Assignment of Proceeding
Loretta M. Lynch is the Assigned Commissioner, and John S. Wong is the assigned ALJ in this proceeding.
1. Section 394(a), as added by AB 1890, required the registration of each entity offering electric service to residential and small commercial customers within the service territory of an electrical corporation.
2. Section 394(a), as added by AB 1890, was implemented in D.97-05-040.
3. Section 394(a), as added by SB 477, broadened the registration requirement to include ESPs offering electric service to residential and small commercial customers who operate in the service territories of publicly owned electric utilities.
4. D.98-03-072 addressed § 394(a), as added by SB 477, and also implemented the other SB 477 consumer protection safeguards by setting forth proposed permanent standards for proof of financial viability and proof of technical and operational ability.
5. The proposed permanent standards for proof of financial viability and proof of technical and operational ability were adopted in D.99-05-034 as the permanent standards.
6. Section 394, as amended by AB 1658, added wording to define that an ESP means an entity that offers electric service to residential and small commercial customers.
7. AB 1658 also added a fingerprint requirement as part of the registration process.
8. Due to AB 117, our registration procedures need to be expanded to include all ESPs who were not previously required to register with the Commission.
9. The expanded registration requirement will primarily affect those entities who provide electric service to agricultural customers, medium to large commercial customers and/or to industrial customers.
10. The registration procedures and ESP registration form that we adopted in D.97-05-040, as modified by D.98-03-072 and D.99-05-034, should serve as the foundation for the registration of all ESPs who are required to register.
11. One of the requirements of the ESP registration form is that the ESP have an executed Service Agreement with each UDC in whose service territory the ESP plans to do business.
12. As part of the direct access tariff, all ESPs, regardless of the type of customers they serve, are required to execute a Service Agreement with the UDC.
13. Several revisions have been made to the ESP registration form to reflect the following: AB 117's broadening of the registration requirement; that some code section requirements only apply to ESPs who serve residential and small commercial customers; and that permanent standards were adopted in D.99-05-034 for ESPs who serve residential and small commercial customers, and in this decision for those ESPs who serve agricultural customers, medium to large commercial customers and industrial customers.
14. The ESP registration form and procedures are related to the permanent standards for proof of financial viability and proof of technical and operational ability.
15. The permanent financial viability standards that were adopted for ESPs who serve residential and small commercial customers provide a foundation for imposing financial viability standards on ESPs who serve larger customers because of similar financial concerns.
16. The permanent technical and operational ability standards that were adopted for ESPs who serve residential and small commercial customers provide a foundation for establishing technical and operational ability standards on ESPs who serve larger customers because of similar technical and operational concerns.
17. The distinction between the generic reference to an ESP, and to an ESP that serves residential and small commercial customers, is important for determining what code sections apply to an entity who provides electric service in California.
18. AB 117 amended § 394.25 by adding subdivision (e).
19. Section 394.25(e) requires that if a customer of an ESP or a community choice aggregator is returned to utility electric service due to the fault of the ESP or community choice aggregator, that the reentry fee imposed by the utility be paid for by the ESP or community choice aggregator.
20. Payment of the reentry fee is tied to the posting of a bond or demonstrating insurance sufficient to cover the reentry fee as a condition of registration.
21. Interested parties are put on notice that the schedule of the deposit amounts adopted in D.99-05-034 and in this decision may be revised.
1. Section 394, as amended by AB 117, expanded the registration of ESPs, with certain exceptions, to include entities that offer electric service to all sizes of customers.
2. The Electric Service Provider Registration Application Form, revised "9/03"and attached to this decision as Appendix A, shall serve as the ESP registration form for all ESPs starting today.
3. Due to the statutes which existed at the time D.97-05-040, D.98-03-072, and D.99-05-034 were adopted, modification of those decisions to reflect the AB 117 revisions would be inappropriate because AB 117 did not go into effect until January 1, 2003.
4. The interpretation of the proof of financial viability in § 394(b)(9), is affected by AB 117's broadening of which entities must now register with the Commission.
5. The permanent standards for proof of financial viability that were developed and implemented in D.98-03-072 and D.99-05-034 apply to those ESPs who serve residential and small commercial customers.
6. Even though § 394 was revised by AB 117, the preconditions to registration were not altered in § 394(b).
7. The Legislature's intent is that the proof of financial viability requirement in § 394(b) also apply to ESPs who serve agricultural customers, and the larger commercial customers and industrial customers.
