PROPOSED RULEMAKING
PENNSYLVANIA PUBLIC
UTILITY COMMISSION
[52 PA. CODE CHS. 3 AND 62]
[L-00000150]
Licensing Requirements for Natural Gas Suppliers
[30 Pa.B. 3073] The Pennsylvania Public Utility Commission (Commission) on April 13, 2000, adopted a proposed rulemaking order establishing licensing requirements for natural gas suppliers. The contact persons are Robert Bennett, Bureau of Fixed Utility Services, (717) 787-5553 and Patricia Krise Burket, Law Bureau, (717) 787-3464.
Executive Summary
On June 22, 1999, Governor Thomas J. Ridge signed into law the Natural Gas Choice and Competition Act, 66 Pa.C.S. §§ 2201--2212 (act). Under the act, beginning on November 1, 1999, retail customers have had the ability to choose their natural gas supplier. Previously, consumers procured their natural gas supply requirements as a package from the jurisdictional public utility. The package included what are now the basic components of competitive natural gas supply service, commodity, capacity and storage, balancing and aggregation services of the natural gas utility.
On July 15, 1999, the Commission issued a final order which adopted interim licensing procedures and a license application. These interim licensing procedures were to be temporary in nature, and would be replaced by regulations. As the first step in promulgating these regulations, the Commission has revised its interim licensing procedures and has redrafted them as proposed regulations.
Through these proposed regulations, the Commission is seeking comments and reply comments from interested parties.
Regulatory Review
Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), on June 2, 2000, the Commission submitted a copy of these proposed amendments to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House and Senate Committees. In addition to submitting the proposed amendments, the Commission has provided IRRC and the Committees with a copy of a detailed Regulatory Analysis Form prepared by the Commission in compliance with Executive Order 1996-1, ''Regulatory Review and Promulgation.'' A copy of this material is available to the public upon request.
Under section 5(g) of the Regulatory Review Act, if IRRC has objections to any portion of the proposed amendments, it will notify the Department within 10 days of the close of the Committees' review period. The notification shall specify the regulatory review criteria that have not been met by the portion of this proposal to which an objection is made. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the amendments, by the Commission, the General Assembly and the Governor of objections raised.
Commissioners Present: John M. Quain, Chairperson; Robert K. Bloom, Vice Chairperson; Nora Mead Brownell; Aaron Wilson, Jr.; Terrance J. Fitzpatrick
Public Meeting held
April 13, 2000Licensing Requirements for Natural Gas Suppliers; 52 Pa. Code Chapter 62; Doc. No.: L-00000150
Proposed Rulemaking Order On June 22, 1999, Governor Thomas J. Ridge signed into law the Natural Gas Choice and Competition Act, 66 Pa.C.S. §§ 2201--2212 (act). Under the act, beginning on November 1, 1999, retail customers have had the ability to choose their natural gas supplier. Previously, consumers procured their natural gas supply requirements as a package from the jurisdictional public utility. The package included what are now the basic components of competitive natural gas supply service, commodity, capacity and storage, balancing and aggregation services of the natural gas utility. The section 2202 of the act (relating to definitions) defines a natural gas supplier as:
An entity other than a natural gas distribution company, but including natural gas distribution company marketing affiliates, which provides natural gas supply services to retail gas customers utilizing the jurisdictional facilities of a natural gas distribution company. The term includes a natural gas distribution company that provides natural gas supply outside its certificated service territories. The term includes a municipal corporation, its affiliates or any joint venture, to the extent that it chooses to provide natural gas supply services to retail customers located outside of its corporate or municipal limits, as applicable, other than:(i) as provided prior to the effective date of this chapter, pursuant to a certificate of public convenience if required under this title;(ii) total natural gas supply services in de minimis amounts;(iii) natural gas supply services requested by, or provided with the consent of, the public utility in whose certificated territory the services are provided; or(iv) natural gas supply services provided to the municipal corporation itself or its tenants on land it owns or leases, or is subject to an agreement of sale or pending condemnation, as of September 1, 1999, to the extent permitted by applicable law independent of this chapter.The term excludes an entity to the extent that it provides free gas to end-users under the terms of an oil or gas lease. Notwithstanding any other provision of this title, a natural gas supplier that is not a natural gas distribution company is not a public utility as defined in section 102 (relating to definitions) to the extent that the natural gas supplier is utilizing the jurisdictional distribution facilities of a natural gas distribution company or is providing other services authorized by the Commission.66 Pa.C.S. § 2202.
