Article 12. Consumer Protection of California Public Utilities Code >> Division 1. >> Part 1. >> Chapter 2.3. >> Article 12.
(a) As used in this section, "electric service provider" means
an entity that offers electrical service to customers within the
service territory of an electrical corporation, but does not include
an electrical corporation, as defined in Section 218, does not
include an entity that offers electrical service solely to serve
customer load consistent with subdivision (b) of Section 218, and
does not include a public agency that offers electrical service to
residential and small commercial customers within its jurisdiction,
or within the service territory of a local publicly owned electric
utility. "Electric service provider" includes the unregulated
affiliates and subsidiaries of an electrical corporation, as defined
in Section 218.
(b) Each electric service provider shall register with the
commission. As a precondition to registration, the electric service
provider shall provide, under oath, declaration, or affidavit, all of
the following information to the commission:
(1) Legal name and any other names under which the electric
service provider is doing business in California.
(2) Current telephone number.
(3) Current address.
(4) Agent for service of process.
(5) State and date of incorporation, if any.
(6) Number for a customer contact representative, or other
personnel for receiving customer inquiries.
(7) Brief description of the nature of the service being provided.
(8) Disclosure of any civil, criminal, or regulatory sanctions or
penalties imposed within the 10 years immediately prior to
registration, against the company or any owner, partner, officer, or
director of the company pursuant to any state or federal consumer
protection law or regulation, and of any felony convictions of any
kind against the company or any owner, partner, officer, or director
of the company. In addition, each electric service provider shall
furnish the commission with fingerprints for those owners, partners,
officers, and managers of the electric service provider specified by
any commission decision applicable to all electric service providers.
The commission shall submit completed fingerprint cards to the
Department of Justice. Those fingerprints shall be available for use
by the Department of Justice and the Department of Justice may
transmit the fingerprints to the Federal Bureau of Investigation for
a national criminal history record check. The commission may use
information obtained from a national criminal history record check
conducted pursuant to this section to determine an electric service
provider's eligibility for registration.
(9) Proof of financial viability. The commission shall develop
uniform standards for determining financial viability and shall
publish those standards for public comment no later than March 31,
1998. In determining the financial viability of the electric service
provider, the commission shall take into account the number of
customers the potential registrant expects to serve, the number of
kilowatthours of electricity it expects to provide, and any other
appropriate criteria to ensure that residential and small commercial
customers have adequate recourse in the event of fraud or
(10) Proof of technical and operational ability. The commission
shall develop uniform standards for determining technical and
operational capacity and shall publish those standards for public
comment no later than March 31, 1998.
(c) Any registration filing approved by the commission prior to
the effective date of this section which does not comply in all
respects with the requirements of subdivision (a) of Section 394
shall nevertheless continue in force and effect so long as within 90
days of the effective date of this section the electric service
provider undertakes to supplement its registration filing to the
satisfaction of the commission. Any registration that is not
supplemented by the required information within the time set forth in
this subdivision shall be suspended by the commission and shall not
be reinstated until the commission has found the registration to be
in full compliance with subdivision (a) of Section 394.
(d) Any public agency offering aggregation services as provided
for in Section 366 solely to retail electric customers within its
jurisdiction that has registered with the commission prior to the
enactment of this section may voluntarily withdraw its registration
to the extent that it is exempted from registration under this
(e) Before reentering the market, electric service providers whose
registration has been revoked shall file a formal application with
the commission that satisfies the requirements set forth in Section
394.1 and demonstrates the fitness and ability of the electric
service provider to comply with all applicable rules of the
(f) Registration with the commission is an exercise of the
licensing function of the commission, and does not constitute
regulation of the rates or terms and conditions of service offered by
electric service providers. Nothing in this part authorizes the
commission to regulate the rates or terms and conditions of service
offered by electric service providers.
(a) The registration shall be deemed approved and a
registration number issued no later than 45 days after the required
information has been submitted, unless the commission's executive
director finds, upon review of the information submitted by the
electric service provider or available to the commission, that there
is evidence to support a finding that the electric service provider
has committed an act constituting grounds for denial of registration
as specifically set forth in the operative provisions of this
chapter, including, but not limited to, subdivision (c).
