then submitted to the appropriate State agency for review
of consistency with State energy goals.
(h) CONVERGENCE
OF UTILITY SERVICES.—If a
State authorizes retail marketing of combined ‘‘wires’’ or
energy services such as cable television, Internet, natural
gas, electricity, telephone, and other related technologies,
an entity established by consumers through a public proc-
ess shall be allowed to combine any and all services
deemed appropriate for provision to the aggregated con-
sumers.
(i) FEDERAL POWER ACT JURISDICTION.—No local
government that aggregates electric load as described in
subsection (d) shall be considered a utility engaging in the
wholesale purchase and resale of electricity for purposes
of the Federal Power Act. Supplying electricity to aggre-
gated customers within the boundaries of a local govern-
ment shall not be considered a wholesale transaction sub-
ject to the jurisdiction of the Federal Regulatory Commis-
sion under the Federal Power Act.
SEC. 207. WORKER PROTECTIONS.
(a) RECOVERY OF COSTS.—Electric utilities shall be
allowed to recover reasonable employee-related transition
costs incurred and projected for programs that provide for
offers of voluntary severance, job retraining, early retire-
ment, continued health care, outplacement and related
benefits. However, there shall be no recovery for employee-
related transition costs associated with officers and senior
supervisory employees performing predominantly regu-
latory functions.
(b) UNEMPLOYMENT BENEFITS.—States should con-
sider extended unemployment benefits to any employee of
an electric utility company who is terminated through no
fault of his own as a result of electricity deregulation and
is otherwise eligible for unemployment benefits. No such
employee shall be denied or be determined to be ineligible
for any such benefits if the employer has provided notice
of the cessation of employment.
(c) PLAN.—Before any such reduction in the work-
force, an electric utility shall present to its employees and
their representatives a workforce reduction plan outlining
the means by which the electric utility intends to mitigate
the impact of such workforce reduction on its employees.
SEC. 208. LICENSING AND DISCLOSURE REQUIREMENTS
FOR RETAIL SUPPLIERS.
(a) PURPOSE.—The purpose of this section is to es-
tablish the jurisdiction of the State regulatory authority
over retail electricity suppliers and to set forth the condi-
tions under which such suppliers may obtain a license to
sell retail electricity in a State.
(b) LICENSE.—No retail electricity supplier shall en-
gage in the business of the sale, marketing, brokering, or
aggregating for the sale of electricity in a State without
a valid license from the State regulatory authority. All re-
tail electric suppliers who seek to do business in a State
shall file an application with the State regulatory author-
ity that includes the following information:
(1) Legal name.
(2) Business address.
(3) That State where incorporated; date or or-
ganization; copy of the articles of incorporation, as-
sociation or other form of organization.
(4) Names and business address of all officers
and directors, partners; or other similar officials.
(5) Name, title, and telephone number of cus-
tomer service contact person.
(6) Name, title, and telephone number of regu-
latory contact person.
(7) Name, title, and address of registered agent
in this State for service of process.
(8) Description of the nature of the business to
be conducted, a map showing the geographic area of
the supplier’s intended marketing area, and a list of
any restrictions on the type or number of customers
the supplier will seek to serve.
(9) Evidence of the supplier’s right, title, or in-
terest in generation supplies sufficient to meet the
existing and projected demands of its customers.
(10) A copy of the standard contract proposed
to be used by the supplier for residential and small
commercial customers.
(11) Whether the applicant or any member of
its board of directors or officers have been or are the
subject of State or Federal investigation, license rev-
ocation or lawsuit, and, if so, the identification of
such States and proceedings.
(12) Proof of holding a bond or other evidence
of insurance approved by the State regulatory au-
thority in the amount reflecting number of cus-
tomers served and the amount of electricity sold.