As used in the definition of a natural gas supplier, the term natural gas supply services includes (i) the sale or arrangement of the sale of natural gas to retail customers; and (ii) services that may be unbundled by the Commission under section 2203(3) of the act (relating to standards for restructuring of the natural gas utility industry). Natural gas supply service does not include distribution service. See 66 Pa.C.S. § 2202.
On June 24, 1999, the Commission issued a Tentative Order and draft licensing application for interim licensing of natural gas suppliers pending the promulgation of regulations. The Tentative Order established a comment period ending July 9, 1999, and was served on the Office of Consumer Advocate, the Office of Small Business Advocate, Pennsylvania jurisdictional gas utilities, and other interested parties. The Commission's order was also posted on the Commission's website. Comments were received from numerous parties.
On July 15, 1999, the Commission adopted a Final Order which set forth interim licensing procedures and a license application. Re: Requirements for Natural Gas Suppliers--Guidelines pursuant to Chapter 22 Natural Gas Choice and Competition Act Section 2208, order entered July 16, 1999 at Doc. No. M-00991248F0002.
In its July 16, 1999 Order, the Commission recognized that the interim licensing procedures were to be temporary in nature, and that they would be replaced by regulations. As the first step in promulgating these regulations, the Commission has revised its interim licensing procedures and has redrafted them as proposed regulations.
The Commission seeks general comments on the proposed regulations. Persons submitting comments are requested to provide supporting justification for requested revisions, and propose suggested regulatory language for incorporation into the final-form regulations.
While the proposed rulemaking is derived predominantly from the interim licensing guidelines, the Commission has included in the proposed regulations provisions that exempt from licensing nontraditional marketers and marketing services consultants that work as agents for a licensed natural gas supplier under certain restrictions. The restrictions are that the supplier is the financially responsible party: (1) for the provision of natural gas supply services to retail customers; and (2) for all unlawful acts committed by the agent. Nontraditional marketers include community-based organizations, civic, fraternal or business associations, common interest groups that endorse a supplier's services to their members or constituents (nontraditional marketers). Marketing services consultants are commercial entities, such as telemarketing firms and auction-type websites, that are under contract as an agent to a licensed supplier and that market natural gas supply services to consumers on the supplier's behalf.
The definition of ''natural gas supplier'' in section 2202 of the act is very broad, and our initial interpretation of the law had been that every entity that engages in an activity listed as that undertaken by a natural gas supplier must be licensed. However, we have come to recognize that some of these activities may be undertaken by entities like those listed previously who will not have any direct physical or financial responsibility for the procurement of the customer's natural gas. Under these circumstances, we do not believe that the public interest requires that these entities comply with the licensing requirements. Comment is specifically requested on these exemptions.
In addition, the proposed rulemaking would develop different financial surety mechanisms intended to facilitate customer choice for the gas industry contrasted with those in force for customer choice in the electric industry. This treatment may be extended to other areas as well.
The Commission seeks particular comment on whether, and to what extent, disparate treatment between industries is appropriate in the proceeding as a matter of law and policy. The Commission is interested in developing final regulations and policies that reflect the increased probability of gas and electric convergence in this Commonwealth.
Accordingly, under 66 Pa.C.S. §§ 501, 2203(12) and 2208 and the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. §§ 1201--1208), and regulations promulgated thereunder in 1 Pa. Code §§ 7.1--7.4, we propose to amend the regulations in 52 Pa. Code by amending §§ 3.551 and 62.101--62.115 as previously noted and to read as set forth in Annex A; Therefore,
It Is Ordered That:
1. A rulemaking docket shall be opened to promulgate regulations for the licensing of natural gas suppliers as set forth in Annex A.