(b) Upon a finding by the commission's executive director that
there is evidence to support a finding that the electric service
provider has committed an act constituting grounds for denial of
registration as set forth in this section, the commission shall
notify the electric service provider in writing, cause the documents
submitted by the electric service provider to be filed as a formal
application for registration, and notice an expedited hearing on the
registration of the electric service provider to be held within 30
days of the notification to the electric service provider of the
executive director's finding of evidence to support denial of
registration. The commission shall, within 45 days after holding the
hearing, issue a decision on the registration request which shall be
based on the findings of fact and conclusions of law based on the
evidence presented at the hearing. The decision shall include the
findings of fact and the conclusions of law relied upon.
(c) (1) The commission may deny an application for registration in
accordance with subdivision (b) on the grounds that the electric
service provider or any officer or director of the electric service
provider has one or more of the following:
(A) Been convicted of a crime as described in paragraph (8) of
subdivision (a) of Section 394.
(B) Failure to make a sufficient showing with respect to
paragraphs (1) to (10), inclusive, of subdivision (a) of Section 394.
(C) Knowingly made a false statement of fact in the application
(2) The commission may deny registration pursuant to this
subdivision only if the crime or act is substantially related to the
qualifications, functions, or duties required to provide retail
electric service to end use customers of electricity or the false
statement is material to the registration application. For purposes
of this subdivision, conviction of a crime shall be established in
the same manner as that set forth in paragraph (1) of subdivision (a)
of Section 480 of the Business and Professions Code.
(d) The commission shall require electric service providers
registered under this section to update their registration
information set forth in paragraphs (1) to (10), inclusive, of
subdivision (a) of Section 394 within 60 days of any material change
in the information provided. Material changes to any other
information required pursuant to this article shall be updated
(a) The commission shall accept, compile, and attempt to
informally resolve consumer complaints regarding electric service
providers. Where the commission reasonably suspects a pattern of
customer abuses, the commission may, on its own motion, initiate
investigations into the activities of electric service providers
offering electrical service. Consumer complaints regarding service by
a public agency offering electric service within the political
boundary of the public agency or service territory of a local
publicly owned electric utility shall continue to be resolved by the
public agency. Within the service territory of a local publicly owned
utility, consumer complaints arising from the violation of direct
access rules adopted by the governing body of the local publicly
owned utility shall be resolved through the local publicly owned
utility's consumer complaint procedures.
(b) Notwithstanding other provisions, residential and small
commercial customers shall have the option to proceed with a
complaint against an electric service provider either through an
action filed in the judicial court system or through a complaint
filed with the commission. A customer who elects either the judicial
or commission remedies may not raise the same claim in both forums.
The commission shall have the authority to accept, compile, and
resolve residential, and small commercial consumer complaints,
including the authority to award reparations. The commission's
authority in these complaint proceedings is limited to adjudication
of complaints regarding residential and small commercial electric
service provided by an electric service provider and shall not be
expanded to include either an award of any other damages or
regulation of the rates or charges of the electric service provider.
However, a person or electric service provider that takes a conflict
to the commission shall not be precluded from pursuing an appeal of
the decision through the courts as provided for in law.
(c) In connection with customer complaints or commission
investigations into customer abuses, electric service providers shall
provide the commission access to their accounts, books, papers, and
documents related to California transactions as described in Sections
313 and 314, provided the information is relevant to the complaint
(d) No electric service provider may discontinue service to a
customer for a disputed amount if that customer has filed a complaint
that is pending with the commission, and that customer has paid the
disputed amount into an escrow account.
(a) The commission may enforce the provisions of Sections
2102, 2103, 2104, 2105, 2107, 2108, and 2114 against electric service
providers as if those electric service providers were public
utilities as defined in these code sections. Notwithstanding the
above, nothing in this section grants the commission jurisdiction to
regulate electric service providers other than as specifically set
forth in this part. Electric service providers shall continue to be
subject to the provisions of Sections 2111 and 2112. Upon a finding
by the commission's executive director that there is evidence to
support a finding that the electric service provider has committed an
act constituting grounds for suspension or revocation of
registration as set forth in subdivision (b) of Section 394.25, the
commission shall notify the electric service provider in writing and
notice an expedited hearing on the suspension or revocation of the
electric service provider's registration to be held within 30 days of
the notification to the electric service provider of the executive
director's finding of evidence to support suspension or revocation of
registration. The commission shall, within 45 days after holding the
hearing, issue a decision on the suspension or revocation of
registration, which shall be based on findings of fact and
conclusions of law based on the evidence presented at the hearing.