8. Section 391 expresses a concern that the market structure for ESPs who serve larger customers should not be unduly burdensome.
9. Permanent standards labeled (1) and (2), adopted in D.99-05-034 for ESPs who serve residential and small commercial customers, should be adopted, with slight modifications to (2), as the permanent standards for proof of financial viability for ESPs who serve agricultural customers, medium to large commercial customers and industrial customers.
10. The permanent standards for proof of technical and operational ability that were developed and implemented in D.98-03-072 and D.99-05-034, apply to those ESPs who serve residential and small commercial customers.
11. Permanent standards labeled (1), (3) and (5), adopted in D.99-05-034 for ESPs who serve residential and small commercial customers, should be adopted as the permanent standards for proof of technical and operational ability for ESPs who serve agricultural customers, medium to large commercial customers and/or industrial customers.
12. All entities offering electric service to customers within the service territory of an electrical corporation, except as specifically excluded in § 394, shall be required to register with the Commission as an ESP within 90 days of today's date unless the ESP is currently registered and in good standing.
13. The electric utilities subject to our jurisdiction should be directed, within 20 days of today's date, to supply the names and addresses of all ESPs who are operating in their service territories or who have signed Service Agreements.
14. Within 30 days of today's date, the Energy Division should notify all the ESPs on the list of their obligation to register pursuant to AB 117 and this decision, monitor their compliance, take all necessary action to prevent unregistered ESPs from engaging in the sale of electricity to California customers, and update its records and documents to reflect the expanded registration requirements.
15. The term "ESP," as used in § 394, has the same meaning as used in other code sections, except when the other code sections specifically refer to an ESP that serves residential and small commercial customers.
16. Comments on whether the current schedule of the deposit amounts are sufficient to cover the reentry fee required under § 394.25(e) should be solicited.
IT IS ORDERED that:
1. Except for those electric service providers (ESPs) who have previously registered with the Commission and are in good standing, and as specified in Public Utilities Code § 394 as amended by Assembly Bill (AB) 117 (Stats. 2002, ch. 838), all entities who offer electric service to customers in California are required to register with the Commission.
a. All such entities who are required to register with the Commission shall do so within 90 days from today's date using the Electric Service Provider Registration Application Form, which is attached to this decision as Appendix A.
b. All entities who are required to register with the Commission shall provide all of the information, documents, fees, and deposits required by Public Utilities Code §§ 394 and 394.3, which requirements have been incorporated into the Electric Service Provider Registration Application Form.
2. The permanent standards for proof of financial viability and proof of technical and operational ability that were adopted in Decision (D.) 99-05-034 shall continue to apply to all ESPs who offer electric service to residential and small commercial customers.
3. The following standards for proof of financial viability and proof of technical and operational ability shall be adopted as the permanent standards for all ESPs who offer electric service to agricultural customers, medium to large commercial customers and/or to industrial customers:
(1) Before an ESP may apply for an ESP registration number, and for those ESPs who have already received an ESP registration number, the ESPs are required to provide the Energy Division with a signed copy of their UDC-ESP service agreements for each UDC in whose service territory the ESP plans to do business.
(2) At the time of registration with the CPUC, an ESP serving agricultural customers, medium to large commercial customers and/or industrial customers shall be required to post a minimum cash security deposit (cashier's check) or financial guarantee bond in the amount of $25,000 with the Commission. In the alternative, the registered ESP may open a customer trust account in that amount which is in a format approved by the Commission's General Counsel, and which ensures that the customers have adequate recourse in the event of the ESP's fraud or non-performance, and to pay any applicable re-entry fee.
If the actual number of customers served by the ESP exceeds 250, the ESP shall be required to immediately increase its security deposit, financial guarantee bond, or trust account in accordance with the following schedule when its number of customers raises the ESP to the different security deposit amount level.
# of Customers Security Deposit Amount
1 - 250 $25,000
251 - 500 $50,000
501 - 1000 $75,000
1001 + $100,000
If a cash security deposit is posted with the Commission, any interest earned on the deposit will be returned to the ESP on an annual basis.
(3) The ESP registration application form shall contain a section which requests the applicant to name the key technical and operational personnel, their titles, and a description, including the time period, of each key person's experience in the sale, procurement, metering, and billing of energy services or similar products. If someone other than the ESP will be doing the metering or billing on behalf of the ESP, the names of the companies providing those services and their experience shall be disclosed as well. If the applicant has been authorized by the California ISO to act as an SC [scheduling coordinator], this requirement is waived. The ESP who has been authorized as an SC shall submit a copy of such authorization as part of the ESP registration application form.