2. The Secretary shall submit this order and Annex A to the Office of the Attorney General for preliminary review as to form and legality.
3. The Secretary shall submit a copy of this order, together with Annex A, to the Governor's Budget office for review of fiscal impact.
4. The Secretary shall submit this order and Annex A for review and comments by the designated standing committees of both houses of the General Assembly, and for review and comments by IRRC.
5. The Secretary shall certify this order and Annex A and deposit them with the Legislative Reference Bureau for publication in the Pennsylvania Bulletin.
6. Within 30 days of this order's publication in the Pennsylvania Bulletin, an original and 15 copies of any comments concerning this order shall be submitted to the Pennsylvania Public Utility Commission, P. O. Box 3265, Harrisburg, PA 17105-3265. One copy of a diskette containing the comments in electronic format should also be submitted.
7. A copy of this order and Annex A be served on the Office of Consumer Advocate, the Office of Small Business Advocate, all natural gas distribution companies and all licensed natural gas suppliers, posted on the Commission's web site at http://puc.paonline.com, and provided to all interested persons.
8. Alternate formats of this document are available to persons with disabilities and may be obtained by contacting Sherri DelBiondo, Regulatory Coordinator, Law Bureau at (717) 772-4597.
JAMES J. MCNULTY,
SecretaryFiscal Note: 57-217. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 52. PUBLIC UTILITIES
PART I. PUBLIC UTILITY COMMISSION
Subpart A. GENERAL PROVISIONS
CHAPTER 3. SPECIAL PROVISIONS
Subchapter H. FORMS § 3.551. Official forms.
The following is a list of forms which may be obtained from the Office of the Secretary of the Commission.
* * * * * (16) Application for natural gas supplier license.
(Editor's Note: The following subchapter is new. It has been printed in regular type to enhance readability.)
Subpart C. FIXED SERVICE UTILITIES
CHAPTER 62. NATURAL GAS SUPPLY
CUSTOMER CHOICE
Subchapter D. LICENSING REQUIREMENTS
FOR NATURAL GAS SUPPLIERSSec.
62.101. Definitions. 62.102. Scope of licensure. 62.103. Application process. 62.104. Application form. 62.105. Change in organizational structure or operational status. 62.106. Open and nondiscriminatory access. 62.107. Publication of notice of filing. 62.108. Protests to applications. 62.109. Approval. 62.110. Regulatory assessments. 62.111. Reporting requirements. 62.112. Bonds or other security. 62.113. Transfer or abandonment of license. 62.114. License suspension; license revocation. 52.115. Standards of conduct and disclosure for licensees. § 62.101. Definitions.
The following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise:
Act--The Natural Gas Choice and Competition Act (66 Pa.C.S. §§ 2201--2212).
Applicant--A person or entity seeking to obtain a license to supply retail natural gas supply services to retail customers.
City natural gas distribution operation--A collection of real and personal assets used for distributing natural gas to retail gas customers owned by a city or a municipal authority, nonprofit corporation or public corporation formed under section 2212(m) of the act (relating to city natural gas distribution operations).
License--A license granted to an NGS under this subchapter.
Licensee--A person or entity that has obtained a license to provide natural gas supply services to retail customers.
Marketing--The publication, dissemination or distribution of informational and advertising materials regarding the NGS's services and products to the public by personal contact, print, broadcast, electronic media, direct mail or by telecommunication.
Marketing services consultant--A commercial entity, such as a telemarketing firm or auction-type website, that under contract to a licensee, acts as an agent to market natural gas supply services to retail gas customers for the licensee. A marketing services consultant:
(i) Does not collect revenues directly from retail customers.
(ii) Is not responsible for the scheduling of natural gas supplies.
(iii) Is not responsible for the payment of the costs of the natural gas to suppliers, producers or NGDCs.
NGDC--Natural Gas Distribution Company--A public utility or city natural gas distribution operation that provides natural gas distribution services and which may provide natural gas services and other services.