The decision shall include the findings of fact and the conclusions
of law relied upon.
(b) An electric service provider may have its registration
suspended or revoked, immediately or prospectively, in whole or in
part, for any of the following acts:
(1) Making material misrepresentations in the course of soliciting
customers, entering into service agreements with those customers, or
administering those service agreements.
(2) Dishonesty, fraud, or deceit with the intent to substantially
benefit the electric service provider or its employees, agents, or
representatives, or to disadvantage retail electricity customers.
(3) Where the commission finds that there is evidence that the
electric service provider is not financially or operationally capable
of providing the offered electric service.
(4) The misrepresentation of a material fact by an applicant in
obtaining a registration pursuant to Section 394.
(c) Pursuant to its authority to revoke or suspend registration,
the commission may suspend a registration for a specified period or
revoke the registration, or in lieu of suspension or revocation,
impose a moratorium on adding or soliciting additional customers. Any
suspension or revocation of a registration shall require the
electric service provider to cease serving customers within the
boundaries of investor-owned electrical corporations, and the
affected customers shall be served by the electrical corporation
until the time when they may select service from another service
provider. Customers shall not be liable for the payment of any early
termination fees or other penalties to any electric service provider
under the service agreement if the serving electric service provider'
s registration is suspended or revoked.
(d) The commission shall require any electric service provider
whose registration is revoked pursuant to paragraph (4) of
subdivision (b) to refund all of the customer credit funds that the
electric service provider received from the State Energy Resources
Conservation and Development Commission pursuant to subdivision (a)
of Section 25744 of the Public Resources Code. The repayment of these
funds shall be in addition to all other penalties and fines
appropriately assessed the electric service provider for committing
those acts under other provisions of law. All customer credit funds
refunded under this subdivision shall be deposited in the Renewable
Resource Trust Fund for redistribution by the State Energy Resources
Conservation and Development Commission pursuant to Chapter 8.6
(commencing with Section 25740) of Division 15 of the Public
Resources Code. This subdivision may not be construed to apply
(e) If a customer of an electric service provider or a community
choice aggregator is involuntarily returned to service provided by an
electrical corporation, any reentry fee imposed on that customer
that the commission deems is necessary to avoid imposing costs on
other customers of the electrical corporation shall be the obligation
of the electric service provider or a community choice aggregator,
except in the case of a customer returned due to default in payment
or other contractual obligations or because the customer's contract
has expired. As a condition of its registration, an electric service
provider or a community choice aggregator shall post a bond or
demonstrate insurance sufficient to cover those reentry fees. In the
event that an electric service provider becomes insolvent and is
unable to discharge its obligation to pay reentry fees, the fees
shall be allocated to the returning customers.
When a customer files a claim with an electrical
corporation for damages to property resulting from the curtailment of
electric service due to the failure of the electrical corporation to
reasonably provide service or restore service within a reasonable
time after a fire, flood, earthquake, other natural disaster, or act
of God, the electric corporation shall inform the customer that such
claim may be pursued in small claims court or other judicial courts,
depending on the amount of the claim.
To carry out essential elements of a sustainable and
effective consumer protection program in connection with electric
service providers offering electrical service to residential and
small commercial customers as intended by the Legislature in this
article, the following shall apply:
(a) The commission shall collect a registration fee of one hundred
dollars ($100) from electric service providers required to register
under this article, and deposit the fee proceeds in the Public
Utilities Reimbursement Account established under Section 402.
(b) The commission shall annually determine the costs of
administering the registration program and other facets of consumer
protection directly related to the direct access transactions of
electric service providers. The commission shall collect only those
costs not already being collected elsewhere. A registrant who fails
to submit to the commission a required fee or a piece of information
upon which fees are calculated within 30 days of billing shall be
subject to a 15-percent penalty.
