1. (a) Purpose. The purpose of this section is to ensure that, as mandated by the Public Utility Regulatory Act (PURA) §39.106:

   1. (1) A basic, standard retail service package will be offered by a POLR at a fixed, non-discountable rate to any requesting customer in all of the Texas transmission and distribution utilities' (TDU's) service areas that are open to competition; and
   2. (2) All customers will be assured continuity of service if a retail electric provider (REP) terminates service in accordance with the termination provisions of Subchapter R of this chapter (relating to Customer Protection Rules for Retail Electric Service).

2. (b) Application.

   1. (1) This section applies to REPs that may be designated as POLRs in TDU service areas in Texas. This section does not apply when an electric cooperative or a municipally owned utility (MOU) exercises its right to designate a POLR within its certificated service area. However, this section is applicable when an electric cooperative delegates its authority to the commission in accordance with subsection (p) of this section to select a POLR within the electric cooperative's service area.
   2. (2) POLR service for a residential or small non-residential customer of a competitive REP whose electric service is terminated for non-payment under the provisions of §25.482 of this title (relating to Termination of Contract) shall be provided by the affiliated REP for that POLR area. In the case of the territory encompassed by Sharyland Utilities, LP, the affiliated REP shall be deemed to be First Choice Power, Inc., the entity providing default service in that area. The provisions of this section do not apply to any affiliated REP serving non-paying residential and small non-residential customers of competitive REPs except as otherwise specifically stated herein.
   3. (3) As of September 24, 2002, a non-paying residential or small non-residential customer of an affiliated REP shall not be transferred to the POLR selected under this section.
   4. (4) A large non-residential customer whose service is terminated for non-payment shall not be transferred to the POLR after September 24, 2002. Notwithstanding the foregoing, a non-paying large non-residential customer may be transferred to the POLR if that customer is receiving service under a contract entered into prior to September 24, 2002, the original term of which has not expired at the time transfer to POLR is requested, and if the contract makes no provision for waiver of the customer's right to be transferred to the POLR for non-payment.

3. (c) Definitions. The following words and terms when used in this section shall have the following meaning, unless the context indicates otherwise:

   1. (1) Basic firm service--Electric service that is not subject to interruption for economic reasons and that does not include value added options offered in the competitive market. Basic firm service excludes, among other competitively offered options, emergency or back-up service, and stand-by service. For purposes of this definition, the phrase "interruption for economic reasons" does not mean disconnection for non-payment.
   2. (2) Billing cycle--A period bounded by a start date and stop date that REPs and TDUs use to determine when a customer used a service.
   3. (3) Billing month--Generally a calendar accounting period (approximately 30 days) for recording revenue, which may or may not coincide with the period a customer's consumption is recorded through meter readings.
   4. (4) Large non-residential customer--A non-residential customer with a peak demand above one megawatt (MW).
   5. (5) Load ratio--The amount of load for a particular customer class served by a REP on a nationwide basis in comparison to the amount of load for that class in areas in Texas where customer choice is in effect. This determination is to be made by dividing the REP's nationwide total megawatt-hour sales to the customer class during the prior year by the total megawatt-hour sales to such class in areas in Texas where customer choice was in effect during any portion of the prior year.
   6. (6) Non-discountable rate--A rate that does not allow for any deviation from the price offered to all customers within a class, except as provided in §25.454 of this title (relating to Rate Reduction Program).
   7. (7) POLR area--The service area of a TDU in an area where customer choice is in effect, except that the POLR area for Central Power and Light Company shall be deemed to include the area served by Sharyland Utilities, L.P.
   8. (8) Provider of last resort (POLR)--A REP certified in Texas that has been designated by the commission to provide a basic, standard retail service package in accordance with this section to customers that are not being served by a REP for reasons other than non-payment.
   9. (9) Residential customer--A residential customer as defined in §25.41 of this title (relating to the Price to Beat).
   10. (10) Small non-residential customer--A small commercial customer as defined in §25.41 of this title.

4. (d) POLR service.

   1. (1) For the purpose of POLR service, there will be three classes of customers: residential, small non-residential, and large non-residential.

