Virginia

Restructuring Overview  |  Restructuring Resources  |  Consumer Protection

Legislation Passed
Electric Y Gas Y

Electric:

1998, HB 1172; Virginia Electric Utility Restructuring Act; sets general restructuring guidelines.

1999, SB 1269; enacted one year later, provides details.

2000, SB 585; makes some modifications.

2001, SB 1420; makes some modifications to Virginia Electric Utility Restructuring Act

Gas:

1999, SB 1105; authorizes gas utilities operating in Virginia to offer retail supply choice to all their customers.

2000, SB 185; authorizes gas suppliers, pipeline distribution companies, and gas utilities to file a retail supply choice plan that includes provisions to implement the program, methodology to recover stranded costs, proposed unbundled rates and terms, and provisions to insure that one class of customer does not subsidize another class. The bill would also create a natural gas consumption tax, which would be added to the consumer's bill. This bill is identical to HB 279.

Electric
Overview

• AEP-Virginia, Allegheny Power and Conectiv opened their entire service territories to retail choice on January 1, 2002. All customers of these companies have the opportunity to choose a competitive service provider.
• Dominion Virginia Power is phasing in choice over the next 12 months. Residential customers in Northern Virginia got the opportunity to choose on January 1, along with one-third of the company's non-residential load throughout its service territory. Residential customers in Central Virginia along with another one-third of the company's non-residential load, will have choice beginning September 1, 2002. Residential customers in the Tidewater region and the final one-third of non-residential customers receive choice on January 1, 2003.
• Rates will be regulated until 2007, although, beginning in 2004, the SCC can end the rate caps if it finds an effectively competitive generation market. After the expiration of rate caps, default service rates must be based on market prices.

Choice Status

• Beginning January 1, 2002, customers of American Electric Power Supply (AEP) in southwest Virginia could start shopping for electricity from alternative suppliers. An estimated one million customers will have access to choice programs in 2002; three million by January 1, 2003; and the rest by January 2004.
• According to a report released in August 2002 by the Virginia State Corporation Commission, only 2,500 residential electric customers have switched to alternative suppliers.

Natural Gas
Overview

• Since July 1, 2000, Virginia law has allowed utilities to offer statewide customer choice programs if approved by the State Corporation Commission (SCC). As of November 2001, four marketers were actively serving residential natural gas customers.
• Effective April 1, 2001, Washington Gas Light became the first utility with authorization to permit all of its customers in the state to buy their natural gas directly from a certified, retail energy supplier. The program is being phased in during a one-year period, with choice available at first to 150,000 residential customers and then to the rest of the company's residential customers in the state in January 2002.
• Columbia Gas of Virginia has been conducting a pilot choice program for residential customers since October 1997 in selected northern Virginia counties. In June 2002, the SCC approved the company's request to expand the pilot before the onset of the 2002-03 heating season. The pilot will give about 200,000 customers choice of a natural gas supplier. Columbia Gas will recover transition costs and costs for maintaining pipeline and storage capacity with a new monthly "transition costs recovery charge."
• On June 20, 2001, the SCC adopted permanent rules for energy choice that became effective on August 1. These rules require that local distribution companies provide marketers with names and addresses of eligible customers and their monthly energy consumption for the previous 12 months, if customers choose to have the information released. All bills must use standard terms and include a customer's monthly energy consumption for the past 12 months and a description of all applicable charges and rate changes. Marketers must be licensed by the SCC and demonstrate the financial and technical ability to deliver services to Virginia utility customers. The SCC has issued 27 licenses to competitive suppliers of electricity or natural gas.

Choice Status

• The state has partially implemented comprehensive unbundling programs for its residential customers.
• As of November 2002, 69,982 out of 344,294 residential customers (about 20%) were enrolled with competitive suppliers in Washington Gas territory. About 11,000 residential customers participated in a Columbia Gas pilot program; the company opened the program to all customers in August 2002.

Choice education
Virginia Energy Choice
www.yesvachoice.com/
1-877-YES2004
This state website features information about energy restructuring in Virginia - what is changing, what is staying the same, and how to choose an energy supplier. It lists both electric and natural gas suppliers in the state.

Energy Supply Competition
www.state.va.us/scc/division/restruct/main/tbarroll.htm
This state website provides links to all of the Virginia State Corporation Commission staff reports on energy restructuring and to all SCC press releases on energy issues in the state.