NGS--Natural Gas Supplier--An entity other than an NGDC, including an NGDC's marketing affiliates, which provides natural gas supply services to retail gas customers utilizing the jurisdictional facilities of an NGDC.
(i) The term includes an NGDC that provides natural gas supply services outside its certificated service territories.
(ii) The term includes a municipal corporation, its affiliates or any joint venture to the extent that it chooses to provide natural gas services to retail customers located outside its corporate or municipal limits, as applicable, other than:
(i) As provided prior to July 1, 1999, the effective date of the act, under a certificate of public convenience if required.
(ii) Total natural gas supply services in de minimis amounts.
(iii) Natural gas supply services requested by or provided with the consent of the public utility in whose certificated territory the service is provided.
(iv) Natural gas supply services provided to the municipal corporation itself or its tenants on land it owns or leases, or is subject to an agreement of sale or pending condemnation, as of September 1, 1999, to the extent permitted by applicable law.
Natural gas supply services--The term includes:
(i) The sale or arrangement of the sale of natural gas to retail gas customers.
(ii) Services that may be unbundled by the Commission under section 2203(3) of the act (relating to standards for restructuring of natural gas utility industry).
Nontraditional marketer--A community-based organization, civic, fraternal or business association, common interest group or commercial entity that works with a licensed supplier as an agent to market natural gas supply services to its members or constituents. A nontraditional marketer:
(i) Conducts its transactions through a licensed NGS.
(ii) Does not collect revenues directly from retail customers.
(iii) Does not require its members or constituents to obtain its natural gas service through the nontraditional marketer or a specific licensed NGS.
(iv) Is not responsible for the scheduling of natural gas supplies.
(v) Is not responsible for the payment of the costs of the natural gas to its suppliers or producers.
Offer to provide service--The extension of an offer to provide services or products communicated orally or in writing to a customer.
Retail gas customer--A direct purchaser of natural gas supply services or natural gas distribution services, other than an NGS.
Supplier of last resort--A supplier approved by the Commission under section 2207(a) of the act (relating to obligation to serve) to provide natural gas supply services to customers who contracted for natural gas that was not delivered, or who did not select an alternative NGS, or who are not eligible to obtain competitive natural gas supply, or who return to the supplier of last resort after having obtained competitive natural gas supply.
§ 62.102. Scope of licensure.
(a) An NGS may not engage in marketing, or may not offer to provide, or provide natural gas supply services to retail customers until it is granted a license by the Commission.
(b) An NGDC acting within its certified service territory as a supplier of last resort is not required to obtain a license.
(c) The owners/operators of a building or facility that manages the internal distribution system supplying a building or facility and supplies natural gas and other related services to occupants of the building or the facility where the owner/operators, and not the occupants, are the direct purchasers of the natural gas supply services are not required to obtain a license.
(d) A nontraditional marketer is not required to obtain a license. Each nontraditional marketer and each licensed NGS shall provide the Commission with a copy of their agreement to market natural gas supply services to retail customers prior to the nontraditional marketer engaging in any natural gas supply service sales activity. The licensed natural gas supplier shall be responsible for violations of 66 Pa.C.S. (relating to the Public Utility Code) and applicable regulations of this title, orders and directives committed by the nontraditional marketer and fraudulent, deceptive or other unlawful marketing or billing acts committed by the nontraditional marketer.
(e) A marketing services consultant is not required to obtain a license. Each marketing services consultant and each licensed NGS shall provide the Commission with a copy of its agreement to market natural gas supply services to retail customers prior to the marketing services consultant engaging in any natural gas supply service sales activity. The licensed NGS shall be responsible for violations of 66 Pa.C.S. and applicable regulations of this title, orders and directives committed by the marketing services consultant and fraudulent, deceptive or other unlawful marketing or billing acts committed by the marketing services consultant.
§ 62.103. Application process.
(a) An application for a license shall be made on the form provided by the Commission. A copy of the application can be obtained from the Commission's Secretary. The application form is also available on the Commission's web site. An application shall be verified by an oath or affirmation as required in § 1.36 (relating to verification). See section 2208(b) of the act (relating to requirements for natural gas suppliers).
