New Jersey Utility Customers Could Get Hit by Double Whammy

Talk about rate shock.

The state’s gas and electric utilities aim to recover nearly $1 billion in costs they incurred restoring power and service after extreme storms in the past few years, and the costs keep rising.

And that’s not all.

The cost to utility customers to harden the power grid dwarfs even that amount in filings by companies to the New Jersey Board of Utilities, with utilities seeking to spend in excess of $4 billion on projects to avert similar widespread outages as those that occurred during Sandy and other storms in recent years.

The agency is encouraging utilities to take steps to upgrade their electric and gas distribution systems in the wake of public outrage over losing power for two weeks or more during the superstorm. It poses a dilemma, however, for regulators: How much investment should be allowed at a time when many say utility bills already are too high in New Jersey?

Public Service Electric & Gas accounts for the bulk of those expenditures, seeking to invest $3.9 billion over the next 10 years, but other utilities also have sizable investment plans. New Jersey Natural Gas wants to spend $125 million upgrading its gas distribution system, while South Jersey Gas proposes to invest $280 million in its system, according to Jerome May, director of the Division of Energy at the BPU. Elizabethtown is seeking approval to spend $15 million on efforts to harden its system, May said.

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