What Does the PUC Do?
PUCs carry a broad regulatory mandate, but their core responsibilities can be grouped into five key areas:
1.) Rate Regulation: Public Utility Commissions review and approve the rates that investor-owned utilities charge customers for delivery service and the supply rates utilities set for their customers. These rates must be determined to be just and reasonable before they take effect, meaning utilities cannot simply raise charges without commission approval.
2.) Licensing: In deregulated energy markets, PUCs are responsible for licensing retail energy suppliers and, in many states, the brokers who sell energy on their behalf. Operating without the appropriate PUC license in a given state is a violation that can result in fines or loss of market access.
3.) Service Reliability Standards: PUCs require utilities to maintain the infrastructure necessary to deliver consistent and safe service to consumers. This includes the oversight of grid maintenance, outage response, and long-term capital investment oversight.
4.) Consumer Complaint Resolution: When a customer has a dispute with a utility or energy supplier, the PUC provides a formal channel to file a complaint and seek resolution. This is an important protection that exists regardless of whether a customer is in a regulated or deregulated market.
5.) Energy Policy: Lastly, PUCs are also responsible for enforcing state-level energy policy goals, including renewable portfolio standards, energy efficiency program requirements, and low-income protections.
Each PUC is governed by a panel of commissioners who operate in a judicial capacity. They hold public hearings, evaluate evidence, and issue binding rulings on utility-related matters, much like a specialized regulatory court.
PUCs in Regulated vs. Deregulated Markets
The PUC’s role looks different in deregulated energy states vs. regulated markets. Let’s dive into how regulatory oversight works based on the state’s market access status.
In regulated markets, the PUC controls the entire energy landscape. It sets the regulated rates customers pay for both the supply and delivery of electricity and natural gas, approves utility infrastructure investments, and oversees the utility as the sole provider. In regulated states, customers cannot choose an alternative supplier. The utility handles everything, and the PUC sets the price.
In deregulated energy markets, the supply and delivery components of energy are separated. Customers can choose their own retail energy supplier, and market competition determines supply pricing. However, the PUC remains actively involved. It oversees competitive market conduct, licenses retail suppliers and brokers, administers customer choice programs, and continues to regulate delivery charges. Furthermore, the PUC oversees the utility’s default supply rates that are offered in the case that a customer does not choose an alternative energy supplier.
Diversegy operates exclusively in deregulated energy markets, where understanding PUC oversight is foundational to responsible energy procurement strategies.
How the PUC Affects Energy Brokers
For energy brokers, PUC oversight shapes how, where, and under what conditions you can do business. Here’s how PUC regulation affects retail energy brokers.
Licensing Requirements
Broker licensing requirements vary considerably from state to state. Some PUCs require formal registration, competency checks, surety bonds, and background disclosures before a broker can legally operate in their market. Others require only a basic registration. For brokers expanding into multiple deregulated states, tracking and maintaining compliance across every jurisdiction is an ongoing responsibility. Letting a license lapse or operating without proper energy broker licensing requirements in a given state is a regulatory violation with real consequences.
Compliance Obligations
Beyond licensing, PUCs set the rules governing how brokers conduct business. This includes marketing practice standards, contract disclosure requirements, and customer consent protocols. Brokers who fail to meet these obligations, whether through misleading marketing, inadequate disclosures, or improper enrollment practices, face the risk of fines, license suspension, or formal complaints filed against them with the commission.
Complaint Exposure
When a commercial energy customer files a formal PUC complaint that involves a broker, the broker may be subject to a formal commission investigation and required to respond directly to the PUC. This is a meaningful risk for brokers who do not maintain rigorous compliance standards across their operations.
Diversegy is a fully licensed broker across all deregulated U.S. markets and treats PUC compliance as a baseline standard of operation. For brokers looking to expand their market reach through a broker platform like Diversegy, that foundation matters.
How the PUC Protects Commercial Energy Customers
Choosing your own energy supplier in a deregulated market comes with real benefits, but also some risk. PUC oversight continues to protect commercial energy customers in several meaningful ways.
Delivery Rate Oversight
When a business switches to a third-party energy supplier, the delivery side of the bill remains with the local utility. These distribution charges remain regulated by the PUC regardless of which supplier a customer chooses. That means that a core portion of every commercial energy bill is subject to regulatory oversight and cannot be manipulated by competitive market forces or supplier pricing decisions.
Complaint Filing Process
If a commercial customer has a dispute with a utility or energy supplier, such as an unexpected rate change, billing error, or a contract term that was misrepresented, the PUC provides a formal resolution pathway. Customers can file an informal or formal complaint directly with their state commission, which will investigate the matter and issue a ruling if warranted. This process exists as a meaningful check on supplier and utility conduct, and it is available to commercial customers in both regulated and deregulated states.
Energy Choice Programs
Many deregulated energy states operate on official PUC-sponsored platforms where commercial customers can compare supplier offers side by side in a standardized, transparent format. These programs are designed to help businesses make informed energy procurement decisions without relying solely on supplier-provided information. Examples include Power to Choose in Texas and PA Power Switch in Pennsylvania. While these sponsored sites are a good benchmark, they often do not include rate offers for higher-usage commercial customers.
Supplier Protections
PUCs enforce rules that prohibit a range of deceptive supplier practices, including misleading marketing, unauthorized enrollments, otherwise referred to as slamming, and inadequate disclosure of contract terms. These protections are particularly relevant for commercial customers who may be approached by aggressive or less reputable suppliers in competitive markets. Understanding what to look for in a legitimate energy offer and learning how to evaluate energy brokers and suppliers is the first line of defense when shopping for third party energy supply agreements.
PUC Energy Choice Programs by State
Many deregulated states operate official PUC-sponsored online shopping platforms where commercial and residential customers can compare retail energy supplier offers in a standardized, side-by-side format. These programs are designed to bring transparency to the supplier selection process and are maintained by the state commission. The chart below outlines the major choice programs currently available by state.
| State | Shopping Site | URL |
|---|---|---|
| Texas | Power to Choose | https://www.powertochoose.org/ |
| Ohio | Apples to Apples | https://www.energychoice.ohio.gov/ApplestoApples.aspx |
| Pennsylvania | PA Power Switch | https://www.papowerswitch.com/ |
| New York | Power to Choose | https://documents.dps.ny.gov/PTC/home |
| Illinois | Plugin Illinois | https://plugin.illinois.gov/ |
| New Jersey | NJ Power Switch | https://nj.gov/njpowerswitch/ |
| Maryland | MD Electric Choice | https://www.mdelectricchoice.com/ |
While these sites offer great guidance, they lack customized energy procurement options for commercial and industrial customers. Working with a licensed energy advisor ensures you are accessing the right procurement options for your specific market and usage profile.
Public Utilities Commission FAQs
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Navigating PUC requirements, supplier options, and deregulated market rules is complex and it should not fall entirely on your business. Diversegy is licensed in all deregulated U.S. markets and operates under full PUC compliance, giving our customers and broker partners a foundation they can trust. Contact our team of energy industry experts today to discuss your energy procurement goals.