(b) An original and eight copies of the completed application and supporting attachments shall be filed. An electronic copy of the application shall also be filed. An application for a license shall be accompanied by the application fee as established in § 1.43 (relating to schedule of fees payable to the Commission).
(c) Copies of the completed applications with supporting documentation shall be served on the following:
(1) The Office of Consumer Advocate.
(2) The Office of Small Business Advocate.
(3) The Office of the Attorney General.
(4) The Bureau of Consumer Protection.
(5) The Department of Revenue, and each NGDC in whose service territory the applicant intends to provide natural gas supply services.
(d) Incomplete applications and those without supporting attachments, if needed, will be rejected without prejudice. The license application, with supporting attachments, shall be completed in its entirety.
(e) When an answer on the application requires the disclosure of privileged or confidential information not otherwise available to the public, the applicant may designate at each point in the application where information is disclosed that is confidential and privileged. One copy of this confidential or privileged information conspicuously marked at the top as ''CONFIDENTIAL'' may be submitted to the Office of the Secretary with the application.
(1) An applicant shall provide reasons for protecting this information.
(2) The request for confidentiality will be treated as a petition for protective order and will be ruled on by the Commission in conjunction with the license application.
(3) Pending disposition, the information will be used solely for the purpose of evaluating the license application, and the confidentiality of this information will be maintained consistent with the Commission's rules and regulations pertaining to confidentiality.
§ 62.104. Application form.
(a) The application form includes information that will be used in the evaluation of the financial fitness and technical fitness to render service. Information includes:
(1) Identification of the geographic area that the applicant proposes to serve.
(2) Identification of the type of service that the applicant proposes to furnish.
(3) Identification of the class of customers to which the applicant proposes to provide these services.
(4) Identification of the applicant's utility affiliates.
(5) Description of the applicant's business structure.
(6) Financial information sufficient to demonstrate financial fitness. This information may include credit ratings and history, audited financial statements and insurance pertinent to the conduct of the applicant's business as an NGS.
(7) Evidence of competency and experience in providing the scope and nature of the applicant's proposed services. This evidence may include:
(i) Descriptions of the applicant's prior experience.
(ii) Proposed staffing and employe training commitments.
(iii) Business plans and agreements.
(iv) Arrangements and contracts for natural gas supply procurement, transmission and related services.
(8) Evidence of information demonstrating the applicant's ability to comply with Commission applicable requirements concerning customer billing, customer education, billing and terms of service and customer information. This evidence may include:
(i) Prior regulatory experience of the applicant.
(ii) Prior business experience in energy or other service-oriented industries.
(iii) Staffing and staff training commitments, agreements.
(iv) Arrangements and contracts for customer education and information service.
(v) Customer satisfaction survey results.
(vi) Government agency reports.
(vii) Complaint statistics compiled by the Better Business Bureau or similar business organizations.
(9) Certification that notice of the application was published in accordance with § 54.35 (relating to publication of notice of filing) shall be filed with the Commission's Secretary. The certification shall be notarized and include a photostatic copy of the notices as published. An application will not be considered complete for Commission review without this certification.
(b) Additional information that shall be submitted in support of the application includes:
(1) The name, address, telephone number, electronic numbers and addresses used to transmit tax and related information of the persons responsible for preparing and filing the applicant's Pennsylvania tax returns.
(2) The trade names or fictitious names used by the applicant.
(3) The type of business association (for example, sole proprietor, partnership or corporation).
(4) The names of the owners, general partners or corporate officers.
(5) The number of applicant's current and anticipated employes working in this Commonwealth.
(6) An identification of the applicant's assets in this Commonwealth.
(7) The principal office in this Commonwealth or of its registered agent.
(8) The applicant's Department of Revenue tax identification numbers including Sales Tax license number, employer identification number and corporate box number.
§ 62.105. Change in organizational structure or operational status.
(a) The applicant is under a duty to inform the Commission of a material change in the information provided in the application during the pendency of the application, or while the licensee is operating in this Commonwealth.