The bond must be updated annually on the anniver-
sary of the approval of the license, based on the sup-
plier’s average number of customers and the amount
of electricity sold. The bond shall carry an endorse-
ment that shall allow the issuer of the bond or in-
surer to pay such amounts and in such a manner as
ordered by the State regulatory authority upon a
finding of fraudulent conduct toward consumers, ac-
tions which cause the electricity supply system to be-
come unreliable, revocation of the supplier’s license,
abandonment by the supplier, or, upon complaint, a
failure to comply with the settlement’s contract with
the distributor. The State regulatory authority may
order the bond proceeds to be paid to customers as
restitution for fraudulent conduct, violation of State
law or State regulatory authority rule, or to other
individuals adversely affected by the supplier’s con-
duct.
(c) APPROVAL.—The application shall be deemed ap-
proved after 90 days, unless the State regulatory authority
initiates an adjudicatory proceeding by public notice that
states the reason(s) why there is reason to believe that
the application should be denied. The applicant shall have
an opportunity to correct any deficiency noted by the State
regulatory authority in writing or request a public hearing.
A failure to comply with the application requirements or
evidence that indicates a pattern of violation of State or
Federal consumer protection laws and rules, including
antitrust laws and securities rules, shall be sufficient to
deny an application. A license shall remain valid for a pe-
riod of five years unless sooner revoked.
(d) CHARGES.—After a license is issued, a retail elec-
tricity supplier must inform the State regulatory authority
in writing of any substantial change in the information
submitted to obtain a license from the State regulatory
authority within ten days of the event. The failure to pro-
vide such information in a timely manner shall be grounds
for revocation of the license.
(e) REVOCATION.—The State regulatory authority
may revoke a license for the retail sale of electricity for
cause after opportunity for public hearing. The State reg-
ulatory authority may issue an order that prevents a sup-
plier from marketing or signing up new customers during
the pendency of an investigation or revocation proceedings
when it finds that there is probable cause to believe that
consumers will be harmed or that the reliability of the elec-
tricity supply of a State will be harmed by the actions of
the supplier.
(f) OBLIGATIONS TO DISTRIBUTION COMPANIES.—A
retail electricity supplier shall enter into a contract with
each distributor that services its customers. The contract
shall describe the billing arrangements between the dis-
tributor and the supplier, how information concerning cus-
tomer status will be transmitted between the two entities,
whether and under what conditions upstream metering
will occur to facilitate settlements of nonhourly metered
customers and other settlement issues. The contract shall
be filed with the State regulatory authority by the retail
electric supplier prior to the commencement of business
by the supplier in this State.
(g) DISCLOSURE
OF UNIVERSAL SERVICE PRO-
GRAMS.—A retail electric supplier shall inform every pro-
spective customer of the availability of universal service
programs for qualified customers and how customers can
apply for such programs. A summary of such programs
shall be provided in writing within ten days of commence-
ment of service for residential customers.
(h) STATE REGULATORY AUTHORITY ACCESS
TO
BOOKS
AND RECORDS; INVESTIGATIONS; FINES.—The
State regulatory authority shall have access to a retail
electric supplier’s books and records concerning its busi-
ness within this State upon reasonable notice in order to
investigate, upon reasonable cause, any alleged violation
of this Act. The supplier shall make such books and
records available to the State regulatory authority within
this State at a location convenient to both parties. Upon
reasonable cause, the State regulatory authority may ini-
tiate an investigation of the supplier’s business in this
State for the purpose of determining compliance with any
provision of this Act. Upon initiating such investigation,
the State regulatory authority shall notify the supplier and
other interested parties and take such steps as are nec-
essary and proper to protect the confidentiality of infor-
mation obtained from suppliers that would unfairly impact
the supplier’s ability to attract future sales of electricity
in this State. The State regulatory authority shall offer
the supplier an opportunity to respond and request a pub-
lic hearing. Upon a finding that the supplier has violated
one or more provisions of this Act, the State regulatory
authority may issue such orders as necessary, pursue a
revocation of the supplier’s license, order restitution to
specific customers, and assess fines according to section
216 of this Act.
SEC. 209. REGULATION OF DISTRIBUTION COMPANIES.
