|(a) Applicability. The requirements of this section
apply to retail electric providers (REPs) in connection with the provision
of service and marketing to residential and small commercial customers.
When specifically stated, the requirements of this section apply to
brokers, aggregators, and transmission and distribution utilities
(TDUs). The requirements for an additional notice to residential customers
of contract expiration is effective for contracts entered into on
or after September 1, 2021. REPs must comply with the requirements
set forth in §25.475(e)(2)(B)(ii), (e)(2)(C)(iii), (v), (vi),
(vii), (h)(4), (h)(6)(C), and the requirements set forth under §25.475(e)(1)
for contracts entered into with small commercial customers by April
1, 2022. Contracts entered into prior to the effective date of these
provisions must comply with the provisions of this section in effect
at the time the contracts were executed.
(b) Definitions. The definitions set forth in §25.5
(relating to Definitions) and §25.471(d) (relating to General
Provisions of Customer Protection Rules) of this title apply to this
section. In addition, the following words and terms, when used in
this section have the following meanings, unless the context indicates
(1) Contract--The terms of service document, the Electricity
Facts Label (EFL), Your Rights as a Customer document (YRAC), and
the documentation of enrollment pursuant to §25.474 of this title
(relating to Selection of Retail Electric Provider), and, if applicable,
Prepaid Disclosure Statement (PDS).
(2) Contract documents--The terms of service, EFL,
YRAC, and, if applicable, PDS.
(3) Contract expiration--The time when the initial
term contract is completed. A new contract is initiated when the customer
begins receiving service pursuant to the new EFL.
(4) Contract term--The time period the contract is
(5) Fixed rate product--A retail electric product with
a term of at least three months for which the price (including all
recurring charges and ancillary service charges) for each billing
period of the contract term is the same throughout the contract term,
except that the price may vary from the disclosed amount solely to
reflect actual changes in TDU charges, changes to the Electric Reliability
Council of Texas (ERCOT) or Texas Regional Entity, Inc. administrative
fees charged to loads or changes resulting from federal, state or
local laws that impose new or modified fees or costs on a REP that
are beyond the REP's control. The price may not vary from the disclosed
amount to reflect changes in ancillary service charges unless the
commission expressly designates a specific type of ancillary service
product as incurring charges beyond the REP's control for a customer's
(6) Indexed product--A retail electric product for
which the price, including recurring charges, can vary according to
a pre-defined pricing formula that is based on publicly available
indices or information and is disclosed to the customer, and to reflect
actual changes in TDU charges, changes to the ERCOT or Texas Regional
Entity administrative fees charged to loads or changes resulting from
federal, state or local laws or regulatory actions that impose new
or modified fees or costs on a REP that are beyond the REPs control.
An indexed product may be for a term of three months or more, or may
be a month-to-month contract.
(7) Month-to-month contract--A contract with a term
of 31 days or less. A month-to-month contract may not contain a termination
fee or penalty.
(8) Price--The cost for a retail electric product that
includes all recurring charges, including the cost of ancillary services,
excluding state and local sales taxes, and reimbursement for the state
miscellaneous gross receipts tax.
(9) Recurring charge--A charge for a retail electric
product that is expected to appear on a customer's bill in every billing
period or appear in three or more billing periods in a twelve month
period. A charge is not considered recurring if it will be billed
by the TDU and passed on to the customer and will either not be applied
to all customers of that class within the TDU territory, or cannot
be known until the customer enrolls or requests a specific service.
(10) Term contract--A contract with a term in excess
of 31 days.
(11) Variable price product--A retail product for which
price may vary according to a method determined by the REP, including
a product for which the price, can increase no more than a defined
percentage as indexed to the customer's previous billing month's price.
For residential customers, a variable price product can be only a
(12) Wholesale Indexed Product--A retail electric product
in which the price a customer pays for electricity includes a direct
pass-through of real-time settlement point prices determined by the
independent organization certified under the Public Utility Regulatory
Act (PURA) §39.151 for the ERCOT power region.
(c) General Retail Electric Provider requirements.
(1) General Disclosure Requirements.
(A) All written, electronic, and oral communications,
including advertising, websites, direct marketing materials, billing
statements, terms of service, EFLs, YRACs, and, if applicable, PDSs
distributed by a REP or aggregator must be clear and not misleading,
fraudulent, unfair, deceptive, or anti-competitive. Prohibited communications
include, but are not limited to:
(i) Using the term or terms "fixed" to market a product
that does not meet the definition of a fixed rate product.
(ii) Suggesting, implying, or otherwise leading someone
to believe that a REP or aggregator has been providing retail electric
service prior to the time the REP or aggregator was certified or registered
by the commission.
(iii) Suggesting, implying or otherwise leading someone
to believe that receiving retail electric service from a REP will
provide a customer with better quality of service from the TDU.
(iv) Falsely suggesting, implying or otherwise leading
someone to believe that a person is a representative of a TDU or any
REP or aggregator.
(v) Falsely suggesting, implying or otherwise leading
someone to believe that a contract has benefits for a period of time
longer than the initial contract term.
