REMARKS OF SEEMA M. SINGH, ESQ.
RATEPAYER ADVOCATE
PRESENTED BY SARAH H. STEINDEL
DEPUTY RATEPAYER ADVOCATE
DIVISION OF THE RATEPAYER ADVOCATE

  I/M/O the Motion of Public Service Electric and Gas Company To Increase Its Gas
Plant Remediation Adjustment Clause & To Make Changes in Tariff Rates
B.P.U.J.N.J. No. 13, Gas Pursuant to N.J.A.C. 48:2-21 and 48:2-21.1
BPU Docket No. GR03060436
OAL Docket No. PUC 07334-03N
 
PUBLIC HEARING
Hackensack, New Jersey
November 20, 2003

   

My name is Sarah Steindel.  I am an attorney representing the New Jersey Division of the Ratepayer Advocate.  The Division of the Ratepayer Advocate (the “Ratepayer Advocate) was created by the New Jersey Legislature to represent ratepayers in cases such as this where a utility seeks an increase in rates or change in services. 
        Public Service Electric & Gas (“PSE&G”) has filed a Petition with the Board of Public Utilities to recover $18.645 million expended in its Manufactured Gas Plant Remediation Program (Remediation Program or Program Costs). This Remediation Program was developed to clean up the Company’s 38 former manufactured gas plant sites under the direction of the New Jersey Department of Environmental Protection with financial oversight by the Board of Public Utilities and the Division of the Ratepayer Advocate.  Pursuant to Board Order, Program Costs are nallocated to PSE&G’s Gas and Electric Units on a 60/40 percent basis and are recovered over a rolling seven-year period. In this filig the Company is seeking a determination that its Program Costs incurred during the period August 1, 2001 through July 31, 2002 are recoverable effective on or about January 1, 2004. 
    Approval of the requested amount would result in an increase in customers’ natural gas and electric rates. The rate for firm gas, interruptible and transportation customers would be increased from 0.4604 to 0.5695 cents per therm including Sales and Use Tax, an increase of approximately $1.36, or 0.09 percent in the annual bills of a typical residential customer using 1,252 therms per year and 200 therms per month during the winter heating period. The proposed rate for residential electric customers would result in an increase from 0.0340 to 0.0436 cents per kilowatt hour, including Sales and Use Tax, an increase of approximately $0.85, or 0.10 percent in the annual bills of a typical residential customer using 6960 kilowatt hours per year and 722 kilowatt hours per month during the summer. The proposed increases would be reflected in the Societal Benefit Clause rates to be implemented on or about January 1, 2004. 
        Our office represents the public in utility rate cases, and reviews all proposed changes in rates as they affect the various customer classes. As necessary, we work with a team of accountants, economists and lawyers to analyze the cases, especially where there are requests for rate increases.  We are currently conducting a complete and thorough investigation of PSE&G’s request to evaluate the filing.  For that purpose, we will request and review detailed information from the Company about its Remediation Program and the costs incurred.
        In our investigation of this case, the Ratepayer Advocate has focused on the following issues:

  1. The reasonableness of the Company’s expenditures for remediation of its contaminated manufactured gas plants;
  2. The reasonableness of the Company’s Remediation Program, reviewed in relation to existing DEP directives;
  3. The status of the Company’s efforts to obtain reimbursement from other legally responsible parties and insurance carriers; and
  4.  Whether the Company has properly accounted for its remediation costs and recoveries.

         At evidentiary hearings, we will cross-examine PSE&G’s witnesses and submit evidence through the testimony of our witnesses.  However, the ultimate decision regarding all rate modifications in New Jersey is made by the Board of Public Utilities.
        We currently have a team of attorneys and an expert consultant analyzing data from the Company.  As appropriate, this consultant will offer testimony regarding PSE&G’s proposal to increase your rates.  We are in the process of discovery now.

The purpose of this public hearing tonight is for you, the customer, to voice your opinion, relate your experiences and offer comments about PSE&G’s rates and any service problems you may be experiencing.  It is important that you express your views, as they become part of the record on which the Board of Public Utilities makes its decisions.  The Ratepayer Advocate also wants to hear your views.  We strongly encourage your participation, which will help us evaluate the Company’s proposal and prepare for the hearings.
            This hearing is being transcribed and your comments will become part of the record.  Judge McGill of the Office of Administrative Law will instruct you to give your name and address before you speak.  I would like to reiterate the importance of this so that there will be a clear record of your concerns and interests.
            On behalf of the Ratepayer Advocate, I would like to thank you for attending this evening.


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