   2. (2) The POLR may be designated to serve any or all of the three customer classes in a POLR area. Within the customer class it is designated to serve, the POLR shall provide service to the following customers:

      1. (A) Any customer requesting POLR service; and
      2. (B) Any customer not receiving service from its selected REP for any reason other than non-payment who is automatically assigned to the POLR.

   3. (3) The POLR shall offer a basic, standard retail service package, which will be limited to:

      1. (A) Basic firm service;
      2. (B) Call center facilities for customer inquiries;
      3. (C) Standard retail billing (which may be provided either by the POLR or another entity);
      4. (D) Benefits for low-income customers as provided for under PURA §39.903 relating to the System Benefit Fund; and
      5. (E) Standard metering, consistent with PURA §39.107(a) and (b) (which may be provided either by the POLR or another entity).
   4. (4) The POLR shall, in accordance with §25.108 of this title (relating to Financial Standards for Retail Electric Providers Regarding the Billing and Collection of Transition Charges), provide billing and collection duties for REPs who have defaulted on payments to the servicer of transition bonds or to TDUs.

5. (e) Standards of service.

   1. (1) A REP who has been designated by the commission to serve as POLR for a class in a given area shall serve any customer in that class as described in subsection (d)(2) of this section.

   2. (2) A POLR shall abide by the applicable customer protection rules as provided for under Subchapter R of this chapter. In addition, the POLR shall be held to the following general standards:

      1. (A) The POLR shall inform any customer transferred to it that it is now providing service to the customer and disclose all charges for which the customer will be responsible;
      2. (B) The POLR shall provide a commission-maintained list of certified REPs to any customer who inquires about selecting a provider;
      3. (C) The POLR may not require that a customer sign up for a minimum term as a condition of service, except that if the POLR offers a level or average payment plan in accordance with Subchapter R of this chapter, a residential or small non-residential customer who elects to receive service under such plan may be required to sign up for a minimum term of no more than six months.

6. (f) Customer information.

   1. (1) Forms. The forms in subparagraph (A)-(C) of this paragraph are effective for all POLR service rendered after December 31, 2002. These forms may only be changed through the rulemaking process and are available in the commission's Central Records Division and on the commission's website at www.puc.state.tx.us.

      1. (A) Terms of Service Agreement, Provider of Last Resort (POLR) Residential Service:
         Attached Graphic
         
      2. (B) Terms of Service Agreement, Provider of Last Resort (POLR) Small Non-Residential Service:
         Attached Graphic
         
      3. (C) Terms of Service Agreement, Provider of Last Resort (POLR) Large Non-Residential Service:
         Attached Graphic
         
   2. (2) Provision of information to customers. The POLR shall provide each new customer the terms of service agreement applicable to the specific customer. Such terms of service agreements shall be updated as required under §25.475(d) of this title (relating to Information Disclosures to Residential and Small Commercial Customers.)

7. (g) General description of POLR selection process.

   1. (1) POLR selected for areas where customer choice is in effect. The commission shall designate certified REPs to serve as POLRs in areas of the State in which customer choice is in effect, except that the commission shall not designate the POLR in the service areas of MOUs or electric cooperatives unless an electric cooperative has delegated its POLR designation authority to the commission in accordance with subsection (p) of this section.
   2. (2) Process. The commission will solicit bids for POLR service for two-year terms as specified in paragraph (3) of this subsection. Bids shall be solicited from REPs that are eligible to provide POLR service under the provisions of subsection (h) of this section. The process for evaluating such bids is specified in subsection (i) of this section and the basis upon which bids shall be compared is specified in subsection (k)(3) of this section. If no eligible bids for a POLR customer class in a POLR area are submitted, the POLR shall be selected by lottery under the procedures set forth in subsection (j) of this section and the POLR rate established under the provisions of subsection (k) of this section.
   3. (3) Term. POLRs shall serve two-year terms beginning in January of each odd-numbered year. The initial term for POLR service in areas of the state where retail choice is not in effect as of the effective date of the rule shall be set at the time POLRs are initially selected in such areas.

8. (h) REP eligibility to serve as POLR. In each even-numbered year, the commission shall determine the eligibility of certified REPs to serve as POLR for the terms scheduled to commence in January of the next year.