Suppliers
www.yesvachoice.com/suppliers/suppliers.asp

• Aggregators must obtain a license from the State Corporation Commission. An aggregator that is also an electricity supplier is also obligated to obtain a supplier’s license from the SCC.
• SCC licensing requirements may include providing background information; demonstrating financial responsibility; posting a bond to ensure financial responsibility; paying an annual license fee; and paying all applicable taxes and fees. In addition, the SCC may require demonstration of technical capability, and if the aggregator is also a supplier, proof of adequate access to generation and generation reserves.

Municipal and State Aggregation

• Counties, cities and towns and other political subdivisions may, upon authorization by majority votes of their governing bodies, aggregate electrical energy and demand requirements. Any municipality or other political subdivision may aggregate the electric energy load of residential, commercial and industrial retail customers within its boundaries on a voluntary, opt-in basis in which each customer must affirmatively select such municipality or other political subdivision as its aggregator. The municipality or other political subdivision may not earn a profit but must recover the actual costs incurred in such aggregation.
• Any municipality or other political subdivision may aggregate the electric energy load of its governmental buildings, facilities and any other governmental operations requiring the consumption of electric energy. Aggregators acting in this capacity are not required to obtain a license.
• Two or more municipalities or other political subdivisions may aggregate the electric energy load of their governmental buildings, facilities and any other governmental operations requiring the consumption of electric energy. Aggregators acting in this capacity are not required to obtain a license.
• The Commonwealth of Virginia may aggregate the electric energy load of its governmental buildings, facilities, and any other government operations requiring the consumption of electric energy for the purpose of negotiating the purchase of electricity from any licensed supplier. Aggregators acting in this capacity are not required to obtain a license.
  

State Restructuring Resources

Utility Regulatory Commission
State Corporation Commission
1-800-552-7945
www.state.va.us/scc/index.html

Consumer advocate
Office of Consumer Affairs
1-800-552.9963
www.vdacs.state.va.us/consumers/index.html

Grassroots groups
Virginia Citizen's Consumer Council
804-344-4321
www.virginiaconsumer.org/left.htm

Consumer Protection

• Terms and conditions concerning customer disconnection for non-payment of regulated service charges shall be set forth in each local distribution company's tariff approved by the State Corporation Commission. A customer may not be disconnected for non-payment of unregulated service charges.
• A disconnection notice for non-payment must appear on the first page of the customer bill and be emphasized in a manner that draws immediate attention to such notice. The notice must clearly identify the amount that must be paid and the date by which such amount must be paid to avoid disconnection.

• Customer service contracts shall include:

1. Price or, if the exact price cannot feasibly be specified, an explanation of how the price will be calculated;
2. Length of the service contract, including any provisions for automatic contract renewal;
3. Provisions for termination by the customer and by the competitive service provider;
4. A statement of any minimum contract terms, minimum or maximum usage requirements, minimum or fixed charges, any other charges, and any required deposit;
5. Applicable fees including, but not limited to, start-up fees, cancellation fees, late payment fees, and fees for checks returned for insufficient funds;
6. A notice of billing terms and conditions; and
7. A toll-free telephone number and an address for inquiries and complaints.

• If a competitive service provider collects security deposits or prepayments, such funds must be held in escrow by a third party in Virginia.
• A competitive service provider requiring a deposit or prepayment from a customer must limit the amount of the deposit or prepayment to the equivalent of a customer's estimated liability for no more than three months' usage of services.
• Customer deposits held or collected by a local distribution company must be for only those services provided by the local distribution company. Any deposit held in excess of this amount must be promptly credited or refunded to the customer.

• A clear and conspicuous caption, "CUSTOMER'S RIGHT TO CANCEL," must appear on the front side of the contract, or immediately above the customer's signature, in bold face type of a minimum size of ten points, along with a statement that a customer may cancel the contract, without penalty, with the competitive service provider by notifying the provider or the local distribution company prior to the close of business on the tenth day following notice of enrollment request by the local distribution company.

• A competitive service provider must offer separate billing service or consolidated billing service, or both, to prospective customers.
• A competitive service provider must coordinate the provision of the customer-selected billing service with the local distribution company.
• The local distribution company must apply a customer's partial payment of a consolidated bill as designated by the customer or, in the absence of a customer’s designation, to charges in the following order:

1. to regulated service arrearages owed the local distribution company;
2. to competitive energy service arrearages owed the competitive service provider;
3. to regulated service current charges of the local distribution company;
4. to competitive energy service current charges of the competitive service provider; and
5. to other charges.

