S 8530: Enacts the utility transparency and fair billing protection act to prevent consumers from being overcharged due to misclassified utility rates by mandating proactive account reviews, automatic adjustments, and ensuring clear communication between utilities and customers.

  
  STATE OF NEW YORK ________________________________________________________________________ 8530 2025-2026 Regular Sessions  IN SENATE October 15, 2025 ___________ Introduced by Sen. MATTERA -- read twice and ordered printed, and when printed to be committed to the Committee on Rules AN ACT to amend the public service law, in relation to enacting the utility transparency and fair billing protection act The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "utility transparency and fair billing protection act". 3 § 2. Legislative findings and intent. The legislature finds that 4 misclassification of utility rates is a significant issue that affects 5 consumers, especially the elderly, low-income households, and those 6 undergoing major home upgrades. 7 The legislature further finds that utility companies have the ability 8 to proactively monitor and correct billing errors, but have failed to do 9 so in many cases, leading to unnecessary financial burdens on consumers. 10 It is the intent of the legislature to ensure that utility companies 11 should bear the responsibility for maintaining accurate billing systems 12 and making timely corrections when billing errors occur, rather than 13 placing the burden on consumers to monitor their own bills for potential 14 errors. 15 This proposed legislation aims to prevent consumers from being over- 16 charged due to misclassified utility rates by mandating proactive 17 account reviews, automatic adjustments, and ensuring clear communication 18 between utilities and customers. It also ensures that consumers can 19 easily access refunds for overcharges, regardless of whether they 20 actively reported the issue, and improves transparency and fairness in 21 utility billing practices. By enacting these protections, the law seeks 22 to hold utilities accountable while safeguarding the financial well-be- 23 ing of consumers. 24 § 3. The public service law is amended by adding a new article 3 to 25 read as follows: EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD13864-01-5 
 S. 8530 2 1 ARTICLE 3 2 UTILITY TRANSPARENCY AND FAIR BILLING PROTECTION 3 Section 60. Utility obligations to monitor billing classifications. 4 60-a. Consumer protections and refunds. 5 60-b. Utility reporting and oversight. 6 60-c. Consumer notification. 7 60-d. Enforcement and penalties. 8 60-e. Rules and regulations. 9 § 60. Utility obligations to monitor billing classifications. 1. 10 Proactive account review. (a) All utility companies shall implement a 11 proactive, automated review system that identifies discrepancies in rate 12 classifications, particularly for customers who have increased usage or 13 changed their service needs. 14 (b) Such system shall automatically flag accounts where usage spikes 15 suggest a possible misclassification, including but not limited to, a 16 shift from an appliance rate to a heating rate. 17 (c) Utilities shall send quarterly notifications to customers inform- 18 ing them of any discrepancies found and offering the option to review 19 their rate classification. 20 2. Automatic adjustment for misclassified accounts. (a) If an account 21 is found to be misclassified, the utility shall automatically adjust the 22 billing rate to the correct rate code within thirty days of such finding 23 and retroactively apply the correct rate for the past twelve months 24 without requiring customer action. 25 (b) Where an account has been found to be misclassified as described 26 in paragraph (a) of this subdivision, the utility shall notify the 27 customer of the adjustment and provide a clear explanation of how the 28 corrected rate affects their billing. 29 3. Timely and transparent billing. (a) Every utility company shall 30 ensure that all bills clearly indicate the rate code applied, the 31 specific tariff classification, and the reasons for any significant 32 changes in the rate. 33 (b) Every utility company shall give its customers access to an online 34 portal or easy-to-read summary to track their rate classification and 35 any history of rate changes. 36 § 60-a. Consumer protections and refunds. 1. Retroactive refunds. (a) 37 A customer who has been billed at an incorrect rate is entitled to 38 retroactive refunds for up to six years, even if they did not directly 39 notify the utility company about the change in their service. 40 (b) A utility company required to pay a refund pursuant to paragraph 41 (a) of this subdivision shall provide such refund as either a lump sum 42 payment or credit on future bills, depending on the customer's prefer- 43 ence. 44 2. No refund cap. No utility company shall limit a refund required to 45 be paid pursuant to this section to a set amount based on the perceived 46 financial burden of issuing refunds for misclassified accounts. 47 3. Transparency in refund policies. Every utility company shall clear- 48 ly disclose their refund and billing error policies to customers at the 49 time of sign-up and annually thereafter, including the process for 50 requesting a review of incorrect rate classifications. 51 4. Consumer awareness and education. (a) Every utility company shall 52 provide educational materials to customers at the time of account setup 53 and annually thereafter, explaining the importance of correct rate clas- 54 sifications and how to identify billing errors. 