   1. (1) Information requirements. The commission may require a REP and its affiliates to provide information to the commission necessary to establish that REP's eligibility to serve as POLR. Specific information received from a REP that is responsive to such a request by the commission shall be treated confidentially if it is submitted to the commission in accordance with the provisions of §22.71(d) of this title (relating to Filing of Pleadings, Documents and Other Materials). However, the commission's determination regarding eligibility of a REP to serve as POLR under the provisions of this section shall not be considered confidential information.

   2. (2) Criteria. During the term of the price to beat for a particular customer class, an affiliated REP is ineligible to serve as POLR for that class in the POLR area defined by the boundaries of its affiliated TDU, unless the affiliated REP submits a bid to provide POLR service in the POLR area defined by the boundaries of its affiliated TDU at the price to beat. A REP is also ineligible to provide POLR service to a particular customer class in a POLR area if:

      1. (A) A proceeding to revoke or suspend the REP's certificate is pending at the commission or that REP's certificate has been suspended or revoked by the commission;
      2. (B) The REP's load ratio for the particular class is less than 1.0%;
      3. (C) The commission does not reasonably expect the REP to be able to meet the criteria set forth in subparagraph (B) of this paragraph during the entirety of the POLR term;
      4. (D) On the expected date of bid submittal, the REP or its predecessor, including a REP that has assumed the responsibilities of another REP, will not have served customers in Texas for at least 18 months;
      5. (E) The REP does not serve the applicable customer class in Texas;
      6. (F) The REP's customers are limited to its own affiliates; or
      7. (G) The REP is certified only to provide POLR service for an affiliate.
   3. (3) Publication of notice of eligibility. For each POLR term scheduled to commence in January of the next year, except for the year 2003, the commission shall publish the names of all of the REPs eligible to provide POLR service for each customer class in each POLR area. The notice shall be published in the Texas Register prior to or contemporaneously with publication of the invitation for bids. For 2003, only affiliated REPs shall be considered eligible REPs.

9. (i) Bid process. Initially, a competitive bid process will be used to select the POLR for each customer class in each designated POLR area.

   1. (1) Invitation to bid. Before the expiration of a term of POLR service in a POLR area, the commission shall issue an invitation for bids for POLR service for each customer class in the POLR area. Notice of the bid invitation, any submission requirements, the submission deadline, and the project number assigned to the bid process for that POLR area shall be published in the Texas Register. A separate project number shall be designated for each POLR area.
   2. (2) Bidder qualifications. A REP that has met the eligibility requirements of subsection (h) of this section shall be considered a qualified bidder.

   3. (3) Submission of bids.

      1. (A) Separate bids required. A bidder may submit a bid to serve any of the three customer classes in a POLR area. Bids for each customer class in a POLR area shall be submitted separately. A REP may submit a separate bid for POLR service for each customer class and POLR area for which it seeks to provide service.
      2. (B) Filing and content. Each bid shall be filed in the appropriate project number on or before the date and time specified in the bid invitation; identify only one POLR area; specify only one customer class; include a bid in conformance with the rate structure for the class; and not contain any information that will be considered, after the closing date for submission of all bids, to be confidential or proprietary by the filing party.
      3. (C) Designation of preference. A REP whose load ratio for a particular class is less than 5.0% that submits more than one bid for POLR service for that class may include in its bid a statement indicating its order of preference in POLR areas.
   4. (4) Filing under seal. Prior to the closing date specified in the bid invitation, bids must be filed under seal for the limited purpose of ensuring the confidentiality of the bids submitted.

   5. (5) Bid opening and public comment.

      1. (A) All bids filed under seal shall be opened and filed publicly by commission staff in the applicable project number by 5:00 p.m. on the third business day following the submission date identified in the bid invitation.
      2. (B) If the bid opening is cancelled, the bids filed under seal will be returned unopened to the bidders.
      3. (C) Interested persons may submit comments on bids in the applicable project up to the 10th calendar day after the bid submission deadline specified in the bid invitation. Interested persons may submit reply comments on bids up to the 15th calendar day after the submission deadline specified in the invitation. All comments and reply comments shall be filed in the applicable project.

   6. (6) Evaluation of bids.

