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Reliant Energy Retail Services, LLC (Reliant) would pay an administrative penalty of $50,100 and make a $20,000 donation to its bill payment assistance program under a settlement with Staff of the Texas Public Utilities Commission (TPUC) to resolve alleged violations of 16 Texas Administrative Code (TAC) § 25.479(b)(1), related to the issuance and format of bills, due to Reliant’s failure to issue a monthly bill to approximately 500 customers.

“From January 1, 2022, to April 1, 2023, Reliant failed to issue a total of 701 monthly bills to 499 residential and small commercial customers.”

The alleged violations relate to instances in which Reliant did not receive from the TDU monthly meter read data. As a result, relying on a provision in its terms of service provided to customers, Reliant elected to not issue a monthly bill in these instances.

Under TPUC rules Retail Energy Providers (REPs) are required to issue bills monthly, except that a REP may bill less frequently than monthly if agreed to by the customer. REPs may issue a bill based on estimated usage if usage is not received from the TDU.

Reliant had elected not to issue a monthly bill when TDU meter read data had not been provided, but instead relied upon a provision in its terms of service (TOS) that state that the customer agrees that billing may be less frequent than monthly if Reliant does not receive meter data from the TDU in time to issue the monthly bill.

Staff contends that Reliant may not rely on its customer terms of service to establish a valid alternative billing arrangement because the TOS did not identify a regular, specific alternative billing interval.

Under 16 TAC § 25.479(b)(1), a REP must issue a monthly bill to each customer unless service is provided to the customer for a period of less than one month. A REP may issue a bill less frequently than monthly if both the customer and the REP agree to such an arrangement.

Moreover, under 16 TAC § 25.479(e), a REP may issue a bill based on an estimate of the customer’s usage if the REP is unable to timely obtain the meter-reading data from the customer’s TDU.

The settlement states that, at the time Reliant failed to provide the 701 missing monthly bills, the affected customers had not “effectively” agreed to receive bills at alternative, less-frequent billing intervals.

Excerpts from the settlement:

“Reliant asserts that its violations were inadvertent and caused by a misunderstanding of what is required to form a valid alternative billing arrangement under 16 TAC § 25.479(b)(1) and misinterpretation of the applicability of § 25.479(b)(2).”

“Reliant asserts that, at the time of the violations, Reliant believed that a customer’s assent to the language in the TOS created an alternative billing arrangement under 16 TAC § 25.479(b)(1) and, therefore, that Reliant was not required to provide a monthly bill to the affected customers under the circumstances.”

“In practice, Reliant’s purported arrangement left affected customers with no bill, no explanation, no indication of when a bill would be issued, and no information as to how the missing bill(s) would impact their financial responsibilities once a bill was ultimately issued. For each of the 499 affected customers, Reliant ultimately sent each a bill that invoiced the customer for all the past, unbilled usage, which often represented an amount double or triple that which they would have otherwise anticipated paying in a single monthly bill. Such a billing practice increased the financial burden placed on the customers during the pay period in which the bill was due. As a sophisticated market actor, Reliant should have known that such an arrangement — particularly when borne out of a contract of adhesion, for which customers have no bargaining power or opportunity to negotiate — did not reasonably qualify as an alternative billing arrangement as contemplated under 16 TAC § 25.479(b)(1). Further, as a sophisticated market actor, Reliant should have understood that the vagueness of the purported arrangement risked economic harm to customers that were unable to anticipate the occurrence, duration, or impact of an extended billing period and may not have had the financial means to accommodate the additional cost during the pay period in which their next bill was ultimately due.”

“Commission Staff asserts, and Reliant acknowledges, that language contained in Reliant’s TOS did not establish a valid alternative billing arrangement under 16 TAC § 25.479(b)(1) because the terms did not identify a regular, specific alternative billing interval such that a customer could independently anticipate when a bill would be received.”

“The parties acknowledge that, in the absence of a valid alternative billing arrangement, a REP is obligated to provide some form of a monthly bill to each customer, even if the REP is unable to calculate the bill based on the customer’s actual usage due to a failure of the TDU.”

As of March 1, 2024, Reliant updated its terms of service to remove the statement that, “customers agree that Reliant may issue a bill less than frequently than monthly if Reliant does not receive meter readings or usage information from the TDU or ERCOT in time to prepare and send a monthly bill.”

“Should Reliant be unable to timely issue monthly bills to customers, Reliant has implemented a communications plan to inform impacted customers that their monthly bill may be delayed, as well as what to expect once monthly billing resumes.”

“Reliant may issue bills less frequently than monthly if both the customer and Reliant agree to such an arrangement. Reliant acknowledges that disclosure of a less than monthly billing cadence in a REP’s terms of service alone would not constitute the customer’s agreement to such an arrangement.” 

Settlement Agreement And Report To The Commission  (07/31/2024)
56890  (07/31/2024)
Settlement Agreement And Report To The Commission Regarding Reliant Energy Retail Services, LLC’s Alleged Violations Of 16 TAC § 25.479(B)(1), Related To Issuance And Format Of Bills