NY Energy Brokers and Consultants Have Until July 31 to Register

New York’s Public Service Commission recently extended the deadline to July 31 for energy brokers and consultants to register with the Department of Public Service.

Public Service Law § 66-t requires energy brokers and consultants to register with the Department of Public Service and disclose certain fees to customers. In particular, parties must now disclose all compensation paid to brokers and consultants, including commissions, bonuses, and non-financial compensation, such as prizes, tickets, etc.

Failure to adhere to the registration and other rules can lead to fines, loss of commissions, invalidation of customer contracts, and forfeiture of the ability to operate in New York.

The new rules establish a registration process for energy brokers and energy consultants that requires an annual registration package consisting of a registration form, a $500 registration fee, and a demonstration of financial accountability. In addition, the new rules require disclosure of compensation by brokers and establish enforcement procedures. More information on the rules and registration process is available on the Department of Public Service website.

Harris Beach Energy Partner Michelle Piasecki will join a panel of experts for a June 20 Enerex webinar, “Mastering New York’s Regulatory Changes-Comprehensive Legal, Financial and Data Security Insights,” and provide a comprehensive overview of the legal and regulatory aspects, financial requirements, and provide a thorough breakdown of the Data Security Agreement essentials. The panel will also deep-dive into the latest regulatory changes, and equip attendees with insights needed to confidently navigate the changes. Enerex is a data platform that brings together brokers, suppliers, utilities, energy managers, and their customers to streamline the energy procurement process.

Michelle joins a panel on the same topic June 26th at The Energy Professionals Association (TEPA) 2024 Northeast Conference in New York City.

Who is an Energy Broker or Consultant?

The rules define “energy brokers” as “a non-utility entity that performs energy management or procurement functions on behalf of customers, ECSOs (Energy Service Companies) or DER (Distributed Energy Resource) Suppliers, and (1) that assumes the contractual and legal responsibility for the sale of electric supply service, transmission or other services to end-use retail customers, but does not take title to any of the electricity sold, and does not make retail energy sales to customers or (2) that assumes the contractual and legal obligation to provide for the sale of natural gas supply service, transportation or other services to end-use retail customers, but does not take title to any of the natural gas sold, and does not make retail energy sales to customers.”

An “energy consultant” is defined as “any person, firm, association or corporation who acts as broker in soliciting, negotiating or advising any electric or natural gas contract, or acts as an agent in accepting any electric or natural gas contract on behalf of a DER Supplier.”

These definitions are intended to be construed broadly and apply to all segments of the energy market, including energy supply companies, CCAs (Community Choice Aggregators), third party marketers, and potentially CDG (Community Distributed Generation) providers and building owners. For example, if a building owner is involved in facilitating a contract for electric or natural gas supply on behalf of its tenants, that owner would need to register as an energy consultant and comply with ongoing rules related to fee disclosures. Building owners are also now prohibited from receiving rebates for entering into supply agreements for the units within its building.

If you are involved, or think you may be involved, in the procurement or facilitation of an electric or natural gas supply contract, we encourage you to contact us to discuss whether you, or your company, need to register and submit an application to the Department of Public Service.

Harris Beach’s Energy Industry Team continues to monitor this situation and related energy matters. Should you have a question about the new energy broker rules or other energy-related matters, please reach out to the Harris Beach attorney with whom you most frequently work.