      1. (A) Bids that have been rejected pursuant to subparagraph (B) of this paragraph shall not be evaluated. The bids received for each customer class in each POLR area shall be evaluated on the basis of price in accordance with the provisions of subsection (k)(3) of this section. If two or more bidders bid the same lowest price, the lowest bidder shall be determined by lottery in accordance with the provisions of subsection (j) of this section, with the pool of lottery candidates limited to the bidders submitting tie bids. If, with respect to a particular class of customers, a bidder described in paragraph (3)(C) of this subsection submits the lowest bid for that class of customers in two or more POLR areas, staff shall determine that the bidder submitted the lowest price in the POLR area according to the preference statement submitted by the bidder with its bids. If the bidder did not state a preference or the preferences stated are irreconcilable, the bidder shall be deemed to prefer to serve in the POLR area to which the lowest project number has been assigned.

      2. (B) The commission shall reject a bid for any of the following reasons:

         1. (i) The bidder is not qualified.
         2. (ii) The bid was received by the commission after the date and time specified in the bid invitation.
         3. (iii) The bid did not conform to a requirement described in the bid invitation.
         4. (iv) The rate structure submitted in the bid deviated from the rate structure applicable to the customer class or the bid price exceeds the maximum level specified in subsection (k)(3) of this section.
         5. (v) The bidder asserts to the commission that the bid contains information considered, after the closing date for submission of all bids, to be confidential or proprietary.
         6. (vi) In the event a bidder described in paragraph (3)(C) of this subsection submits two or more bids for the same customer class in different POLR areas then all bids from that bidder for that customer class, other than the preferred bid, shall be rejected.
   7. (7) Report to the commission. Staff shall report on the bid process for each POLR area to the commission. The report shall identify the POLR customer classes and POLR areas for which no bids were submitted. The report shall also identify all rejected bids and state the reason why each bid was rejected, describe conforming bids, and summarize the comments and reply comments received. For each customer class in each POLR area, the report shall include a recommendation by staff that POLR service be awarded to the bidder that offered the lowest price in a conforming bid or that the POLR for a given customer class and POLR area should be selected by lottery because no eligible bids were received.
   8. (8) Commission action. For a particular POLR class and POLR area, the commission shall either award a bid consistent with the provisions of this section or reject all bids and direct that the POLR for that customer class and POLR area be determined by lottery.

10. (j) Lottery. The provisions of this subsection shall govern the manner in which a lottery to select a POLR for a given POLR area and customer class is conducted.

    1. (1) Lottery candidacy. The commission shall designate a pool of lottery candidates for each customer class in each POLR service area. Every REP eligible to serve as a POLR is a candidate for the lottery unless:

       1. (A) By virtue of having successfully bid for POLR service, the REP will be serving as POLR for that customer class in two or more service areas in January of the next year; or
       2. (B) The REP's load ratio for the customer class is less than 5.0% and the REP will be serving as POLR for the customer class in another area during the upcoming POLR term.
    2. (2) Elimination from lottery pool. A REP otherwise eligible for the lottery pool that will be serving a particular customer class as POLR during the upcoming term in the POLR area defined by the boundaries of CenterPoint Energy Houston Electric shall be eliminated from the lottery pool for that class for the POLR area defined by the boundaries of the Oncor Electric Delivery Company. Similarly, a REP otherwise eligible for the lottery pool that will be serving a particular customer class as POLR during the upcoming term in the POLR area defined by the boundaries of the Oncor Electric Delivery Company shall be eliminated from the lottery pool for that class for the POLR area defined by the boundaries of CenterPoint Energy Houston Electric.
    3. (3) Drawing. At a time and date noticed by the commission in the Texas Register, a separate drawing will be held for each customer class in each POLR area for which a POLR was not selected by bid. The drawings shall be held in the order of the project numbers assigned to the POLR service areas and interested persons may attend. The names of the lottery candidates shall be written on separate pieces of paper of identical size and color. A staff member shall place the names of the lottery candidates in a receptacle. A commission representative shall draw a piece of paper from the receptacle. The REP whose name is written on the piece of paper shall serve as the POLR for that customer class in that POLR area at the rate specified in subsection (k)(4) of this section.

11. (k) POLR rate.

