Electricity Supplier Licensing
Learn about licensing requirements for electricity suppliers.
Click on a state to read about detailed licensing requirements in that state.About Electricity Supplier Licensing
Firms that provide electricity supply services in a competitive energy state are generally required to hold a license before performing supply services. Electricity suppliers are typically regulated by state public utility commissions. The Federal Energy Regulatory Commission (FERC) regulates them federally. However, licensing only occurs at the state-level.
Suppliers that also act as electricity agents or aggregators will likely need a separate state-issued license to provide those services.
Initial Registration
Before starting the registration process, it is important to make sure that your business entity is in good standing. If you provide service outside of your home state, you need to be foreign qualified in each of the jurisdictions you plan to serve. Foreign qualification is not always a prerequisite to licensure, so you may be able to make licensing and foreign qualification filings concurrently.
Application requirements vary by state, but common requirements include:
- Business entity information
- Articles of incorporation/formation
- A list of officers and owners of the business
- Financial statements
- Submission of a surety bond
- Proof of relevant experience for principals of the business
- Disciplinary and criminal history for key personnel
- Customer service contact information
- Proposed service area and related information
- Marketing material information
- List of other states where licensed to operate
In addition to state utility commission requirements, suppliers are usually required to register with the electric utility that serves in the supplier’s proposed area of service. Depending on where a supplier wants to provide service, multiple utility company registrations may be needed.
Filing tax registrations with the department of revenue is another important step when starting up or expanding to a new state. Many states offer consolidated applications for tax registration. But in some states, applicants will file multiple applications, sometimes with multiple state agencies.
Maintaining Compliance
After licenses are issued by the public utility commission, there are ongoing requirements to maintain a license’s active status. Filing on time can save you from headaches down the road. Missing periodic filing deadlines can jeopardize your company’s authority to supply electricity in a jurisdiction.
In most states, electricity supplier licenses need to be renewed annually. But there are also states with biennial, triennial, and other renewal periods for licenses.
Along with license renewal filings, many states require electricity suppliers to file periodic reports related to distribution volumes, revenue, renewable energy usage, and bonding requirements. Reporting requirements vary in frequency but are usually filed on an annual or quarterly basis.
Keeping up with each state’s requirements, tracking renewals, and submitting the applications on time are critical to avoiding penalties. Dedicated compliance services and software can help you keep track of varying jurisdiction requirements and relevant updates to state laws.
Explore Licensing by State
Click on a link below to view licensing information in your state.
Aggregator - Agents acting as brokers on behalf of a group or groups of customers.
Broker - An agent acting as a middleman between energy suppliers and customers. Brokers can be affiliated with a single energy supplier or may have several supplier affiliations.
Competitive Energy States - States that allow consumers to choose the supplier of their energy source.
Energy Supplier - Narrowly defined, a supplier is a company that owns rights to a supply of energy or owns means of producing energy and then sells that energy to customers. The broad definition of energy supplier also includes aggregators, brokers, and marketers.
Franchise Agreement - A contract between municipal governments and utility companies that sets a franchise fee and conditions for the use of public rights of way.
Power Marketer - Act as intermediary between utilities and customers. Marketers do not own any assets related to power generation, they simply find price discrepancies between utility companies and offer savings to customers.
ACCES: American Coalition of Competitive Energy Suppliers
Consumer outreach organization that educates the public on energy choice.
FERC: Federal Energy Regulatory Commission
Independent agency charged with oversight of electric, oil, natural gas, and hydropower transmissions.
RESA: Retail Energy Supply Association
National association of energy suppliers that encourages competition in energy markets.
