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December 29, 2016 in general by

NJ BPU Formally Proposes Supplier Rules Concerning Faster Switching Times for Gas and Electric Customers, New Contract Summary Guidelines, and Customer Acquisition

As anticipated, the New Jersey Board of Public Utilities (“BPU”) formally proposed rules concerning Third Party Suppliers (“TPS”) amending current regulations. The rules, which were published in the December 5, 2016 New Jersey Register, mark the first significant changes for suppliers since the Polar Vortex, including implementing reduced switching times and improved Government Energy Aggregation Programs (“GEAPs”). The proposed rules will also implement legislation signed into law in December 2015 (A3851/S2018), requiring third party suppliers to provide contract summaries, with specific information and formatting requirements, to customers. Interested parties have until February 3, 2017 to file comments.

Faster Switching Times, Customer Notice, and Billing

Most notably, the proposed rules will result in improved switching times for both electric and gas customers. For electric customers that request to switch suppliers at least 13 days prior to their next scheduled meter read date, the switch will occur on the next meter read date.  For gas customers, such request must be received at least 10 calendar days prior to the next meter read date.

The proposal will also require TPSs transferring customers to another supplier to provide customers with at least 30 days’ notice prior to the switch and to true-up budget billing accounts at least once every 12 months.

Residential and Small Commercial Contract Summaries

In September 2014, the Board ordered all TPSs to provide residential customers with a contract summary upon commencement of service or a renewal. As noted above, in December 2015, legislation was signed into law to require that TPSs shall not provide service without providing a contract summary; the proposed amendments would codify into regulations both the 2014 Order and the 2015 law.  However, the proposed regulations would also require the inclusion of the customer’s name and address at the top of every contract summary, which seems unnecessary. The rule proposal would further eliminate the use of joint electric and gas summaries and require an individual contract summary for each type of service.

Emailing Contracts

Under currently rules, TPSs are required provide their customers with a copy of the contract on or before the date it submits the change order to the LDC. The proposed rule now explicitly authorizes TPSs to send contracts to customers via email, which is a positive development.

Transfer of a Residential Contract

The proposed rules also include a new section concerning the acquisition of customers.  Note that the rules do not address change in TPS ownership; rather, they apply only where the TPS provider changes.  Under the proposal, where a TPS purchases another TPS, the accounts of another TPS, or the TPS accounts are otherwise transferred to an affiliate company, the acquiring TPS must notify the customer of the transfer in writing at least 30 days prior to the effective date of the customer switch. Such notice must also advise that the new TPS will serve the customer under the same terms and conditions, and that the customer may choose another supplier or return to the local distribution company (“LDC”) prior to the transfer. The regulations also provide that in the event a TPS ceases operations and does not transfer its residential contracts to another TPS, the TPS shall notify its customers, at least 30 days in advance, that it will be switched to the LDC, along with a timetable to choose another supplier before being switched to the LDC.

Government Energy Aggregation Programs

Staff also recommended amendments to GEAP rules, developed with stakeholder input and Staff experience with programs’ current operation.  According to Staff, the amended regulations would reduce unintended customer drops, improve the accuracy of customer information and notification, ensure that customers are provided with sufficient information about GEAPs, ensure consumer protection, and clarify the way new customers are added, among other changes.

For more information, contact Grace Strom Power, Esq., Partner in the Feller Law Group Princeton office at 908-510-4130 or at