    1. (1) Components of POLR rate when service awarded by bid. The provisions of this paragraph apply to the POLR rate when POLR service is awarded by bid. The POLR rate for the residential and small non-residential customer classes shall be either the price to beat or a rate consisting of non-bypassable charges, a monthly customer charge that does not change during the term of the POLR, an energy charge, and, for small and large non-residential customers, a demand charge. For residential and small non-residential customers, the applicable standard price to beat rate shall be a floor on the POLR rate and the POLR rate may not fall below the PTB. For large non-residential customers, the POLR rate for large non-residential customers shall consist of non-bypassable charges, a monthly customer charge that does not change during the term of the POLR, an energy charge, and a demand charge.

    2. (2) Elements of a bid.

       1. (A) Residential customer class. Each bid for POLR service for the residential customer class shall be either a bid to serve customers at the price to beat or a bid that includes:

          1. (i) A monthly customer charge that shall not change during the POLR term and that customer charge may be zero dollars; and
          2. (ii) An energy charge subject to adjustment under the provisions of subsection (l) of this section, expressed as cents per kilowatt-hour (kWh). The energy charge may be differentiated into peak months (May through October) and off-peak months (November through April).
       2. (B) Small non-residential customer class. Each bid for POLR service for the small non-residential class shall be either a bid to serve customers at the price to beat or shall include the components for bids for the residential customer class as set forth in subparagraph (A) of this paragraph and a demand charge that may be zero dollars.

       3. (C) Large non-residential customer class. Each bid for POLR service for the large non-residential customer class shall include:

          1. (i) A monthly customer charge that shall not change during the POLR term and that customer charge may be zero dollars;
          2. (ii) A demand charge that may be zero dollars; and
          3. (iii) The percent over the energy reference price specified by the commission that the bidder will charge for energy. For POLR areas in the Electric Reliability Council of Texas (ERCOT), the energy reference price shall be the market clearing price for energy (MCPE) determined on the basis of 15-minute intervals. For POLR areas outside of ERCOT, the commission shall specify the energy reference price prior to the inception of retail customer choice.

    3. (3) Comparison and rejection of bids. Bids for POLR service for residential and small non-residential service shall be compared on the basis of price as specified in this paragraph.

       1. (A) Residential customer class. Bids for POLR service for residential customers shall be compared assuming monthly residential energy usage of 1000 kWh. If a bid for POLR service for this average usage level exceeds 125% of the applicable standard residential price to beat rate for that usage level at the time bids are submitted, the bid shall be rejected. For purposes of this rule, the standard residential price to beat rate for residential service in each POLR area shall refer to the following price to beat tariffs, as amended or replaced:
          Attached Graphic
          
       2. (B) Small non-residential class. Bids for POLR service for small non-residential customers shall be compared assuming a demand level of 35 kW and a monthly usage level of 12,500kWh. If the POLR rates bid for these average usage levels exceed 125% of the applicable standard commercial price to beat rate for both usage levels at the time bids are submitted, the bid shall be rejected. For purposes of this rule, standard commercial price to beat rate shall refer to the following price to beat tariffs, as amended or replaced:
          Attached Graphic
          
       3. (C) Large non-residential class. Bids for POLR service for large non-residential customers shall be compared assuming a monthly demand of 2.5 MW and a monthly usage level of 1,000,000 kWh.

    4. (4) POLR rates where POLR selected by lottery. This paragraph specifies the POLR rates that will be charged in a POLR area when the POLR is selected by lottery.

       1. (A) Residential and small non-residential customer classes. The rate charged by a POLR selected by lottery shall be 125% of the applicable standard price to beat rate.
       2. (B) Large non-residential class. The rate charged by a POLR selected by lottery shall be non-bypassable charges plus 150% of the applicable energy reference price as determined under paragraph (2)(C)(iii) of this subsection and a monthly customer charge of $2897. The minimum energy reference price shall be $7.25 per megawatt hour.
    5. (5) Good cause adjustment to POLR rates. On a showing of good cause, the commission may permit the POLR to adjust the POLR rate, if necessary to ensure that the rate is sufficient to allow the POLR to recover its costs of providing service. Notwithstanding any other commission rule to the contrary, POLR rates may be adjusted on an interim basis for good cause shown and after at least three days' notice and an opportunity for hearing on the request for interim relief. Alternatively, the commission may rebid POLR service and relieve the current POLR of its POLR responsibilities. If POLR service is rebid, the process specified in subsection (i) of this section shall be followed except that eligible REPs shall be those REPs identified in the last list that was published, with the POLR that is being relieved of its duties deleted from the list. If the commission elects to rebid POLR service and the bid process is unsuccessful, the commission may reconsider adjusting the POLR rates or select an alternate POLR provider by lottery in accordance with the provisions of subsection (j) of this section.