(b) A material change in the organizational structure or operation that affects an applicant's or a licensee's operation in this Commonwealth shall be reported to the Commission within 30 days of the date of the change. Specifically, notification shall be given to the Commission of a change in the following:
(1) Affiliation with an NGDC.
(2) Affiliation with an entity that has a franchised service area.
(3) Affiliation with other NGS.
(4) Affiliation with licensed electric generation supplier.
(5) Office location.
(6) Chief executive officer or operating partners.
(7) Customer classes served expanded to include residential and small commercial customers.
(c) Unless directed otherwise by the Commission, the licensee does not need to file an amended application with the Commission.
§ 62.106. Open and nondiscriminatory access.
A municipal corporation shall, before it is permitted to provide natural gas supply services as a licensed NGS, demonstrate, and the Commission will determine, that by the date of the issuance of the license, it will provide other NGSs open and nondiscriminatory access to its gas distribution system under standards that are comparable to those found in the act, taking into consideration the particular circumstances of the municipal corporation's ownership or operation, or both, of its natural gas distribution system.
§ 62.107. Publication of notice of filing.
(a) Notice of filing an application shall be published in newspapers of general circulation covering each county in which the applicant intends to provide service as required by § 5.14(a)(2) (relating to applications requiring notice). Applicants may contact the Commission's Press Secretary to confirm the identity of the newspapers of general circulation in which notice shall be published.
(b) The notice shall be written in plain language and include the name, address and telephone number of the applicant, a description of the proposed service or services to be provided and the geographic area to be served.
(1) The notice shall include the application docket number and a statement that protests related to the technical or financial fitness of the applicant shall be filed within 15 days of the publication date of the notice with the Commission's Secretary, Public Utility Commission, P. O. Box 3265, Harrisburg, Pennsylvania 17105-3265.
(2) The notice in an acceptable electronic format shall be submitted to the Commission's Secretary for posting on the Commission's Internet web site.
§ 62.108. Protests to applications.
(a) Consistent with § 5.14(b) (relating to applications requiring notice), a 15-day protest period commences on the date notice of the application filing is published in newspapers. An interested party may file a protest to an application in compliance with § 5.52(a) (relating to content of a protest to an application) and shall set out clearly and concisely the facts upon which challenge to the fitness of the applicant is based. An applicant may file an answer to the protest within 10 days of when the protest is filed. Protests which do not fully comply with § 5.52(a) (relating to content of a protest to an application) will be rejected.
(b) Protests may challenge only the applicant's financial and technical fitness to provide the service for which a license is requested. Consistent with the requirements of due process, sanctions, such as revocation or suspension of a supplier's license or the imposition of a fine, may be imposed on parties who intentionally misuse the protest process by repeated filing of competitive protests.
(c) A protest to the applicant's technical or financial fitness to provide service will be assigned to Commission staff for review. Staff will determine if the protest fully complies with § 5.52(a) and sets out clearly and concisely the facts upon which the challenge to the fitness of the applicant is based.
(1) Staff will determine if the protest is sufficiently documented.
(2) If a protest is not sufficiently documented, Commission staff will prepare a recommendation for Commission consideration dismissing the protest and granting the application.
(3) If a protest is sufficiently documented, the application will be transferred to the Office of Administrative Law Judge for hearings or mediation as deemed appropriate.
§ 62.109. Approval.
(a) A license will be issued, authorizing the whole or any part of service requested, if the Commission finds that:
(1) The applicant is fit, willing and able to properly perform the service proposed in conformance with applicable provisions of 66 Pa.C.S. (relating to the Public Utility Code) and the lawful Commission orders and regulations, specifically including Chapter 56 (relating to standards and billing practices for residential utility service).
(2) The proposed service is consistent with the public interest and the policy declared in the act. (See 66 Pa.C.S. § 2208(b) (relating to requirements for natural gas suppliers)).