(4) Each ESP is required to submit a copy of all of its SC agreements or a signed declaration from each SC with which it has an agreement and which states that the ESP has entered into a SC agreement with the ESP. The copy or declaration shall be submitted to the Energy Division on or before the date when the ESP signs up its first customer. If the ESP is an SC authorized by the California ISO, this requirement is waived.
4. Within 20 days of today's date, PacifiCorp, Pacific Gas and Electric Company, San Diego Gas & Electric Company, Sierra Pacific Power Company, Southern California Edison Company, and Southern California Water Company, shall provide the Director of the Energy Division with the names and addresses of all ESPs providing electric service in their respective service territories, or who have signed an Energy Service Provider Service Agreement.
5. Within 30 days of today's date, the Energy Division, using the names and addresses of the ESPs supplied by the electric utilities, shall notify all ESPs in writing of the expanded registration requirement in Public Utilities Code § 394, as amended by AB 117, and of this decision, the process and deadline for registering with the Commission if they have not already registered, and their opportunity to comment on the current schedule of deposits and its relationship to the reentry fee.
a. The Energy Division shall ensure that all of the ESPs, providing electric service to customers in the applicable utility service territories have registered with the Commission within the 90 days.
b. If an ESP fails to register within the time allotted, the Energy Division is directed to take all necessary action to prevent the unregistered ESP from engaging in the sale of electricity to California customers.
c. The Energy Division shall update its registration records in accordance with the provisions of Public Utilities Code § 392.1, and make the necessary changes to all documents to reflect the expanded registration requirements and permanent standards for proof of financial viability and proof of technical and operational ability for ESPs who serve agricultural customers, medium to large commercial customers and/or industrial customers.
6. Interested persons are invited to file comments on whether the current schedule of the deposit amount that each registered ESP must post is sufficient to cover the reentry fee that an ESP or a community choice aggregator may be obligated for in accordance with Pub. Util. Code § 394.25(e).
(1) Opening comments shall be filed with the Commission's Docket Office, and served on the parties to this proceeding, on or before December 1, 2003.
(2) Reply comments shall be filed with the Docket Office on or before December 22, 2003, and served on the parties.
This order is effective today.
Dated _____________________, at San Francisco, California.
ATTACHMENT A
0462-800
ELECTRIC SERVICE PROVIDER REGISTRATION APPLICATION FORM
***PLEASE PRINT OR TYPE***
1. Exact Legal Name of Registrant:
________________________________________________________________
If registrant is conducting business in California under a fictitious business name, list all the names under which the registrant is doing business as (DBA) in California, and the date and county in which the fictitious business name statement was filed. (Attach additional page if necessary.) For each DBA, provide a copy of the proof of publication of the fictitious business name, or a copy of the certified fictitious business name statement. (See Business & Professions Code Sections 17910, 17917, 17926.)
________________________________________________ ___________________ ______________________________
DBA Date County
________________________________________________ ___________________ ______________________________
DBA Date County
________________________________________________ ___________________ ______________________________
DBA Date County
________________________________________________ ___________________ ______________________________
DBA Date County
2. Current Address:
___________________________________________________________________________________________________
Address
___________________________________________________________________________________________________
City State Zip Code
3. Current Telephone Number: ______________________________________________________________________
4. Type of Ownership:
_ Individual _ Partnership _ Corporation _ Limited Liability Company
_ Government Entity _ Other
INCOMPLETE APPLICATIONS
CANNOT BE PROCESSED
5. If a non-California corporation, limited liability company, or limited partnership, attach a copy of the certificate from the California Secretary of State permitting the entity to transact business in California. (See Corporations Code Sections 2105, 15692, 17451.)
6. a. If registrant is a corporation, the state in which the registrant is incorporated and
date of incorporation:____________________________(State of Incorporation) _______________(Date)
b. List names and titles of corporate officers. (Attach additional page if necessary):
____________________________________________________________________________________________________
____________________________________________________________________________________________________
____________________________________________________________________________________________________ ____________________________________________________________________________________________________
7. If a partnership list all general partners. (Attach additional page if necessary.)
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
8. If a limited liability company list all managers and/or officers and their titles.
(Attach additional page if necessary.)