12. (l) Adjustment to energy charge component of residential and small non-residential POLR rates. The energy charge component of the POLR rate for the residential and small non-residential customer classes shall be adjusted as specified in this subsection if POLR service was awarded by bid.

    1. (1) Energy charge component reevaluated monthly. The energy charge component of the POLR rate for the residential and small non-residential customer classes shall be recalculated at the end of every month during the POLR term in accordance with the provisions of paragraph (2) of this subsection. If the recalculated energy charge varies by more than 5.0% from the time the energy charge was bid or last adjusted, then the energy charge of the POLR rate for the following month shall be equal to the recalculated energy charge. If the recalculated energy charge does not vary by more than 5.0% from the time the energy charge was bid or last adjusted, then the energy charge component shall not be adjusted for the following month. All adjustments shall take place during the first billing cycle of the billing month following the recalculation. Adjustments shall not occur during the customer's billing month. The POLR shall submit its monthly rate to the commission at least 15 days prior to the beginning of the applicable month.
    2. (2) Energy charge calculation.
       Attached Graphic
       
    3. (3) Refunds. If in response to a complaint or upon its own investigation, the commission determines that a POLR failed to properly adjust the energy charge component of the POLR rate and as a result overcharged its customers, the commission shall require the POLR to issue refunds to the specific customers who were overcharged.
13. (m) Marketing to POLR customers. An employee answering the POLR phone line will read from a script to describe POLR service but may market the services of its affiliates or any other REP that has entered into a marketing agreement with the POLR. The POLR shall not discriminate between unaffiliated REPs in the terms and conditions of any such marketing agreement. The POLR shall provide to REPs and aggregators on at least a quarterly basis an updated mass customer list of customers served by the POLR containing information similar to the information that the registration agent is authorized to release under §25.472 of this title (relating to Privacy of Customer Information). The POLR shall not be required to comply with the provisions of §25.472(a)(2) of this title prior to releasing its list of customers

14. (n) Transition of customers to POLR service.

    1. (1) POLR service for a requesting customer is initiated when the customer makes arrangements for service.
    2. (2) A customer other than a residential customer or small commercial customer (as defined in §25.471(d) of this title (relating to General Provisions of Customer Protection Rules) may agree to a contract or terms of service that allow a REP to transfer the customer to POLR for reasons other than non-payment, including the failure of the customer and its REP to agree on terms of renewal or extension. Unless ERCOT has a transaction that allows REPs to transfer such customers to the POLR, the POLR shall accept written requests for such transfers from REPs and shall initiate a switch for the customer to be transferred to the POLR. The acquisition by the POLR of such customers is not a prohibited enrollment under §25.474 of this title (relating to the Selection or Change of Retail Electric Provider). Further, §25.472(d) of this title (relating to Privacy of Customer Information) does not apply to such permitted customer transfers.
    3. (3) If the REP terminates service to a customer whose consumption is determined by monthly meter readings without giving notice, the POLR shall prorate the customer's usage based on the customer's historic data or load profile to establish the customer's charges for the relevant portion of the billing cycle, unless the customer requests and is willing to pay for an out-of-cycle meter read. Nothing in this section precludes a POLR from having an out-of-cycle meter read performed for a new customer on its own initiative provided the POLR does not pass on the cost of that meter read to the customer.
    4. (4) The POLR is responsible for obtaining resources and services needed to serve a customer once it has been notified that it is serving that customer. The customer is responsible for charges for POLR service at the POLR rate in effect at that time.
    5. (5) If a REP terminates service to a customer, it is financially responsible for the resources and services used to serve the customer until it notifies the independent organization of the termination of the service and until the switchover to the POLR is complete.
    6. (6) The POLR is financially responsible for all costs of providing electricity to customers from the time the switchover or initiation of service is complete until such time as the customer leaves POLR service.

15. (o) Termination of POLR status.