 S. 8530 3 1 (b) Such educational material shall explain how customers can notify 2 the utility of service changes and what documentation is needed to 3 ensure the rate classification is updated correctly. 4 § 60-b. Utility reporting and oversight. 1. Annual rate review report. 5 (a) Every utility company shall submit an annual report to the depart- 6 ment detailing: 7 (i) the number of accounts reviewed for misclassified rates; 8 (ii) the number of rate adjustments made, including the amount of 9 refunds issued; and 10 (iii) the number of customer complaints and how they were resolved. 11 (b) The department shall publish the reports received pursuant to 12 paragraph (a) of this subdivision on its public website. 13 2. Regulatory oversight. (a) The department shall regularly review 14 utility compliance with the provisions of this article. The department 15 shall conduct random audits to ensure utility companies are properly 16 monitoring and correcting misclassified accounts. 17 (b) If a utility company is found to be in violation of the provisions 18 of this article, the department may impose financial penalties and/or 19 require corrective action, including but not limited to, compensating 20 customers for overcharges. 21 § 60-c. Consumer notification. 1. Notification requirements. (a) A 22 utility company shall send a written notice to the customer alerting 23 them to a potential misclassification and offering assistance in review- 24 ing the rate within thirty days when such customer's usage increases 25 substantially. 26 (b) If a rate adjustment is made due to a change in usage, the utility 27 company shall also send a written explanation detailing the new rate 28 classification and the impact on the customer's billing. 29 2. Special protections for vulnerable populations. Every utility 30 company shall provide the notifications required pursuant to subdivision 31 one of this section within fifteen days where the applicable customer is 32 a low-income household, senior citizen, military veteran or a customer 33 enrolled in an energy assistance program. Such notifications shall meet 34 all of the requirements of this subdivision and shall additionally 35 include a direct contact phone number for such customers to resolve 36 issues separate from the contact information provided to customers not 37 covered by the provisions of this subdivision. 38 § 60-d. Enforcement and penalties. 1. Penalties for non-compliance. 39 (a) If a utility company fails to comply with the proactive review or 40 refund requirements pursuant to sections sixty and sixty-a of this arti- 41 cle, the department may fine such utility company up to five hundred 42 thousand dollars per violation. 43 (b) Where a utility company has previously been found to be in 44 violation of sections sixty or sixty-a of this article pursuant to para- 45 graph (a) of this subdivision the department may take additional 46 actions, including temporary suspension of rate increases, increased 47 fines or other corrective actions as determined by the department. 48 2. Consumer redress mechanism. (a) Customers who believe they were 49 misclassified but cannot resolve the issue with the utility may file a 50 complaint with the department, which shall have sixty days to resolve 51 the issue on behalf of the customer. 52 (b) Where the department is unable to resolve an issue on behalf of a 53 utility company customer pursuant to paragraph (a) of this subdivision, 54 such customer may file an action against the utility company in any 55 court of competent jurisdiction for damages, including any overcharges 56 and legal fees. 
 S. 8530 4 1 § 60-e. Rules and regulations. The commissioner shall promulgate all 2 rules and regulations necessary for the implementation of this article. 3 § 4. This act shall take effect on the one hundred eightieth day after 4 it shall have become a law. Effective immediately, the addition, amend- 5 ment and/or repeal of any rule or regulation necessary for the implemen- 6 tation of this act on its effective date are authorized to be made and 7 completed on or before such effective date.