(a) DISTRIBUTION SYSTEM.—The distributor shall be
required to retain its monopoly role with respect to the
construction and maintenance of the distribution system
for all customers, installation of service and meter read-
ing, billing of customers for distribution and transmission
services, and provision of optional billing services under
contract with retail electricity suppliers. The distributor
shall provide access to the electric grid in a nondiscrim-
inatory manner to customers, be subjected to regulation
of the State regulatory authority for prices and the quality
of its customer service, and undertake such additional ob-
ligations with respect to energy efficiency and universal
access services as determined by the State regulatory au-
thority. The purpose of this subsection is to supplement
existing law and, where appropriate, substitute rights and
obligations for distribution companies in an electricity
market characterized by retail deregulation.
(b) 
UNBUNDLED
RATES.—A 
distributor 
shall
unbundle or separate its charges for distribution and
transmission services into the following components:
(1) Transmission services.
(2) Distribution services, which shall include
the costs associated with universal service programs
and energy efficiency programs or expenses author-
ized by the State regulatory authority, bad debt and
other expenses associated with consumer protection
provisions.
(3) Charges for electricity supplied by a retail
electricity supplier or basic service arranged by the
distributor.
(c) CUSTOMER RIGHT OF ACCESS; DUTY OF DIS-
TRIBUTOR.—A distributor shall provide access to the elec-
tric grid in a nondiscriminatory manner to any person
upon request. Any condition imposed by the distributor
prior to providing access shall be contained in the com-
pany’s terms and conditions subject to review by the State
regulatory authority. The procedures adopted by the dis-
tributor to provide access to retail electric suppliers shall
include the following requirements:
(1) A distributor must offer to enter into an
agreement to govern metering, meter reading, trans-
mittal of billing information or billing services, and
settlement of accounts with any retail electric sup-
plier licensed by the State regulatory authority. The
retail supplier shall provide at least two weeks notice
to the distributor of its intent to do business in the
service territory of the distributor. The agreement
between the distributor and the retail electric sup-
plier must incorporate the provisions relating to the
funding and delivery of basic service programs; im-
plementation of the State regulatory authority’s re-
quirements relating to credit and collection; bill noti-
fication and disclosure requirements; and notifica-
tion between customers, suppliers, and the dis-
tributor of intent to change suppliers or obtain re-
connection and disconnection services. A copy of the
agreement shall be filed with the State regulatory
authority but shall not require State regulatory au-
thority approval.
(2) No distributor shall discriminate against or
show favor toward any retail electric suppliers in its
communications or in its course of conduct with cus-
tomers or retail electric suppliers.
SEC. 210. CHANGE OF SUPPLIER.
(a) IN GENERAL.—A customer may change his or her
electric supplier at any time, subject to any penalty set
forth in the contract with the supplier. The distributor
may charge a reasonable fee to make a change in the cus-
tomer’s supplier to reflect the actual cost to read the cus-
tomer’s meter and make changes in its billing records, ex-
cept that every customer may seek to obtain basic service
as described in section 205 without charge. When a fee
is applicable, the distributor shall offer the customer the
option to self-read the meter or provide a timely meter
reading at a lower cost.
(b) NOTIFICATION.—Except for the automatic provi-
sion of basic service, a distributor shall not change the
identity of the customer’s supplier if there is any reason
to believe that the notification procedures of section 213
have been violated. Instead, the distributor shall take im-
mediate steps to attempt to communicate directly with the
customer.
(c) NOTICE PERIOD.—A distributor may adopt a rea-
sonable notice period to effectuate a customer’s change of
supplier, but this notice period shall not be greater than
three business days. The distributor shall read the cus-
tomer’s meter or obtain a self-reading from the customer
prior to recording a change in the customer’s supplier.
(d) METER.—Any change in the customer’s supplier
shall take effect at the time of the meter reading by the
distributor, or, if an actual meter reading is not possible
after reasonable efforts to obtain an actual or customer-
supplied reading by the distributor, on midnight of the day
that the change is implemented by the distributor in its
records.