Rules that implement the following minimum standards shall
be adopted by the commission for electric service providers offering
electrical services to residential and small commercial customers and
the governing body of a public agency offering electrical services
to residential and small commercial customers within its
(a) Confidentiality: Customer information shall be confidential
unless the customer consents in writing. This shall encompass
confidentiality of customer specific billing, credit, or usage
information. This requirement shall not extend to disclosure of
generic information regarding the usage, load shape, or other general
characteristics of a group or rate classification, unless the
release of that information would reveal customer specific
information because of the size of the group, rate classification, or
nature of the information.
(b) Physical disconnects and reconnects: Only an electrical
corporation, or a publicly owned electric utility, that provides
physical delivery service to the affected customer shall have the
authority to physically disconnect or reconnect a customer from the
transmission or distribution grid. Physical disconnection by
electrical corporations subject to the commission's jurisdiction
shall occur only in accordance with protocols established by the
commission. Physical disconnection by publicly owned electric
utilities shall occur only in accordance with protocols established
by the governing board of the local publicly owned electric utility.
(c) Change in providers: Upon adequate notice supplied by a
electric service provider to the electric corporation or local
publicly owned electric utility providing physical delivery service,
customers who are eligible for direct access may change their energy
supplier. Energy suppliers may charge for this change, provided that
any fee or penalty charged by the supplier associated with early
termination of service, shall be disclosed in that contract or
(d) Written notices: Notices describing the terms and conditions
of service as described in Section 394.5, service agreements, notices
of late payment, notices of discontinuance of service, and
disconnection notices addressed to residential and small commercial
customers shall be easily understandable, and shall be provided in
the language in which the electric service provider offered the
(e) Billing: All bills shall have a standard bill format, as
determined by the commission or the governing body, and shall contain
sufficient detail for the customer to recalculate the bill for
accuracy. Any late fees shall be separately stated. Each electric
service provider shall provide on all customer bills a phone number
by which customers may contact the electric service provider to
report and resolve billing inquiries and complaints. An electric
service provider contacted by a customer regarding a billing dispute
shall advise the customer at the time of the initial contact that the
customer may file a complaint with the commission if its dispute is
not satisfactorily resolved by the electric service provider.
(f) Meter integrity: An electric customer shall have a reasonable
opportunity to have its meter tested to ensure the reasonable
accuracy of the meter. The commission or governing body shall
determine who is responsible for the cost of that testing.
(g) Customer deposits: Electric service providers may require
customer deposits before commencing service, but in no event shall
the deposit be more than the estimated bill for the customer for a
(h) Additional protections: The commission or the governing body
may adopt additional residential and small commercial consumer
protection standards that are in the public interest.
(a) Except for an electrical corporation as defined in
Section 218, or a local publicly owned electric utility offering
electrical service to residential and small commercial customers
within its service territory, each electric service provider offering
electrical service to residential and small commercial customers
shall, prior to the commencement of service, provide the potential
customer with a written notice of the service describing the price,
terms, and conditions of the service. A notice shall include all of
(1) A clear description of the price, terms, and conditions of
(A) The price of electricity expressed in a format that makes it
possible for residential and small commercial customers to compare
and select among similar products and services on a standard basis.
The commission shall adopt rules to implement this subdivision. The
commission shall require disclosure of the total price of electricity
on a cents-per-kilowatthour basis, including the costs of all
electric services and charges regulated by the commission. The
commission shall also require estimates of the total monthly bill for
the electric service at varying consumption levels, including the
costs of all electric services and charges regulated by the
commission. In determining these rules, the commission may consider
alternatives to the cents-per-kilowatthour disclosure if other
information would provide the customer with sufficient information to
compare among alternatives on a standard basis.
(B) Separate disclosure of all recurring and nonrecurring charges
associated with the sale of electricity.
(C) If services other than electricity are offered, an itemization
of the services and the charge or charges associated with each.
(2) An explanation of the applicability and amount of the
competition transition charge, as determined pursuant to Sections 367
to 376, inclusive.
(3) A description of the potential customer's right to rescind the
contract without fee or penalty as described in Section 395.
(4) An explanation of the customer's financial obligations, as
well as the procedures regarding past due payments, discontinuance of
service, billing disputes, and service complaints.
(5) The electric service provider's registration number, if
(6) The right to change service providers upon written notice,
including disclosure of any fees or penalties assessed by the
supplier for early termination of a contract.