    1. (1) The commission may revoke a REP's POLR status after notice and opportunity for hearing:

       1. (A) If the POLR fails to maintain REP certification;
       2. (B) If the POLR fails to provide service in a manner consistent with this section; or
       3. (C) For good cause, provided the commission affords the POLR due process.
    2. (2) If a POLR defaults or has its status revoked before the end of its term, the commission may appoint any certified REP, other than a REP serving only its own affiliates, serving a customer class in that area to become the POLR until a new POLR is selected pursuant to the provisions of this rule. The rate for such POLR service shall be the rate established pursuant to subsection (k)(4) of this section.

    3. (3) The provisions of this paragraph address the transition to a new POLR at the end of a POLR term.

       1. (A) At the end of the POLR term the outgoing POLR may chose either to continue to serve POLR customers who do not select another provider through a competitive affiliate at a rate specified by the competitive affiliate or to terminate the customers who do not select another provider to the incoming POLR on the first meter read date after the term of the incoming POLR commences.
       2. (B) A notice containing the information specified in either subparagraph (C) or (D) of this paragraph, as applicable, shall be provided to each POLR customer at least 60 days prior to the end of the POLR term. The notice shall be in type no smaller than 12 points in size. The notice shall satisfy the requirements of §25.474(m) of this title in the event that the customer fails to switch to another provider and is transferred by the POLR to a competitive affiliate of the outgoing POLR or the customer fails to switch to another provider and is transferred to the incoming POLR by the outgoing POLR. The notice shall also include a phone number for the outgoing POLR for the customer to call to obtain more information.
       3. (C) The notice provided by a POLR that elects to transfer customers who fail to switch to another provider to a competitive affiliate shall include a comparison of the POLR rates currently charged to the customer to the rate offered by the competitive affiliate of the outgoing POLR as well as the applicable price to beat rate. The notice shall specify the deposit requirements of the competitive affiliate of the outgoing POLR and shall state that other providers may also require a deposit and may require payment of any amounts owed the provider for services previously rendered. The notice shall state where the customer may find additional information about offerings of other providers and shall inform the customer that, if the customer does not select another provider or request service from the incoming POLR by a specified date, that a competitive affiliate of the outgoing POLR will continue to serve the customer at the rate specified in the notice.
       4. (D) If the POLR elects to transfer customers who do not select another provider to the incoming POLR on the first meter read date after the term of the incoming POLR commences, the notice to customers shall state where the customer can find more information about other offerings as well as the rates of the incoming POLR. The notice shall inform the customer that if the customer does not select another provider by a specified date, the customer will be transferred to the incoming POLR on the first meter read date after the commencement of the POLR term. The notice shall also inform the customer that the incoming POLR will bill the customer for a deposit and that the deposit can be made in two installments as will be described further in the notice from the incoming POLR.
       5. (E) If a POLR customer either requests service from the incoming POLR or is terminated to the incoming POLR by the outgoing POLR, the outgoing POLR shall offset the customer's final bill against the customer's deposit and refund any remaining balance to the customer within 20 days from the customer's final meter read date. The customer shall be entitled to pay the deposit required by the incoming POLR in two installments in the manner provided in §25.478(f)(4) of this title (relating to Credit Requirements and Deposits).

16. (p) Electric cooperative delegation of authority. An electric cooperative that has adopted customer choice may propose to delegate to the commission its authority to select a POLR under PURA §41.053(c) in its certificated service area in accordance with this section. After notice and opportunity for comment, the commission will, at its option, accept or reject such delegation of authority. If the commission accepts the delegation of authority, the following conditions will apply:

    1. (1) The board of directors will provide the commission with a copy of a board resolution authorizing such delegation of authority;
    2. (2) The delegation of authority will be made at least 30 days prior to the time the commission issues an invitation for bids to establish a POLR for a contiguous or surrounding POLR area;
    3. (3) The delegation of authority will be for a minimum period corresponding to the period for which the solicitation will be made;
    4. (4) The electric cooperative wishing to delegate its authority to designate a POLR will also provide the commission with the authority to apply the selection criteria and procedures described in this section in selecting the POLR within the electric cooperative's certificated service area; and
    5. (5) If the competitive bidding process that includes the electric cooperative certificated area fails, the commission will automatically reject the delegation of authority.