SEC. 211. DISTRIBUTION SERVICE DISCONNECTIONS AND
SUPPLY TERMINATIONS.
(a) DISCONNECTION.—All customers shall be pro-
tected from unreasonable distribution service disconnec-
tions and unreasonable supply terminations.
(b) DEFINITION.—Unreasonable distribution service
disconnection includes, without limitation, disconnection
from access—
(1) for failure to pay a seller other than the
seller of basic service; or
(2) in the case of qualified low-income house-
holds receiving basic service, before they—
(A) have been referred to social service
agencies that can provide them with assistance;
and
(B) have failed to pay under an extended
payment agreement; or
(3) when such disconnection would be dan-
gerous to the health or safety of a member of the
household, including during the presence of infants,
elders, disabled persons, and during risk of extreme
weather conditions. For the purposes of this section,
the term ‘‘infant’’ means any child under six years
of age, the term ‘‘elder’’ means any person 60 years
of age or older, and the term ‘‘disabled person’’ has
the same meaning as provided in the Americans with
Disabilities Act; or
(4) without contacting a third party designated
by such household to receive notice of proposed serv-
ice disconnection.
(c) PROHIBITION.—A seller shall not disconnect or
threaten to disconnect the customer’s electric service or
to terminate the customer’s electricity supply for failure
to pay for products or services other than electricity.
(d) PROTECTION.—All customers shall be protected
from unreasonable supply termination, including without
limitation—
(1) termination before adequate notice is pro-
vided of the supplier’s intent to terminate, and of
the right to continue service via another supplier
provider or through basic service; or
(2) when used as a mechanism for bill collection
or during the pendency of a dispute regarding bill
amount.
(e) NOTICE.—A supplier may discontinue services to
a customer who fails to pay or make a reasonable payment
arrangement for an overdue amount in excess of $50 by
giving notice to both the customer and the distributor. The
notice shall be in writing and conspicuously disclose the
amount overdue, what the customer must do to avoid dis-
continuance of service, how the customer can contact the
supplier to negotiate terms to avoid disconnection, and
how the customer can obtain basic service in place of fur-
ther service from the supplier. The notice shall be mailed
or delivered at least ten weekdays prior to disconnection
of service. Once the due date has passed, the supplier may
notify the distributor who shall change the customer’s sup-
plier upon proper notice from the customer or initiate
basic service within three business days. The supplier’s ob-
ligation to the distributor or network operator shall cease
with the disconnection of service by the distributor, the
initiation of basic service or the commencement of service
to the customer by a different supplier, whichever comes
first.
(f) TENANTS.—A tenant whose landlord fails to pay
for electric service shall not be disconnected from distribu-
tion service or from electricity supply. Where metering fa-
cilities exist, the tenant shall be offered an opportunity
to put service, including basic service, in his or her name.
In addition to any other remedy authorized by law, a retail
supplier and distributor may file a lien on the property
of any owner of a multi-unit, single-metered building for
failure to pay for electricity services. This lien shall be
filed in the same manner and perfected with the same pro-
cedures as those available to towns and cities for the col-
lection of unpaid property taxes and sewer charges.
(g) PHYSICIANS.—The distributor shall notify all its
customers of the right to have a registered physician de-
clare a medical emergency in the household and avoid dis-
connection for a period not to exceed 90 days. If a dis-
tributor receives such a declaration, it shall promptly no-
tify the customer’s supplier. Upon receipt of a declaration
of medical emergency, a retail supplier shall not dis-
connect the customer. During this time period the cus-
tomer may request basic service or continue with service
from his or her retail supplier. During this time period
the customer may not be threatened with disconnection
and the supplier and distributor shall accept less than pay-
ment in full. The customer shall remain liable for all un-
paid amounts. At the end of a maximum period of 90
days, the customer shall either resume regular payments
or pay the overdue amount in full to avoid disconnection.