(b) Completed applications, with all supporting documentation, including any documentation or clarifying information requested by Commission staff, if unprotested, will be processed within 45 days after acceptance by the Commission. If the application is not processed within the time period, the application will be deemed approved. The review period may be extended for a reasonable period of time by Secretarial Letter.
§ 62.110. Regulatory assessments.
(a) A licensee shall be required to pay assessments to be used to defray regulatory costs. See 66 Pa.C.S. § 510 (relating to assessment for regulatory expenses upon public utilities).
(1) Assessments will be based upon the administrative costs incurred by the Commission related to suppliers.
(2) These costs include:
(i) Maintaining records related to licensees, and administering other provisions of 66 Pa.C.S. (relating to the Public Utility Code) related to maintenance of adequate reserve margins.
(ii) Compliance with Chapter 56 (relating to standards and billing practices for residential utility service).
(iii) Fulfilling consumer information and education obligations.
(b) Yearly assessments shall be paid by the licensee within 30 days of receipt of notice of the amount lawfully charged against it as a condition of maintaining a license to supply natural gas. See 66 Pa.C.S. § 510(c).
§ 62.111. Reporting requirements.
(a) A licensee shall file an annual report on or before April 30 of each year, for the previous calendar year. The annual report shall contain the following information:
(1) The total amount of gross receipts from the sales of natural gas supply services for the preceding calendar year.
(2) The total amount of natural gas sold during the preceding calendar year.
(b) A licensee shall be required to meet periodic reporting requirements issued by the Commission to fulfill the Commission's duty under the act pertaining to reliability and to inform the Governor and the General Assembly of the progress to a fully competitive natural gas market.
(c) The information requested in this section will be made available for public review upon request to the Commission subject to any rulings on confidentiality made by the Commission.
§ 62.112. Bonds or other security.
(a) A license will not be issued or remain in force until the licensee furnishes proof of a bond or other security. See section 2208(c)(1)(i) of the act (relating to requirements for natural gas suppliers).
(b) The purpose of the security requirement is to ensure the licensee's financial responsibility. See section 2208(c)(1)(i) of the act.
(c) The amount and the form of the security, if not mutually agreed upon by the NGDC and the licensee, shall be reasonably based on the criteria established in this section. The criteria shall be applied in a non-discriminatory manner. The Commission will periodically review the established criteria upon petition by any party.
(1) The amount of the security should be reasonably related to the financial exposure imposed on the NGDC or supplier of last resort resulting from the default or bankruptcy of the licensee. At a minimum, the amount of security should materially reflect the difference between the cost of gas incurred and the supplier's charges, if any, incurred by the NGDC or supplier of last resort during one billing cycle.
(i) The amount of security established under this paragraph may be modified based on one, or more of the following:
(A) The licensee's past operating history, including the length of time that the licensee operated on the NGDC's system, the number of customers served and past supply reliability problems.
(B) The licensee's credit reports.
(C) The number and class of customers being served.
(D) Information that materially affects a licensee's creditworthiness.
(E) The licensee's demonstrated capability to provide the volume of natural gas necessary for its customers' needs.
(ii) The amount of the security may be adjusted, but not more often than every 6 months. The adjustments shall be reasonable and based on one or more of the following criteria:
(A) Changes in a licensee's recent operating history on the NGDC's system.
(B) Changes in a licensee's credit reports.
(C) Changes in the number or class of customers being served by the licensee.
(D) Changes in circumstances that materially affect a licensee's creditworthiness.
(E) The licensee's demonstrated capability to provide the volume of natural gas necessary for its customers' needs.
(2) The following legal and financial instruments and property shall be acceptable as security:
(i) Bond.
(ii) Irrevocable letter of credit.
(iii) Corporate, parental or other third-party guaranty.
(3) In addition to the requirements in this section, small suppliers with annual operating revenues of less than $1 million may utilize real or personal property with the following supporting documentation acceptable as security:
(i) A verified statement from the licensee that it has clear title to the property and that the property has not been pledged as collateral, or otherwise encumbered in regard to any other legal or financial transaction.
(ii) A current appraisal report of the market value of the property.
