Siding with New Jersey Ratepayer Advocate Blossom Peretz’spleadings for moderation, the New Jersey Board of Public Utilities(BPU) at a special meeting yesterday granted provisional approvalto three utilities for the minimum requested rate increase to passon the rising commodity cost of natural gas. New Jersey NaturalGas (NJNG) received the 16% it petitioned for, but ElizabethtownGas (ETG) and Public Service Electric and Gas Co. (PSE&G)received far less than requested.

“A rate increase is never a happy event for ratepayers, but wesaw a lot of mitigation in here that could help ratepayers getthrough this crisis,” said Peretz. The rates will become effectiveas soon as the board signs a formal order, which is expected by theend of the week.

The special meeting was in response to applications filed byfour utilities in an attempt to get the board moving quickly onpreviously-filed rate increase proposals. Because ofdifferentiating rate term periods, yesterday’s meeting onlyinvolved the rate increase proposals of NJNG, ETG and PSE&G.South Jersey Gas’ rate term begins on Nov. 1, so the BPU will hearits case at a later date.

In its rate hike petition, ETG requested a 17.3 to 30% increase,but the board only approved the 17.3% hike. Likewise, PSE&Gwanted 24%, but instead only received 16%. ETG and PSE&Gupdated their initial requests of 18% and 13% respectively aftergas costs went up over 50% after they filed. “There were filingsmade some months back, and since that time there have beenincreases above and beyond what the companies’ had sought,” saidETG spokesman George Koodray.

Starting in December 2000 and going through April 2001, the gascompanies may adjust their overall customer bills by 2% in eitherdirection each month to reflect the current market conditions.

“I would call it a win because we got utilities to come downmore than we had anticipated, and it is a win because we gotbenefits for ratepayers that they have never had before, likeextended payment plans without interest,” said Peretz. “I think itis also a win because the board directed that utilities with theirfilings have to give the board information on their long termenergy plans, which is something we advocate. We want them to beaware of the possibilities of hedging; we want them to diversifytheir portfolios so they don’t have all of the same kinds ofcontracts; we want them to use the spot market at certain times;and we want them to store their natural gas.”

NJNG spokeswoman Lori Backer commented on the decision., “We arehappy with the increase because as far as timing goes, we had filedfor this in July and we were hoping for an October implementationor decision on it. As soon as the weather starts turning cold, andpeople start using gas and we are still billing at the lower rate,we are creating a potential under-recovery. So the sooner we get toimplement the rate, the less of a deficit we start building.”

NJNG said under the pending plan its customers prices would risefrom $.7633 to $.8963 per therm, or about $12 a month on average.

“I think the utilities were aware that ratepayers have to beable to afford energy and they were not happy about coming in withlarge rate increases,” said the ratepayer advocate. “The cost willbe recovered sometime, but we did not want to see an initial rateshock during the winter season for customers.”

She stressed the importance of energy conservation, includingproper insulation, thermostat management, and proper caulking onwindows. She also pointed out that customers in crisis should takefull advantage of available state and federal funds.

In August, SJG filed for a 19% rate increase, which it lateramended to 22 to 39.7%. Its rate case will go before BPU within thenext few weeks.

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