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NATIONAL ASSOCIATION OF STATE UTILITY CONSUMER ADVOCATES
RESOLUTION
Urging the Adoption of Standards to Protect Consumers
as Part of Any Electric Restructuring Legislation or Regulations
WHEREAS, reliable and affordable electric service is a basic necessity
of modern life;
WHEREAS state utility commissions have traditionally exercised
authority over pricing and reliability of retail electric power
supply and delivery by public utilities and have developed a comprehensive
framework of consumer protections through regulations and policies;
WHEREAS, the Federal Energy Regulatory Commission has recently
adopted policies introducing competition into some aspects of the
electricity marketplace;
WHEREAS, numerous State legislatures and public utility commissions
have adopted or are considering the adoption of policies which would
unbundle retail electric services, open power supply and other services
to a competitive marketplace, and continue or modify the regulation
of delivery services by monopoly public utilities;
WHEREAS, if the electric industry is restructed, electric customers
may be faced with a variety of vendor choices with regard to the
purchase of power supply and other electric services;
WHEREAS, it is expected that activities of power suppliers, marketers,
and brokers (together, "third-party providers") and marketing
activities of incumbent electric utilities or their affiliates will
increase significantly as unbundling of retail electric services
occurs, and as the availability of electric purchase options increases
from third parties;
WHEREAS, existing state utilities regulations and consumer protection
laws may not provide adequate consumer protections addressing the
selling activities of third-party providers and the activities of
incumbent electric utilities or their affiliates after restructuring;
WHEREAS, there will be a need for mechanisms to investigate and
enforce compliance with consumer protection requirements, and for
reasonable dispute resolution of consumer complaints by a neutral
third party;
WHEREAS, it is anticipated that as the unbundling of electric services
occurs, and third-partyproviders solicit service contracts from
customers, customers may be subject to unfair, deceptive, unconscionable,
or anti-competitive practices with regard to power supply and other
service contracts;
WHEREAS, third-party providers may require access to customer usage
and related information to effectively market to and serve retail
customers, yet at the same time, consumers should be able to establish
their rights to privacy about specific customer information;
WHEREAS, minimum standards are needed to assure reasonable billing
and business practices, and reliable and safe service from third
party providers;
WHEREAS, accurate consumer informational and educational materials
are needed so customers can understand their choices and the terms
of services offered;
WHEREAS, unfair or deceptive business practices, anticompetitive
acts, privacy concerns, informational needs and reliability needs
may be issues of particular importance to residential and small
business electricity customers;
WHEREAS, effective consumer protections will promote public confidence
in the competitive retail electric marketplace; and
WHEREAS, effective consumer protections will increase the efficiency
of a competitive retail electricity marketplace, as they do in other
competitive retail markets;
THEREFORE, BE IT RESOLVED, that NASUCA supports the establishment
of appropriate and adequate consumer safeguards to protect customers
during any transition to and the operation of any restructured retail
electricity marketplace;
BE IT FURTHER RESOLVED, that NASUCA believes such safeguards should
include at least the following requirements:
Consumer information and education:
a. A comprehensive consumer education and outreach program should
be carried out to minimize public confusion and provide information
so consumers are able to make informed choices and participate effectively
in a restructured electric market.
b. Plain language providing full and verifiable information must
be presented to consumers by competitive providers of electric service
in writing, using uniform words and phrases having the same meanings,
before any contract or agreement for service may be entered into,
so that customers may make accurate comparisons among providers
as to price, duration of contract, quantities, and other material
terms;
Benefits to all consumers:
c. So that all consumers benefit from restructuring, utility service
must be available to all customers under terms and conditions and
at rates at least as attractive as those found just and reasonable
prior to any implementation of retail competition and access should
be afforded to a default provider at a reasonable price in situations
where no alternative provider offers an economically attractive
price to customers in a particular geographical area or customers
with particular usage levels or credit histories or if the customers
do not choose a provider, and in other circumstances;
Protection from undue discrimination:
d. Means to prevent undue discrimination by electric service vendors
and utilities against certain residential customers or customer
groups because of differences in income or other personal or household
characteristics, and to prohibit undue discrimination among otherwise
similar customers with regard to prices, access to service, credit
and collection policies, and customer service;
Service reliability:
e. Certification, registration, and bonding requirements to assure
that third party providers have the necessary financial and technical
resources and commitments to meet business and customer obligations
and to assure the provision of reliable and safe service;
f. Provisions to ensure continuity of service at a reasonable price
if the customer's provider suddenly ceases operations;
Enforcement and complaint resolution:
g. Mechanisms to investigate and enforce compliance with consumer
protection requirements and for customer access to a reasonable
dispute resolution mechanism administered by a neutral party;
Privacy:
h. Appropriate maintenance of privacy of confidential custom account
information;
Code of conduct for third-party providers and affiliated utility
vendors:
i. Standards for what a provider is permitted to demand as a deposit
or late payment fee;
j. A minimum notice period prior to discontinuation of supply service,
and special procedures to be followed during extreme weather periods
and if the customer is elderly or disabled;
k. Prompt resumption of electrical supply at a reasonable price
after the customer pays an outstanding bill or enters into a reasonable
payment plan;
l. A reasonable limitation on back-billing;
m. Prohibitions against and procedures to correct the unauthorized
transfer of service from one service provider to another and the
unauthorized provision of additional services, practices known in
the telephone marketplace as "slamming" and "loading";
and
n. Prohibitions against unfair, deceptive, or unconscionable business
practices by any provider, including but not limited to advertising
on the basis of false or misleading statements regarding environmental
impacts or resource mix;
BE IT FURTHER RESOLVED, that NASUCA calls upon legislative and regulatory
authorities to enact policies and safeguards in any restructured
electric power market that fully protect consumers;
BE IT FURTHER RESOLVED, that NASUCA calls upon legislative and
regulatory authorities to take steps to prevent fraudulent or deceptive
business practices in any restructured electric power market and
to prosecute providers that violate state and federal consumer protection
laws;
BE IT FURTHER RESOLVED, that NASUCA calls upon legislative and
regulatory authorities to ensure that appropriate state offices
including state consumer advocate offices have adequate authority
and resources to protect consumers; and
BE IT FURTHER RESOLVED, that NASUCA authorizes its Executive Committee
to develop specific positions and to take appropriate actions consistent
with the terms of this resolution. The Executive Committee shall
advise the membership of any proposed action prior to taking action
if possible. In any event the Executive Committee shall notify the
membership of any action pursuant to this resolution.
Approved by NASUCA
Charleston, South Carolina
Place
June 11, 1997
Date
Submitted by:
NASUCA Electricity Committee
Larry Frimerman (OH), Chair
Rajnish Barua (DE)
Anne Becker (IN)
Barry Cohen (OH)
Nancy Vaughn Coombs (SC)
Steve Corneli (MN)
Anne Curtin (NY)
George Dean (MA)
Jennifer Duane (DC)
William Fields (MD)
Margaret Force (NC)
Walker Hendrix (KS)
Bruce Johnson (CT)
Robert Kelter (IL)
Lewis Mills (MO)
Thomas Nicholson (VA)
Charles Noble (NM)
Gerry Norlander (NY)
Mark Payne (NC)
William Perkins (ME)
Blossom Peretz (NJ)
Irwin Popowsky (PA)
Fred Schmidt (NV)
Lynda Spears (IN)
Ben Stead (IA)
Kenneth Traum (NH)
National Association of State Utility Consumer Advocates
8380 Colesville Road, Suite 101, Silver Spring, MD 20910
Phone: (301) 589-6313 Fax: 589-6380
e-mail: nasuca@nasuca.org |