PSE&G has filed a request with New Jersey’s Board of Public Utilities (BPU) to raise $3.9 billion to update its power and gas energy grids. Termed the “Energy Strong” program, the increased revenue will go towards infrastructure upgrades that will prevent widespread power outages such as those experienced in Superstorm Sandy and other major storms over the past two years.
According to the BPU, this will raise PSE&G customers’ rates by about 8%, if the plan is approved. Bob Hanna, President of the BPU, argued during a public hearing that PSE&G could raise a significant amount of funds to improve the energy grids while keeping electric and gas rates mostly flat.
PSE&G filed the request earlier this year, but the BPU halted the proposal due to lack of details. Now, PSE&G says that the modernization program would not significantly increase customers’ bills due to historically low natural gas prices as well as the expiration of customer surcharges implemented during the onset of electricity deregulation in the state in 1999. The utility argues that rates will only increase about 6%, and will be well worth the investment to improve reliability as well as to create 5,800 jobs.
Other utilities in New Jersey and along the East Coast have filed rate increases in wake of major recent storms including Superstorm Sandy, which left thousands without power for weeks. Many of these rate hikes have already been approved, despite outcries from concerned citizens and consumer protection agencies.
Residents and businesses won’t be able to avoid the rate hike, if approved, since it is distribution-related. Customers in New Jersey can still shop around for a retail electricity provider that offers lower rates than PSE&G. Currently, PSE&G’s Price-to-Compare is around 11 cents per kilowatt hour.