VI. Customer Notices (Utility Tariff Section H and Section I)

Section 366.2 (c)(13) requires the CCA to send notices to prospective customers so each customer is able to make informed decisions about whether to take service by the CCA or "opt-out" of CCA service and remain as a utility bundled customer. The law requires the CCA to send two notices before the switch-over and two notices after the switch-over.

The utilities presented a standardized notice to customers that is similar to the one the Commission requires ESPs to send direct access customers, pursuant to D.98-03-072. Utilities express concerns that CCAs cannot be relied upon to provide good information to customers and should not have discretion to create their own notices.

The CCAs propose that a CCA's notice be reviewed and approved by the Commission's public advisor to assure the notice is adequate and accurate. CCAs and King's River oppose the utilities' proposal to oversee the CCA's notices in any way. The CEC comments the list of items the utilities would include in the CCA's billing notice would confuse and overwhelm customers. Local Power advocates in favor of the Commission requiring the utilities to include CCA notices in utility bills.

Discussion. Section 366.2(c) (13) requires the CCA to notify customers of its plans to provide service and the customer's option to remain with the utility as a bundled customer. It also permits the Commission to order the utility to mail the notices, at cost, in regular monthly bills.

With regard to the type of information to be provided to customers in the notices, we have no reason to assume an agency of local government is incapable of complying with the statute and providing reasonable notice to potential customers. We appreciate the CCAs' willingness to work with our Public Advisor whose expertise in this area will help assure the notices are clear, complete and easy to understand.

We also direct the utilities to include in their tariffs a cost-based service that permits CCAs to include their customer notices in utility bills. We order this service offering because it may provide a more efficient way to notify customers than requiring the CCAs to mail notices separately. Because AB 117, a state statute, permits the Commission to require this service to CCAs, we do not address the relevance of the US Supreme Court's decision in PG&E Co v. PUC (475 US 1, 1986), which found that PG&E did not have to permit a third party to use the "empty space" in PG&E's monthly bills. Suffice to say, the information in CCA notices would directly affect PG&E's services to existing customers, would be a communication of a government agency, and would be reimbursed at cost, all of which distinguish the circumstances here from those presented to the Court in the PG&E v. PUC case.

We adopt the CCA's proposed tariff language that provides that the customer would become a CCA customer if the customer notice were to be returned to the utility unopened. AB 117 requires that every customer be served by the CCA unless the customer opts-out of the CCA's service. Because an unopened letter is not a proxy for a customer's opting out of CCA service, the customer must be assigned to the CCA. The customer will subsequently receive effective notice of his assignment to the CCA in the bill and may choose to opt out at a later date.

Further, we reject the utilities' proposal that customers with commodity contracts must opt-in to be served by the CCA. Section 366.2(C) (2) states clearly that "If no negative declaration is made by a customer, that customer shall be served through the community choice aggregator program." The statute makes no exception for customers with commodity contracts. The utilities must therefore cut-over such customers to be served by the CCA unless those customers have provided a declaration stating a wish to remain with the utility. Customers with contracts that provide for penalties for failure to fulfill the contract terms would be subject to those penalties if they fail to opt-out of service with the CCA. We encourage the utility and the CCA to inform such customers of the potential contractual impacts of taking service from the CCA.

Finally, we agree with TURN and the CCAs that utilities should not be permitted to market their services. We do not see any benefit from permitting a battle for market share between CCAs and utilities. Of course, utilities may answer questions about their own rates and services and the process by which utilities will cut-over customers to the CCA. They may not, however, provide information about CCA rates or services, or affirmatively contact customers in efforts to retain them.