HMS Legal Blog

On March 31, 2021, the Public Service Commission of Maryland (Commission) issued Order No. 89795 which proposed to drastically re-write the Maryland Telephone Solicitations Act (MTSA) and, if permitted to stand, may fundamentally change the way business is conducted in the state. In Order 89795, the Commission was resolving a complaint filed by Commission staff against SmartEnergy, a Maryland retail energy supplier. The complaint alleged that SmartEnergy engaged in false and misleading advertising in connection with a mailing solicitation campaign that resulted in consumers calling SmartEnergy to sign up for the service advertised in the mailed postcards, and then subsequently becoming disgruntled with the service or the terms. Ultimately, the Commission found SmartEnergy had violated the MTSA and imposed penalties and sanctions, but Order 89795’s re-writing of the MTSA has much broader implications than just the issues and interests alleged in the complaint.

            The Pennsylvania Public Utility Commission opened a docket[1] this year to examine whether it should encourage or require supplier consolidated billing (“SCB”)[2].  SCB is when competitive energy suppliers, rather than the utility, bill the customer for all the services associated with their energy supply, including the utility’s distribution charges – sort of the opposite of how it happens today.  The reason I suggest that SCB is “sort of” the opposite of how things are done at present, is that when utilities bill and collect for suppliers now, they normally do so under a program called “purchase of receivables” or (“POR”) where the utility bills and collects from the customer and pays the supplier – regardless of whether the customer pays the utility.  The supplier pays a fee for this benefit equal to the utility’s bad debt percentage, which is known as the “POR discount”. For example, if a utility can’t collect 4% of what it charges to customers as a group, suppliers only get 96 cents on the dollar for the product they sell, even if the utility collects a larger percentage of charges to the supplier’s customers, which is often the case.  However, under the proposed SCB, the supplier would be required to remit 100% of charges back to the utility and manage the entire risk of uncollectible debts on its own.

            In Sunrise Energy v. FirstEnergy Corp. and West Penn Power Company,[1] the Pennsylvania Commonwealth Court affirmed the lower court’s ruling, in a 5-2 decision, that the Pennsylvania Public Utility Commission does not have primary, let alone exclusive, authority to adjudicate claims arising under the Alternative Energy Portfolio Standards Act[2] (“AEPS”) because the General Assembly failed to delegate such authority to the Commission.

            The Pennsylvania Public Utility Commission (PUC) recently issued a final rule making order concerning recovery of fuel costs by gas utilities at Docket No. L-2013-2346923.  The full order can be found here:  http://www.pabulletin.com/secure/data/vol46/46-4/110.html  The Order is designed to simplify and streamline information and procedures for small gas utilities (gross intrastate operating revenues of $40 million or less) when submitting gas cost rate (GCR) filings with the PUC. 

On February 18, 2016, EPA Announced its Triennial National Enforcement Initiatives (“Initiatives”).  The EPA issues these Initiatives once every three years in order to help “focus time and resources on national pollution problems” according to Cynthia Giles, assistant administrator for enforcement and compliance assurance at EPA.  The latest round of Initiatives will begin on October 1, 2016 and once again will list natural gas producers and water authorities as targets for EPA inspections and enforcement.

As the PA PUC embarks on its investigation of the natural gas markets, what evidence can we discern about how the agency sees competitive energy markets and how those markets should evolve?

On December 15, 2011 the PUC issued two orders designed to make Pennsylvania’s retail electricity market fully competitive. Both orders are a product of the PUC’s ongoing Investigation of Pennsylvania’s Retail Electricity Market (“RMI”), Docket No. I-2011-2237952. The first order (“RMI Final Order”) addresses the desired features of soon-to-be-filed electric utility default service plans and programs that will be implemented as part of those plans. The second order (“RMI Work Plan Order”) provides granular detail on specific components, including consumer education, accelerating of switching time frames, customer referral programs, and retail opt-in auctions.

The first product of the PUC’s Retail Markets Investigation is expected in the form of a Tentative Order to be voted on at the PUC’s October 13, 2011 Public Meeting, and will address the Electric Distribution Company (“EDC”) Default Service Plans for June 1, 2013 and beyond.

After only a few months of collecting the newly increased rates from its 2010 Rate Case, Columbia Gas of Pennsylvania is back before the Pennsylvania Public Utility Commission seeking an additional $37.8 million in annual revenue.

Today, in split vote, the PUC approved new regulations intended to level the playing field for natural gas competition.