• The local distribution company and a competitive service provider supply the following minimum billing information standards on all customer bills:

1. Sufficient information so that a customer can understand and calculate the billing charges
2. Clearly distinguished charges for regulated services and unregulated services
3. Standard terminology charges categorized for the following key bill components: distribution service; competitive transition charge; electricity supply service or natural gas supply service; state and local consumption tax; and local (or locality name) utility tax.
4. Non-routine charges and fees shall be itemized including late payment charges and deposit collections.
5. The total bill amount due and due date by which payment must be received to avoid late payment charges shall be clearly identified.
6. The 24-hour toll-free telephone number of the local distribution company for service emergencies

• The following additional information must be provided on customer bills:

1. Customer name, service address, billing address, account number, rate schedule identifier, and meter identification number.
2. Billing party name, payment address, and toll-free telephone number for customer inquiries and complaints.
3. For consolidated bills, non-billing party name and toll-free telephone number for customer inquiries and complaints.
4. Bill issue date and notice of change in rates.
5. Previous and current meter readings and dates of such meter readings or metering period days, current period energy consumption, meter reading unit conversion factor, billing-demand information, and "estimated" indicator for non-actual meter reads.

• To be licensed, a competitive service provider must demonstrate to the State Corporation Commission that it has the technical and financial capability of providing service to Virginia consumers, and demonstrate that it has access to electric supply. A license may cover the whole state or only the specific service territory of a local distribution company (LDC). A $250 registration fee payable to the State Corporation Commission.

• A competitive service provider may enroll or modify the services provided to a customer only after the customer has affirmatively authorized it.
• A competitive service provider must maintain adequate records allowing it to verify a customer's enrollment authorization.
• A competitive service provider must send a written contract to a customer prior to, or contemporaneously with, sending the enrollment request to the local distribution company.
• Upon a customer's request, a competitive service provider may re-enroll such customer at a new address under the existing contract, without acquiring new authorization records, if the competitive service provider is licensed to provide service to the customer's new address and is registered with the local distribution company.
• The local distribution company must advise a customer initiating new service of the customer's right and opportunity to choose a competitive service provider.

• A competitive service provider must establish an explicit dispute resolution procedure that clearly identifies the process for resolving customer disputes. A copy of such dispute resolution procedure must be provided to a customer or the State Corporation Commission upon request.
• A competitive service provider must give customers an address and 24-hour toll-free telephone number for customer inquiries and complaints regarding services provided by the competitive service provider. Outside of normal business hours, a recorded message must direct customers how to obtain customer assistance.
• When a customer complaint or inquiry has been referred to the local distribution company by a competitive service provider, or to a competitive service provider by the local distribution company, the appropriate company must resolve the inquiry or complaint in a timely fashion or contact the other party to determine responsibility for resolving the inquiry or complaint.
• If a competitive service provider and customer cannot resolve a dispute, the competitive service provider must provide the customer with the toll-free telephone number and address of the State Corporation Commission.
• Before implementing full or phased-in retail access, the local distribution company must establish and file with the State Corporation Commission an explicit dispute resolution procedure to address complaints, disputes, or alleged violations hat may arise between the local distribution company and a competitive service provider.

Discrimination/redlining

• The local distribution company must conduct its load profiling activities in a nondiscriminatory and reasonably transparent manner.
• The local distribution company must ensure that profile classes are easily identifiable, that load profiles used are representative of the customer class being profiled, and that customer loads are represented in a nondiscriminatory manner. Load profiles and load-profiling methodologies must be reviewable and verifiable by the State Corporation Commission.
• The local distribution company must provide a competitive service provider access to sample data, excluding any customer-specific identifier, that is necessary to verify the validity and reliability of load profiles and methodologies.

• An affiliated competitive service provider may use the name or logo of its affiliated local distribution company in advertising and solicitation materials. A disclaimer must be included when an affiliated competitive service provider offers services in the service territory of its affiliated local distribution company. The disclaimer must clearly and conspicuously disclose that the affiliated competitive service provider is not the same company as the local distribution company. Disclaimers are not required on company vehicles, clothing, or trinkets, writing instruments, or similar promotional materials.

• A competitive service provider must safeguard all customer information and cannot disclose such information unless the customer authorizes disclosure or unless the information is already in the public domain. This provision does not restrict the disclosure of credit and payment information permitted by federal and state statutes.
• The local distribution company must provide, upon the request of a competitive service provider, a mass list of eligible customers.
• A competitive service provider must safeguard all of the information included on the mass list and cannot disclose such information unless the customer authorizes disclosure or unless the information to be disclosed is already in the public domain. Before disclosing any information on the mass list, the local distribution company must give each customer the opportunity to have the information withheld, in total, from the mass list.
• A competitive service provider must obtain customer authorization prior before requesting any customer usage information not included on the mass list from the local distribution company.