(7) A description of the availability of low-income assistance
programs for qualified customers and how customers can apply for
(b) The commission may assist electric service providers in
developing the notice. The commission may suggest inclusion of
additional information it deems necessary for the consumer protection
purposes of this section. On at least a semiannual basis, electric
service providers shall provide the commission with a copy of the
form of notice included in standard service plans made available to
residential and small commercial customers.
(c) An electric service provider offering electric services who
declines to provide those services to a consumer shall, upon request
of the consumer, disclose to that consumer the reason for the denial
in writing within 30 days. At the time service is denied, the
electric service provider shall disclose to the consumer the right to
make this request. A consumer shall have at least 30 days from the
date service is denied to make the request.
For purposes of this article, service territory of a local
publicly owned electric utility means within the boundaries of its
service territory as it existed on December 20, 1995, or within the
boundaries specified in an applicable service territory boundary
agreement entered into pursuant to Article 1 (commencing with Section
8101) of Division 4, or any other provision of law, between an
electrical corporation and the affected local publicly owned electric
utility, or within the boundaries specified in an applicable service
territory boundary agreement between one local publicly owned
electric utility and another local publicly owned electric utility.
Furthermore, for purposes of this article, the boundaries of the
Merced Irrigation District shall be as those boundaries existed on
December 20, 1995, together with the territory of Castle Air Force
Base, which was located outside of the district on that date.
(a) The commission shall maintain a list of residential and
small commercial customers who do not wish to be solicited by
telephone, by an electric corporation, marketer, broker, or
aggregator for electric service, to subscribe to or change their
electric service provider. The commission shall not assess a charge
for inclusion of a customer on the list. The list shall be updated
periodically, but no less than quarterly.
(b) The list shall include sufficient information for electric
corporations, marketers, brokers, or aggregators of electric service
to identify customers who do not wish to be solicited, including a
customer's address and telephone number. The list shall be made
accessible electronically from the commission to any party regulated
as an electric corporation or registered at the commission as an
electric marketer, broker, or aggregator of electric service.
(c) An electric corporation, marketer, broker, or aggregator of
electric service shall not solicit, by telephone, any customer on the
list prepared pursuant to subdivision (a). Any electric corporation,
marketer, broker, or aggregator of electric service, or the
representative of an electric corporation, marketer, broker, or
aggregator of electric service, who solicits any customer on the list
prepared pursuant to subdivision (a) more than once shall be liable
to the customer for twenty-five dollars ($25) for each contact in
violation of this subdivision.
(d) This section shall not apply to the telephone verification
required pursuant to Section 366.5.
Notwithstanding any other provision of this article,
requirements placed on an electric service provider shall not apply
to electrical services provided by a local publicly owned electric
utility to customers within the jurisdiction or service territory of
that local publicly owned electric utility.
Unclaimed refunds ordered by the commission, and any accrued
interest, may be used by the commission to fund additional consumer
(a) In addition to any other right to revoke an offer,
residential and small commercial customers of electrical service, as
defined in subdivision (h) of Section 331, have the right to cancel a
contract for electric service until midnight of the third business
day after the day on which the buyer signs an agreement or offer to
(b) Cancellation occurs when the buyer gives written notice of
cancellation to the seller at the address specified in the agreement
(c) Notice of cancellation, if given by mail, is effective when
deposited in the mail properly addressed with postage prepaid.
(d) 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.
(a) A consumer damaged by a violation of this article by an
electric service provider is entitled to recover all of the
(1) Actual damages.
(2) The consumer's reasonable attorney's fees and court costs.
(3) Exemplary damages, in the amount the court deems proper, for
intentional or willful violations.
(4) Equitable relief as the court deems proper.
(b) The rights, remedies, and penalties established by this
article are in addition to the rights, remedies, or penalties
established under any other law.
(c) Nothing in this article shall abrogate any authority of the
Attorney General to enforce existing law.
The governing body of a community choice aggregator shall
adopt a policy that expressly prohibits the dissemination by the
community choice aggregator of any statement relating to the
community choice aggregator's rates or terms and conditions of
service that is untrue or misleading, and that is known, or that, by
the exercise of reasonable care, should be known, to be untrue or