(1) The regulated electric distribution utility shall serve as the default supplier in its distribution service territory when a small customer is without supply service because the customer has not selected a competitive supplier or due to contract termination by an electricity supplier, including termination for nonpayment. The regulated natural gas distribution utility shall serve as the default supplier in its distribution service territory when a small customer is without supply service because the customer has not selected a competitive supplier or due to contract termination by a natural gas supplier, including termination for nonpayment.

(2) A customer receiving default supply service must remain in that service until his account is cleared with the default supplier. Once a customer's past due account is cleared, the customer may select a competitive service option from an alternative supplier. A default supplier may disconnect service to a customer who has not paid for its distribution services or default electricity or natural gas supply services. The deposit and termination rules of the commission apply to a default supplier (see ARM 38.5.1101 through 38.5.1112 and ARM 38.5.1401 through 38.5.1418) .

(3) After a competitive bid solicitation, a regulated electric or natural gas distribution utility may contract with a third-party supplier to acquire the necessary electric or natural gas supply to allow the distribution provider to meet its default supplier obligations. The regulated electric or natural gas distribution utility is responsible for ensuring compliance with the commission's deposit and termination rules.