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The Commission requested briefs and other written comments on whether the POR prohibition of SB1 should apply to all residential retail choice accounts or only those residential retail choice accounts that have agreements entered or renewed after January 1, 2025.

Comments were filed by Maryland Energy Advocates Coalition (MEAC), WGL Energy Services, Inc., Retail Energy Supply Association, CleanChoice Energy, Inc., and NRG Energy, Inc. and SFE Energy Maryland, Inc., and StateWise Energy Maryland LLC.

Excerpts From RESA, CleanChoice Energy, And NRG Energy Comments:

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“Retail Energy Supply Association (“RESA”), 2 CleanChoice Energy, Inc. (“CleanChoice”), and NRG Energy, Inc. (“NRG”), submit these comments in response to the Notice. As discussed below, the grandfathering provisions in SB1 protect existing contracts and, therefore, the residential POR programs must continue beyond January 1, 2025, for existing contracts, including not only supply contracts but also the suppliers’ billing services agreements in which the utilities agree to provide POR to the supplier.”

“SB1 does not apply to: (1) supply agreements executed before January 1, 2025; or (2) billing services agreements entered into between utilities and suppliers before July 1, 2024.” 

“The Commission’s inquiry involves two types of agreements that Maryland suppliers execute to serve customers. First, to properly enroll a customer into its electricity or natural gas supply service, a supplier and customer must enter into a contract that complies with applicable COMAR provisions. Second, every Maryland supplier must sign a billing services agreement (“BSA”) with the utility. In the BSA, the utility agrees to provide billing services and to purchase the supplier’s receivables in accordance with the utility’s applicable tariff. In SB1, the plain language of the grandfathering provisions demonstrates the General Assembly’s manifest intent to prospectively implement the requirements of SB1 with respect to both types of contracts. Not only is the prospective language plain and unambiguous, but there is no indication that the General Assembly intended to apply SB1 retrospectively to impair existing contracts. Because prospectively is favored and impairing substantive rights is prohibited without a clear expression of legislative intent, supply agreements entered into before January 1, 2025 cannot be disrupted, nor can BSAs entered into before the effective date of SB1 – July 1, 2024.” [***]

Excerpts From SFE Energy Maryland and StateWise Energy Maryland LLC Comments:

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SFE Energy submits that the residential POR prohibition in SB1 should be interpreted as applying prospectively to agreements entered into after January 1, 2025. This result is dictated by the clear terms of the statutory language and canons of statutory interpretation in favor of the prospective application of the law. The Retail Energy Supply Association, CleanChoice Energy, Inc., and NRG Energy, Inc. filed Comments in this matter dated August 2, 2024 [hereinafter “Joint Comments”], taking the position that “the grandfathering provisions in SB1 protect existing Competitive suppliers have entered into agreements with residential customers under the longstanding construct of utility consolidated billing with purchase of receivables. The rationale for utility consolidated billing with POR is well understood – it leverages the utility collection and termination processes, thereby allowing competitive suppliers to more effectively manage collection risks. Retroactively changing those rules will fundamentally change the economics of serving customers that have already been enrolled. These are rules that competitive suppliers fairly and justifiably relied upon when making the decision to do business in the State.”

As such, briefs filed by retail suppliers focused on what appears to be the undisputed position that SB1’s residential POR prohibition does not apply to existing contracts, and did not materially address the policy question of the PSC acting on its own authority to end POR contracts and, therefore, the residential POR programs must continue beyond January 1, 2025, for existing contracts, including not only supply contracts but also the suppliers’ billing services agreements in which the utilities agree to provide POR to the supplier.” (Joint Comments at p.1- 2). SFE Energy strongly supports the legal and policy arguments set forth in the Joint Comments and urges the Commission to adopt a decision consistent with the recommendations set forth therein. [***]

WGL Comments:

[***]SB 1 enacted a new § 7-604.2 that imposes the same restrictions and requirements on residential gas supply contracts that § 7-510 (d) imposes on residential electricity supply contracts (except there is no green power equivalent for gas), including the restriction that a retail gas supplier may not sell to a gas company, and a gas company may not purchase from the gas supplier, accounts receivable (§ 7-604.2(b)(4)). Hence, residential gas supply and electricity supply contracts entered before January 1, 2025, are not subject to the requirements of § 7-604.2 and § 7-510 (d) and remain subject to the UCB POR provisions of COMAR 20.59 and COMAR 20.53, and gas utilities and electric utilities remain obligated to honor those provisions and purchase the receivables of retail suppliers to the end of the term of those grandfathered contracts. [***]

RESA, CleanChoice Energy,  And NRG Energy Comments  (08/02/2024)
SFE Energy Maryland Comments (08/02/2024)
WGL Comments (08/02/2024) 

View all PC65 comments here.

PC65 (07/23/2024)
(Accounts Receivable Related To Residential Electric And Gas Supply)

See also: 9461  (09/15/2017)
(In The Matter Of The Petition Of NRG Energy, Inc., Interstate Gas Supply, Inc., Just Energy Group, Inc., Direct Energy Services, LLC, And Engie Resources, LLC For Implementation Of Supplier Consolidated Billing For Electricity And Natural Gas In Maryland.)
PC65 (07/23/2024) 
(Accounts Receivable Related To Residential Electric And Gas Supply)