SEC. 212. CREDIT AND COLLECTION PRACTICES.
(a) STATE REGULATIONS.—A State authority’s cur-
rent credit and collection regulations shall remain in effect
to govern the actions of a distributor with regard to basic
service and the billing and collection of distribution and
transmission services provided by the distributor and other
companies.
(b) BILLING AND COLLECTION.—The following pro-
visions apply to the billing and collection for the sales of
electricity by retail suppliers and the billing and collection
for sales of electricity by distributors under contract with
suppliers:
(1) A distributor that offers to bill for suppliers
shall allocate a customer’s partial payment first to
services regulated by the State regulatory authority,
including without limitation, distribution and trans-
mission services, and then to the unregulated portion
of the bill. For purposes of this paragraph, the term
‘‘services regulated by the State regulatory author-
ity’’ includes energy management and efficiency
services provided to the customer pursuant to an
order of a State regulatory authority and billed by
the distributor.
(2) A retail supplier shall not refuse to grant
credit to any applicant based on a prohibited basis
contained in the Federal Equal Credit Opportunity
Act, 15 U.S.C. 1691–1691f.
(3) Any deposit required by a retail supplier
shall not exceed the applicant’s estimated bill for a
two-month period. The State regulatory authority
may waive the supplier’s right to a deposit in any
case in which it finds that the supplier has discrimi-
nated in its request for a deposit from an applicant.
The State regulatory authority may take into ac-
count the supplier’s written credit and collection pro-
cedures and their application in making this deci-
sion. A request for a deposit shall be in writing and
inform the applicant of the reason for the request,
the source of the information that led to the request,
the amount, the applicant’s payment options, and
how the applicant can have the deposit refunded.
(4) A retail supplier may charge a late fee if a
customer’s payment is paid after the due date on the
customer’s bill. The amount of the late fee shall not
exceed customary business practice for consumer
goods.
SEC. 213. UNFAIR TRADE PRACTICES.
The following specific practices shall be prohibited:
(1) CRAMMING
AND
SLAMMING.—No electric
utility, distributor, supplier, or any person, firm,
corporation, or governmental entity shall make any
change to the number of products or services offered
(cramming) or authorize a different supplier for any
residential or small commercial customer (slamming)
until the change has been confirmed by an inde-
pendent third-party verification company, as follows:
(A) The third-party verification company
shall meet each of the following criteria:
(i) Be independent from the entity
that seeks to provide the new service.
(ii) Not be directly or indirectly man-
aged, controlled, directed, or owned, wholly
or in part, by an entity that seeks to pro-
vide the new service or by any corporation,
firm, or person who directly or indirectly
manages, controls, or directs or owns more
than 5 percent of the entity.
(iii) Operate from facilities physically
separate from those of the entity that
seeks to provide the new service.
(iv) Not derive commissions or com-
pensation based upon the number of sales
confirmed.
(B) The entity seeking to verify the sale
shall do so by connecting the customer by tele-
phone to the third-party verification company
or by arranging for the third-party verification
company to call the customer to confirm the
sale.
(C) The third-party verification company
shall obtain the resident’s oral confirmation re-
garding the change and shall record that con-
firmation by obtaining appropriate verification
data. The record shall be available to the cus-
tomer upon request. Information obtained from
the customer through confirmation shall not be
used for marketing purposes. Any unauthorized
release of this information is grounds for a civil
suit by the aggrieved customer against the enti-
ty or its employees who are responsible for the
violation.
(D) Notwithstanding subparagraphs (A),
(B), and (C), a supplier shall not be required
to comply with these provisions when the cus-
tomer directly calls the supplier to make
changes in products, services, or suppliers.
However, a supplier shall not avoid the
verification requirements by asking a customer
to contact a supplier directly to make any
change in products, services, or the supplier. A
supplier shall be required to comply with these
verification requirements for its own products
or services. However, a supplier shall not be re-
quired to perform any verification requirements
for any changes solicited by another supplier.
