H.B. No. 16
AN ACT
relating to the regulation of certain retail electric products.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 39, Utilities Code, is
amended by adding Section 39.110 to read as follows:
Sec. 39.110. WHOLESALE INDEXED PRODUCTS PROHIBITED. (a)
In this section, "wholesale indexed product" means 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 Section
39.151 for the ERCOT power region.
(b) An aggregator, a broker, or a retail electric provider
may not offer a wholesale indexed product to a residential or small
commercial customer.
(c) An aggregator, a broker, or a retail electric provider
may enroll a customer other than a residential and small commercial
customer in a wholesale indexed product only if the provider,
aggregator, or broker obtains before the customer's enrollment an
acknowledgment signed by the customer that the customer accepts the
potential price risks associated with a wholesale indexed product.
(d) An acknowledgment required by Subsection (c) must
include the following statement, in clear, boldfaced text:
"I understand that the volatility and fluctuation of
wholesale energy pricing may cause my energy bill to be
multiple times higher in a month in which wholesale
energy prices are high. I understand that I will be
responsible for charges caused by fluctuations in
wholesale energy prices."
(e) An acknowledgment required by Subsection (c) may be
included as an addendum to a contract.
(f) A retail electric provider that provides a wholesale
indexed product to a customer must keep on file the acknowledgment
required by Subsection (c) for each customer while the customer is
enrolled with the retail electric provider in the wholesale indexed
product.
SECTION 2. Section 39.112, Utilities Code, is amended to
read as follows:
Sec. 39.112. NOTICE OF EXPIRATION AND PRICE CHANGE. (a) In
this section, "fixed rate product" means a retail electric product
with a term of at least three months for which the price for each
billing period, including recurring charges, does not change
throughout the term of the contract, except that the price may vary
to reflect actual changes in transmission and distribution utility
charges, changes to ERCOT or Texas Regional Entity administrative
fees charged to loads, or changes to federal, state, or local laws
that result in new or modified fees or costs that are not within the
retail electric provider's control.
(b) A retail electric provider shall provide a residential
customer who has a fixed rate product with at least three [one]
written notices [notice] of the date the fixed rate product will
expire. The notices [notice] must be provided during the last third
of the contract period and in intervals that allow for, as
practicable, even distribution of the notices throughout the last
third of the contract period. The final notice for a contract with
a period of more than four months must be provided at least 30 days
before the date that the contract will expire. The final notice for
a contract with a period of less than four months must be provided
at least 15 days before the date that the contract will expire.
(c) The retail electric provider must provide each notice
required by Subsection (b) to the customer by mail at the customer's
billing address, unless the customer has opted to receive
communications electronically from the retail electric provider.
(d) If the retail electric provider has access to customer
contact information that allows the provider to send the customer a
text message or call the customer, and the customer has agreed to
receive notices by text message or call, the retail electric
provider may provide additional notice to the customer by text
message or call of the date the fixed rate product will expire.
Notice provided by text message or call does not constitute notice
under Subsection (b).
(e) A notice required by Subsection (b) must:
(1) for a notice provided by mail, [be sent to the
customer's billing address by mail at least 30, but not more than
60, days preceding the date the contract will expire;
[(2) be sent to the customer's e-mail address, if
available to the provider and if the customer has agreed to receive
notices electronically, at least 30, but not more than 60, days
preceding the date the contract will expire;
[(3)] include in a manner visible from [on] the
outside of the envelope in which the notice is sent, a statement
that reads: "Contract Expiration Notice. See Enclosed.";
(2) [(4)] if included with a customer's bill, be
printed on a separate page or included as a separate document; [and]
(3) [(5)] include a description of any fees or charges
associated with the early termination of the customer's fixed rate
product; and
(4) describe any renewal offers the retail electric
provider chooses to make available to the customer and identify
methods by which the customer may obtain the contract documents for
each of the offered products.
(f) The final notice provided under Subsection (b) must
include the pricing terms for the default renewal product required
by Subsection (h).
(g) [(c)] A retail electric provider shall include on each
billing statement, in boldfaced and underlined text, the end date
of the fixed rate product.
(h) Except as provided by Subsection (j), if a customer does
not select another retail electric product before the expiration of
the customer's contract term with a retail electric provider, the
provider shall automatically serve the customer through a default
renewal product that the customer may cancel at any time without a
fee. The default renewal product must be:
(1) a month-to-month product in which the price the
customer pays for electricity may vary between billing cycles; and
(2) based on clear terms designed to be easily
understood by the average customer.
(i) A retail electric provider shall include in each
contract for service the terms of the default renewal product that
the customer will automatically be enrolled in under Subsection (h)
if the customer does not select another retail electric product
before the expiration of the contract term.
(j) If a retail electric provider does not provide notice of
the expiration of a customer's contract with the provider in
accordance with this section and the customer does not select
another retail electric product before the expiration of the
customer's contract term with the provider, the retail electric
provider must continue to serve the customer under the pricing
terms of the fixed rate product contract until:
(1) the provider provides notice of the expiration of
the contract in accordance with this section; or
(2) the customer selects another retail electric
product.
(k) [(d)] No provision in this section shall be construed to
prohibit the commission from adopting rules that would provide a
greater degree of customer protection.
SECTION 3. The changes in law made by this Act apply only to
an enrollment or re-enrollment of a customer in a retail electric
product that is executed on or after the effective date of this Act.
An enrollment or re-enrollment of a customer in a retail electric
product that is executed before the effective date of this Act is
governed by the law as it existed immediately before the effective
date of this Act, and that law is continued in effect for that
purpose.
SECTION 4. This Act takes effect September 1, 2021.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 16 was passed by the House on March
31, 2021, by the following vote: Yeas 116, Nays 31, 1 present, not
voting; and that the House concurred in Senate amendments to H.B.
No. 16 on May 12, 2021, by the following vote: Yeas 123, Nays 24, 1
present, not voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 16 was passed by the Senate, with
amendments, on April 29, 2021, by the following vote: Yeas 29,
Nays 2.
______________________________
Secretary of the Senate
APPROVED: __________________
Date
__________________
Governor