charge a termination or early cancellation fee of a contract to a residential retail customer; provided, however, this provision shall not apply to charges or fees for devices, equipment, or other non-commodity services;
(3) not make a material change in the terms or duration of any individual residential contract for the provision of electric generation services by a supplier without providing two disclosure notices to the customer and the options available to the customer ahead of the proposed change;
(4) no less than quarterly, provide to the department: (i) a list detailing each rate the supplier charged to residential retail customers in the last quarter; and (ii) the number of low-income and non-low-income residential retail customers charged each rate included in such list by rate class. The department shall require that suppliers publish at least one publicly available rate from each supplier on the department’s website; and
(5) no less than annually, provide data to the department concerning any renewable energy certificates retired in connection with the generation service provided to individual residential retail customers. Such data shall include the geographic location and fuel type of each such renewable energy certificate, whether each certificate is RPS Class I eligible, pursuant to section 11F of chapter 25A, and the percentage of the supply purchased from Class I generation in excess of the supplier’s annual Class I obligation. The department shall publish this information from each supplier on its website.
(d) No license may be transferred without prior approval by the department. No customer may be assigned or transferred without prior notice to the department. Notice of such customer assignment or customer transfer shall be provided to the department at least thirty days prior to the effective date of the assignment or transfer of a customer from one supplier to another supplier. The department may, upon its review of such notice, require certain conditions or deny assignment or transfer of such customer.
(e) Any violation of the conditions of licensure enumerated in this section shall be penalized pursuant to subsection (7) of section 1F, at no less than $10,000 per violation per day. In addition, the attorney general is hereby authorized to bring an action under section 4 of chapter 93A to enforce the consumer protection provisions of this section and to obtain restitution, civil penalties, injunctive relief and any other relief awarded pursuant to said chapter 93A. Impersonating an employee of a distribution company or misrepresenting the business relationship between the supplier and the distribution company shall be punishable by a fine of not less than $10,000 per incident, in addition to any other remedies that may be otherwise applicable under this chapter or chapter 93A.
(f) No less than quarterly, the department shall publish each supplier’s and electric and gas distribution companies’ complaint data, sourced from complaints made to the department as well as those made to the attorney general, as provided to the department annually, on the department’s website. Such complaint data shall be and shall include, but not be limited to, the total number of complaints received regarding the supplier and verified by the department or the attorney general, the number of complaints received for misleading or false marketing, the number of complaints for unauthorized switching, the number of complaints for Do Not Call list violations, and the number of complaints for aggressive marketing. Complaints shall be represented as a proportion of customers served.