Scroll Top

DeAngelo, Eustace, Mazzeo, Pintor Marin & Benson Consumer Protection Bill Requiring BPU to Establish Standards for Third-Party Energy Suppliers Now Law

(TRENTON) – Legislation sponsored by Assembly Democrats Wayne DeAngelo, Tim Eustace, Vince Mazzeo, Eliana Pintor Marin and Daniel Benson to require the Board of Public Utilities (BPU) to protect consumers by establishing standards and procedures for consumer interaction with third-party electric power and gas companies has been signed into law.

The law is a response to testimony the Assembly Telecommunications and Utilities Committee received from consumer utilities advocates and utilities partners on the need for regulation of third-party providers.

“The deregulated market leveled the playing field for third party competitors and gave consumers the opportunity to shop around for the best rate,” said DeAngelo (D-Mercer/Middlesex), chair of the Assembly Telecommunications and Utilities Committee. “However, it also has raised concerns for many regarding regulation. This law will begin to strengthen consumer protection for residents who choose a third party electric power or gas service as their energy provider.”

“Consumers are currently navigating an unregulated third party utilities market,” said Eustace (D-Bergen/Passaic). “There needs to be more transparency in the process. We want consumers to continue to make their own choices with clear rules and regulations in place to guard residents who enter into these contracts with suppliers.”

The law (A-3851) prohibits an electric power supplier or gas supplier (supplier) from providing electric generation service or gas supply service to a customer in this state unless the supplier has provided the customer a one-page information sheet summarizing the material terms and conditions of the contract as determined by the Board of Public Utilities. Under the law, a contract between a customer and the supplier must use a 12-point font and state in a 12-point font whether the contract is for a fixed rate or a variable rate. The measure also requires contracts to include an explanation of the difference between a fixed rate and variable rate that is easily understandable by the general public.

The law also requires suppliers to provide customers with a one-page information sheet summarizing the pertinent terms of the contract in English and Spanish. In addition, the law prohibits suppliers from providing the customer’s telephone number, e-mail address or mailing address to other suppliers if the customer’s telephone number appears on the federal or state do-not-call list.

“Consumers, especially seniors, should not have to worry about ending up with bills they cannot afford to pay because they were unaware they had a variable rate,” said Mazzeo (D-Atlantic). “This law will help protect New Jersey’s ratepayers from unreasonable rate increases by making it clear what they are buying into.”

“Numerous consumers in New Jersey have testified that they were unaware that they had variable rate contracts and that such contracts could result in them paying rates double or triple what they believed they had agreed to,” said Pintor Marin (D-Essex). “By providing ratepayers with clear outlines of their contracts in terms they can understand, this law will go a long way toward increased consumer protection.”

“Consumers who switch to third-party utility companies often are looking to save money, but unfortunately, they later realize that variable rates written into their contracts may end up costing them significantly more over the long run,” said Benson (D-Mercer/Middlesex). “This law will make it easier for customers to understand from the start how they will be charged for energy usage.”

The law applies to contracts formed or renewed after the law becomes effective.