(d) The licensee shall submit to the Commission documentation demonstrating that it has complied with the bonding or security requirement. One copy of each bond, letter of credit, or other financial or legal instrument or document evidencing an agreement between the licensee and the NGDC shall be submitted to the Commission.
(e) Licensee liability for unreasonable service, or for violations of 66 Pa.C.S. (relating to the Public Utility Code) and Commission orders and regulations is not limited by these security requirements.
§ 62.113. Transfer or abandonment of license.
(a) A license may not be transferred without prior Commission approval. See section 2208(d) of the act (relating to requirements for natural gas suppliers). Approval for transfer shall be obtained by petition to the Commission. The granting of a petition does not eliminate the need for the transferee to complete and file with the Commission an application that demonstrates the transferee's financial and technical fitness to render service under the transferred license.
(b) A licensee may not abandon service without providing 90 days prior written notice to the Commission, the licensee's customers, the affected distribution utilities and suppliers of last resort. The licensee shall provide written individual notice to its customers at approximately 90 days and 60 days preceding the effective date of the abandonment.
§ 62.114. License suspension; license revocation.
(a) A licensee shall comply with the applicable requirements of 66 Pa.C.S. (relating to the Public Utility Code) and Commission regulations and orders. Consistent with due process, a license may be suspended or revoked, and fines may be imposed against the licensee for:
(1) Failure to pay the yearly assessment.
(2) Failure to furnish and maintain a bond or other security.
(3) Failure to comply with the rules, regulations, orders or directives of the Department of Revenue.
(4) Failure to provide the address of its current principal office in this Commonwealth or of its registered agent.
(5) Failure to follow the principles in § 62.115 (relating to standards of conduct and disclosure for licensees).
(6) Violation of applicable provisions of 66 Pa.C.S., Commission regulations and lawful Commission orders. See section 2208(c)(2) of the act (relating to requirements for natural gas suppliers).
(7) Violation of Pennsylvania consumer protection law.
(b) The unauthorized transfer by a NGDC, or its affiliate, of a customer's NGS without the customer's express consent will result in a fine, or the suspension, or the revocation of the license of that NGDC's affiliated NGS. See section 2206(b) of the act (relating to consumer protection and customer service).
(c) The unauthorized transfer by a licensed NGS, or its affiliate, of a customer's NGS without the customer's express consent will result in a fine, or the suspension, or the revocation of the license of that NGS.
§ 62.115. Standards of conduct and disclosure for licensees.
To protect the consumers of this Commonwealth, licensees shall adhere to the following principles in the provision of natural gas service:
(1) A licensee shall provide accurate information about its natural gas services using plain language and common terms in communications with consumers. When new terms are used, the terms shall be defined again using plain language.
(2) A licensee shall provide notification of change in conditions of service, intent to cease operation as a natural gas supplier, explanation of denial of service, proper handling of deposits and proper handling of complaints in accordance with this title.
(3) A licensee shall maintain the confidentiality of a consumer's personal information including the name, address and telephone number, and historic payment information, and provide the right of access by the consumer to the consumer's own load and billing information.
(4) A licensee may not discriminate in the provision of natural gas as to availability and terms of service based on race, color, religion, national origin, sex, marital status, age, receipt of public assistance income and exercise of rights under the Consumer Credit Protection Act (15 U.S.C.A. §§ 1601--1693c). See 15 U.S.C.A. §§ 1691--1691f (relating to equal credit opportunity); and 12 CFR Part 202 (relating to equal credit opportunity (Regulation B)).
(e) A licensee is responsible for the fraudulent, deceptive or other unlawful marketing or billing acts performed by the licensee, its employes, agents or representatives. A licensee shall inform consumers of state consumer protection laws that govern the cancellation or rescission of natural gas supply contracts. See section 7 of the Unfair Trade Practices and Consumer Protection Law (73 P. S. § 201-7).
(f) A licensee shall comply with relevant Commission regulations, orders and directives that may be adopted.
[Pa.B. Doc. No. 00-1044. Filed for public inspection June 16, 2000, 9:00 a.m.]
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