(2) GIFTS.—A supplier shall not provide a gift
or inducement to a residential or small commercial
customer with a value in excess of $50 or provide
any gift or inducement more than once per 12-
month period to the same household or small busi-
ness.
(3) ADVERTISING.—A supplier shall not adver-
tise or disclose the price of electricity in such a man-
ner as to mislead a reasonable person into believing
that this portion of the bill will be the total bill
amount for the delivery of electricity to the cus-
tomer’s location. When advertising or disclosing the
price for electricity, the supplier shall also disclose
the distributor’s average current charges (including
transmission charges) for that customer class as ap-
proved by the State regulatory authority.
(4) CANCELLATION.—In addition to any other
right to revoke an offer, residential and small com-
mercial customers have the right to cancel a con-
tract without fee or penalty for electric service until
midnight of the twentieth business day after the day
on which the buyer receives a written confirmation
of the agreement to purchase such service. Cancella-
tion occurs when the buyer gives written notice of
cancellation to the seller at the address specified in
the agreement or offer. Notice of cancellation, if
given by mail, is effective when deposited in the mail
properly addressed with postage prepaid. Notice of
cancellation given by the buyer need not take the
particular form as provided with the contract or
offer to purchase and, however expressed, is effective
if it indicates the intention of the buyer not to be
bound by the contract.
SEC. 214. METERS.
(a) STANDARD METERS.—A distributor shall con-
tinue its obligation to furnish a standard meter to any
residential and small commercial applicant for service at
a previously unserved location without separate charge.
(b) INSTALLATION OF DIFFERENT METERS.—A cus-
tomer may install a different meter if it meets the tech-
nical qualifications and installation specifications estab-
lished by the distributor. The distributor may adopt rea-
sonable procedures to assure compliance with its technical
100
qualifications and installation specifications and shall in-
form its customers of these requirements promptly upon
request.
(c) PRICE VARIATIONS.—A supplier may vary the
price of electricity based on the type and capacity of the
installed meter to record hourly or seasonal prices. A sup-
plier’s terms may include a requirement that a customer
with a nonhourly meter pay a separate fee or penalty if
the customer cancels a contract during certain times of
the year or without specified notice to the supplier.
(d) SALE OR LEASE OF DIFFERENT METERS.—A
supplier may offer to sell or lease a different meter and
to bill and collect separately for the meter on the electric
bill issued by a supplier or distributor.
(e) LOAD CURVES.—As a condition of offering elec-
tricity for sale within a territory served by a distributor,
a supplier must enter into an agreement with the party
responsible for settlement of network operations. These
agreements must allow for the use of average load shape
curves to bill and pay for the use of electricity by cus-
tomers without hourly-metered consumption. The average
curves shall be calculated at least four times per calendar
year for each supplier’s customers without hourly meters.
(f) PAYMENT PRIOR TO DELIVERY.—It shall be un-
lawful to use or to require the use of a prepayment meter,
101
service limiter, or other device or program that requires
cash payment prior to the delivery of the service.
SEC. 215. EXEMPTION RESCINDED FROM EQUAL CREDIT
OPPORTUNITY ACT.
The regulations implementing the Equal Credit Op-
portunity Act (15 U.S.C sections 1691–1691(f)) exempt-
ing regulated utilities from application of certain provi-
sions of that Act, shall not apply to transactions con-
cerning the sale of services in a deregulated market.
SEC. 216. CONSUMER REMEDIES.
(a) IN GENERAL.—A consumer damaged by a viola-
tion of this section by an entity offering retail electricity
service is entitled to recover all of the following:
(1) Actual damages.
(2) The consumer’s attorney’s fees and court
costs.
(3) Exemplary damages, in the amount the
court deems proper, for intentional or willful viola-
tions.
(4) Equitable relief as the court deems proper.
(b) OTHER RIGHTS.—The rights, remedies and pen-
alties established by this section are in addition to the
rights, remedies or penalties established under any other
law.
Æ