(B) Written and electronic communications must not
refer to laws, including commission rules without providing a link
or website address where the text of those rules are available. All
printed advertisements, electronic advertising over the Internet,
and websites, must include the REP's certified name or commission
authorized business name, or the aggregator's registered name, and
the number of the certification or registration.
(C) The terms of service, EFL, YRAC , and, if applicable,
PDS must be provided to each customer upon enrollment. Each document
must be provided to the customer whenever a change is made to the
specific document and upon a customer's request, at any time free
(D) A REP must retain a copy of each version of the
terms of service, EFL, YRAC, and, if applicable, PDS during the time
the plan is in effect for a customer and for four years after the
contract ceases to be in effect for any customer. REPs must provide
such documents at the request of the commission or its staff.
(2) General contracting requirements.
(A) Each terms of service, EFL, and YRAC must be complete,
be written in language that is clear, plain and easily understood,
and be printed in paragraphs of no more than 250 words in a font no
smaller than 10 point. References to laws including commission rules
in these documents must include a link or website address to the full
text of the applicable law or rule.
(B) Each contract document must be available to the
commission to post on its customer education website if the REP chooses
to post offers to the website.
(C) A contract is limited to service to a customer
at a location specified in the contract. If the customer moves from
the location, the customer is under no obligation to continue the
contract at another location. The REP may require a customer to provide
evidence that it is moving to another location. There must be no early
termination fee assessed to the customer as a result of the customer's
relocation if the customer provides a forwarding address and, if required,
reasonable evidence that the customer no longer occupies the location
specified in the contract.
(D) A terms of service document and EFL must disclose
the type of product being described, using one of the following terms:
fixed rate product or a variable price product.
(E) A REP must not use a credit score, a credit history,
or utility payment data as the basis for determining the price for
electric service for a product with a contract term of 12 months or
less for an existing residential customer or in response to an applicant's
request to become a residential customer.
(F) In any dispute between a customer and a REP concerning
the terms of a contract, any vagueness, obscurity, or ambiguity in
the contract will be construed in favor of the customer.
(G) For a variable price product, the REP must disclose
on the REP's website and through a toll-free number the current price
and, for residential customers, one year price history, or history
for the life of the product, if it has been offered less than one
year. A REP must not rename a product in order to avoid disclosure
of price history. The EFL of a variable price product must include
a notice of how the current price and, if applicable, historical price
information may be obtained by a customer.
(H) A REP must comply with its contracts.
(3) Specific contract requirements.
(A) The contract term must be conspicuously disclosed.
(B) The start and end dates of the contract must be
available to the customer upon request. If the REP cannot determine
the start date, the REP may estimate the start date. After the start
date is known, the REP must specify the end date of the contract by:
(i) specifying a calendar date; or
(ii) reference to the first meter read on or after
a specific calendar date.
(C) If a REP specifies a calendar date as the end date,
the REP may bill the term contract price through the first meter read
on or after the end date of the contract.
(D) Each contract for service must include the terms
of the default renewal product that the customer will be automatically
enrolled in if the customer does not select another retail electric
product before the expiration of the contract term after the customer
has received all required expiration notices.
(E) If a REP does not provide proper notice of the
expiration of a fixed rate contract and the customer does not select
another REP before expiration of the contract term, the REP must continue
to serve the customer under the pricing terms of the fixed rate product
until the REP provides notice in accordance with applicable requirements
of subsection I(2)(A)(i) or (ii) or the customer selects another retail
(F) A REP, aggregator, or broker is prohibited from
(i) an indexed product to a residential or small commercial
customer on or after February 1, 2022; or
(ii) a wholesale indexed product to a residential or
small commercial customer on or after September 1, 2021.
(4) Website requirements.
(A) Each REP that offers residential retail electric
products for enrollment on its website must prominently display the
EFL for any products offered without a person having to enter any
personal information other than zip code and information that allows
determination of the type of offer the consumer wishes to review.
Person-specific information must not be required.
(B) The EFL for each product must be printable in no
more than a two-page format. The EFL, terms of service, YRAC, and,
if applicable, PDS for any products offered for enrollment on the
website must be available for viewing or downloading.
(d) Changes in contract and price and notice of changes.
A REP may make changes to the terms and conditions of a contract or
to the price of a product as provided for in this section. Changes
in term (length) of a contract require the customer to enter into
a new contract and may not be made by providing the notice described
in paragraph (3) of this subsection.
(1) Contract changes other than price.
(A) A REP may not change the price (other than as allowed
by paragraph (2) of this subsection) or contract term of a term contract
for a retail electric product, during its term; but may change any
other provision of the contract, with notice under paragraph (3) of
(B) A REP may not change the terms and conditions of
a variable price month-to-month product unless it provides notice
under paragraph (3) of this subsection.
(2) Price changes.
(A) A REP may only change the price of a fixed rate
product or a variable product consistent with the definitions in this
section and according to the product's EFL. Such price changes do
not require notice under paragraph (3) of this subsection.
(B) For a fixed rate product, each bill must either
show the price changes on one or more separate line items, or must
include a conspicuous notice stating that the amount billed may include
price changes allowed by law or regulatory actions.