17. (q) Reporting requirements. Each POLR and affiliated REP serving nonpaying customers of competitive REPs shall file the following information with the commission on a quarterly basis beginning January of each year in a project established by the commission for the receipt of such information. Each quarterly report shall be filed within 30 days of the end of the quarter. Except as provided in paragraph (5) of this subsection, information filed by an affiliated REP in accordance with paragraph (1) of this subsection will be made publicly available by the commission on an aggregated basis. Except as provided in subsection (5) of this section, information filed by a POLR in accordance with paragraphs (2)-(4) of this subsection will be made publicly available by the commission for each POLR area.

    1. (1) For each month of the reporting quarter, the affiliated REP shall report:

       1. (A) The number of residential customers who were disconnected for non-payment and the number of those customers that were eligible for the rate reduction program under §25.454 of this title;
       2. (B) The number of residential customers who were transferred to the affiliated REP by a competitive REP for non-payment and the number of those customers that were eligible for the rate reduction program under §25.454 of this title;
       3. (C) The average amount owed to the affiliated REP by residential customers at the time of disconnection;
       4. (D) The average amount owed to the affiliated REP by residential customers eligible for the rate reduction program at the time of disconnection;
       5. (E) The number of small non-residential customers who were disconnected for non-payment;
       6. (F) The average amount owed to the affiliated REP by small non-residential customers at the time of disconnection.

    2. (2) For each month of the reporting quarter, each POLR shall report the total number of new customers acquired by the POLR and the following information regarding these customers:

       1. (A) The number of customers eligible for the rate reduction program pursuant to §25.454 of this title;
       2. (B) The number of customers from whom a deposit was requested pursuant to the provisions of §25.478 of this title and the average amount of deposit requested;
       3. (C) The number of customers from whom a deposit was received, including those who entered into deferred payment plans for the deposit, and the average amount of the deposit;
       4. (D) The number of customers whose service was physically disconnected pursuant to the provisions of §25.483 of this title (relating to Disconnection of Service) for failure to pay a required deposit; and
       5. (E) Any explanatory data or narrative necessary to account for customers that were not included in either subparagraph (C) or (D) of this paragraph.

    3. (3) For each month of the reporting quarter each POLR shall report the total number of customers to whom a disconnection notice was issued pursuant to the provisions of §25.483 of this title and the following information regarding those customers:

       1. (A) The number of customers eligible for the rate reduction program pursuant to §25.454 of this title;
       2. (B) The number of customers who entered into a deferred payment plan, as defined by §25.480(j) of this title (relating to Bill Payment and Adjustments) with the POLR;
       3. (C) The number of customers whose service was physically disconnected pursuant to §25.483 of this title (relating to Disconnection of Service);
       4. (D) The average amount owed to the POLR by each disconnected customer at the time of disconnection; and
       5. (E) Any explanatory data or narrative necessary to account for customers that are not included in either subparagraph (B) or (C) of this paragraph.
    4. (4) For the entirety of the reporting quarter, each POLR shall report the average number of calendar days a customer received POLR service.
    5. (5) Reports filed under this subsection are subject to release as public information unless the reports or specific parts of the reports can be shown to be exempt from disclosure under Chapter 552 of the Texas Government Code, commonly known as the Texas Public Information Act (TPIA). If a reporting entity contends that all or part of a report is confidential, then the reporting entity shall file the information in accordance with the requirements of §22.71(d) of this title (relating to Filing of Pleadings, Documents and Other Materials). The reporting entity must submit in writing specific detailed reasons, including relevant legal authority, in support of its contentions that the material is exempt from disclosure under the TPIA. All reports and parts of reports that are not marked as confidential will be automatically considered public information upon submittal. The validity of any claim of confidentiality may be determined by the commission through a contested case proceeding, by the Office of the Attorney General pursuant to the provisions of the TPIA, or both.
18. (r) Waiver of customer protection rules. The provisions of §25.475(d) of this title requiring issuance of a revised terms of service statement to customers 45 days prior to any material change in the customer's terms of service shall not apply with respect to the implementation of the provisions of subsection (b)(3) of this section or §25.483(b) of this title.

Source Note:The provisions of this §25.43 adopted to be effective September 12, 2002, 27 TexReg 8428.