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
9. If registrant has listed type of ownership as "government entity" provide a brief description of the government entity, and list the names and titles of the personnel responsible for managing the sale of electricity to residential and small commercial customers. (Attach additional page if necessary.)
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
10. If registrant has listed type of ownership as "other" describe the type of ownership, list the names and titles of all managers or officers, and attach a copy of the document establishing the entity as well and the bylaws or similar governing document of the entity. (Attach additional page if necessary.)
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________ _____________________________________________________________________________________________________
11. If the type of ownership is a corporation, provide a listing of the name and address of all persons or entities that directly or indirectly own, control, or hold the power to vote ten percent or more of the outstanding voting securities of the registrant. In the alternative, attach any report required by the Securities and Exchange Commission which details such an interest.
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________
12. List all of the names and addresses of all the corporate registrant's affiliates in which the registrant owns, controls or hold five percent or more of the affiliate. If this information is contained in any report required by the Securities and Exchange Commission, that report may be submitted in lieu of the information. See the "NOTICE" section for the definition of an "affiliate."
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________ _____________________________________________________________________________________________________
_____________________________________________________________________________________________________
13. The street address and telephone number of the registrant's principal place of business if
different from current address and telephone number listed in line numbers 2 and 3:
____________________________________________________________________________________________________
Street Address
____________________________________________________________________________________________________
City State Zip Code
____________________________________________
Telephone Number
14. a. Please provide a brief description of the electrical services you plan to offer.
____________________________________________________________________________________________________
____________________________________________________________________________________________________
________________________________________________________________________________________
b. Check the box or boxes which best describe your business. (See P.U. Code Section 331.)
_ Marketer _ Aggregator _ Broker
c. Check the box or boxes which describe what customer classes you plan to serve.
_ Residential Customers _ Small Commercial Customers
_ Agricultural Customers _ Medium to Large Commercial Customers
_ Industrial Customers
d. Check the box or boxes which best describe the geographic area in which you plan to offer electrical services..
_ Statewide _ Northern California Counties
_ Central California Counties _ Southern California Counties
e. Indicate the number of customers you plan to serve. ___________
f. Indicate the average number of kWhs you expect to provide per month. ___________
15. Before you can apply to register as an electric service provider (ESP), you are required to execute a service agreement with each utility distribution company (UDC) in whose service territory you plan to do business. State the name of each UDC for which you have a signed UDC-ESP service agreement. Attach to this form an executed copy of each UDC-ESP agreement.
Name of UDCs: ____________________________________________________________________________________
a. Provide the names and titles of the key personnel that are involved in the technical and operational aspects of the business.
b. On a separate attachment, describe each key person's experience in the sale, procurement, metering, and billing of energy sources or similar products, including the time period of such experience.
c. If your company is not providing metering or billing services, provide the names of the companies who will provide those services on your behalf, and provide a description of their experience in those areas.
17. Has your company been authorized by the California Independent System Operator to act as a scheduling coordinator?
_ No _ Yes If yes, attach a copy of such authorization.
18. The name, title, address and telephone number of the person to whom correspondence or
communication regarding customer complaints or inquiries are to be addressed.
____________________________________________________________________________________________________ Name Title
_______________________________________________________________________________________________ Address
____________________________________________________________________________________________________ City State Zip Code
______________________________________
Telephone Number FAX Number E-Mail Address
(If Available) (If Available)
19. Name and Address of Agent for Service of Process:
(Must Be Located In California) (See Corporations Code Sections 1505, 15800, 17057, 17060.)
Name:_____________________________________________________________________________________________Street Address:____________________________________________________________________________________ City and State:_________________________________________________________ Zip Code:_________________
20. Has the registrant, or any of the general partners, or corporate officers or directors, or limited liability company members, managers, and officers, ever been convicted of any felony?
_ No _ Yes If yes, please explain on additional page.
0. Within the last ten years, have any of these persons had any civil, criminal, or regulatory sanctions imposed against them pursuant to any state or federal consumer protection law or regulation?
_ No _ Yes If yes, please explain on additional page.
21. Provide a full set of fingerprints of: (1) if a sole proprietorship, the registrant; (2) if a partnership, all general partners; (3) if a corporation, all corporate officers; and (4) if a limited liability company, all of the members, managers and officers. Use the fingerprint cards included with this application. Additional fingerprint cards may be obtained from the Commission. The fingerprints shall be performed by a law enforcement agency, or other person which is qualified to provide fingerprint services. The ESP registrant shall also provide the name and address of the entity or person which provided the fingerprint services, and the date on which the service was provided.
