Prompted by declining market costs for natural gas, the New Jersey Board of Public Utilities (BPU) has approved proposals from the state’s natural gas utilities — Public Service Electric and Gas (PSE&G), New Jersey Natural Gas (NJNG), South Jersey Gas (SJG) and Elizabethtown Gas — that will save their residential and small business customers more than $500 million annually.
The rate reductions were possible thanks to an overall reduction in natural gas prices of 23.5-37.3% compared with prices a year ago, the BPU said.
The BPU approved a PSE&G proposal to reduce its rate 10.4%, trimming the utility’s annual revenue by $142.2 million. Interim reductions taken in January and March had already reduced the bill for an average residential heating customer by $106.41 annually; the new rate will result in an additional reduction of $155.91 for average residential customers.
NJNG, which earlier this year had instituted bill credits that reduced the typical residential heating customer’s annual bill by $107.70, received BPU approval for its request to further reduce those annual bills by $187.70. The BPU also approved NJNG’s latest conservation incentive program (CIP) filing, which will reduce annual bills by another $29.90. The rate reduction approved Wednesday, combined with a bill credit that NJNG said it will institute effective Oct. 1, will reduce NJNG’s annual revenue by $220.4 million.
The BPU approved SJG’s proposal to reduce its annual rate by $215.01 for typical residential customers, and also approved an $83 annual bill credit effective in October and a CIP filing that will reduce charges another $31.30 annually. SJG had already implemented an interim reduction in January, which resulted in a reduction of $26.22 in the average residential heating customer’s annual bill. The latest rate reduction approved by the BPU will result in a reduction of $80 million in SJG’s annual revenue.
Elizabethtown Gas will see its annual revenue decrease $107.2 million as a result of the 37.3% rate reduction approved by the BPU. Typical residential customer bills will decrease by $477 per year. In addition to declining natural gas prices, the utility’s rates also reflect the elimination of charges that had been in effect to recover previous shortages in the calculation of allowable natural gas prices for its customers, the BPU said.
In April the BPU approved $956 million in infrastructure spending by the four gas utilities and Atlantic City Electric (see Daily GPI, April 17). The utilities had submitted proposals in response to a call for expedited infrastructure spending as a means to stimulate New Jersey’s economy.
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