NOTICE
Each ESP registered with the California Public Utilities Commission (CPUC) should be familiar with all the laws and decisions pertaining to the offering of electrical services to customers in California. This notice mentions some of the provisions that the ESP must abide by.
If your ESP registration application is approved, you are required to provide the CPUC with a cash (cashier's check) security deposit in the minimum amount of $25,000 or post a financial guarantee bond in favor of the CPUC in that amount. For ESPs serving residential or small commercial customers, this deposit must be received by the CPUC before you sign up and initiate a direct access service request on behalf of the customer. For ESPs serving agricultural customers, medium to large commercial customers and/or industrial customers, this deposit is due at the time of registration. The deposit or financial guarantee bond shall be delivered to the Energy Division address listed on the first page of this form. In the alternative, the ESP may elect to open a customer trust account in a format approved by the CPUC's General Counsel. Pending such an approval, the ESP must post the cash deposit or the financial guarantee bond. This deposit requirement is subject to change.
Unless you are an ESP who has been authorized by the California Independent System Operator to act as a scheduling coordinator, each registered ESP is required to submit to the Energy Division a copy of all of its scheduling coordinator agreements. The agreements are to be submitted on or before the date when the ESP signs up its first customer.
Prior to signing up and initiating a direct access service request on behalf of any residential or small commercial customer, all registered ESPs serving such customers are required to provide the potential customer with a written notice which describes the price, terms, and conditions of service. The notice shall include all of the elements required by Public Utilities Code § 394.5, and the requirements set forth in the CPUC's consumer protection decision, D.98-03-072, as modified by D.99-05-034.
Public Utilities Code § 394.7 prohibits all ESPs from soliciting those residential and small commercial consumers whose names appear on the list that is maintained pursuant to that code section.
In order to change the electricity provider of a residential or small commercial customer, all ESPs must follow the verification procedures set forth in Public Utilities Code § 366.5.
Every registered ESP serving residential or small commercial customers is required to submit on a periodic basis information regarding its standard service plans. This information is to be submitted on the form adopted by the CPUC. (Public Utilities Code § 392.1(a); D.98-03-072.)
Every ESP who offers to sell electricity to end-use customers is required to disclose its electricity sources to those customers in accordance with Public Utilities Code § 398.4 and as directed by the California Energy Commission.
In addition to the $100 registration fee, you are required to pay the annual fee required by Public Utilities Code § 394.3(b). This fee is assessed on each registered ESP on September 1st of each year.
For the purposes of this form, the following definition of an "affiliate" applies:
"Affiliate" means any legal entity in which five percent or more of the outstanding shares are owned, controlled, or held with power to vote, directly or indirectly either by the ESP or any of its subsidiaries; or by the ESP's controlling entity or any of its subsidiaries; or by any company in which the ESP, its controlling entity, or any of the ESP's affiliates, exert substantial control over the operation of the company or indirectly have substantial financial interests in the company which is exercised through means other than ownership. For purpose of this definition, "substantial control" include, but is not limited to, the possession, directly or indirectly and whether acting alone or in conjunction with others, of the authority to direct or cause the direction of the management or policies of the company. A direct or indirect voting interest of five percent or more by the ESP in an entity's company creates a rebuttable presumption of control.
Any material change in the information required by this form shall be provided to the CPUC within 60 days, except for any change in the ESP's telephone number or address, which shall be reported within five days of such a change. (Public Utilities Code § 394.1(d).)
Submit the original signed form, plus three copies of the signed form, together with all required documents. We suggest you retain a copy of this completed form for your records.
DECLARATION
If this registration form is verified outside of California, the verification must be made by an affidavit sworn or affirmed before a notary public.)
I, (print name and title) ___________________________________________________________ hereby certify that I am empowered to act on behalf of _______________________________________________ (registrant's name) and to make this application on its behalf. I declare under the penalty of perjury under the laws of the State of California that I have read the above notice, that the above statements and information submitted in connection with this application are true and correct, and that any documents furnished in connection with this application are true and correct copies.
Dated this ___________________________________________ , at _____________________________________________
(date) (place of execution)
Signature:__________________________________________________________
