I/M/O the Petition of South Jersey Gas Company to Change
the Level of Its Remediation Adjustment Clause (RAC)
BPU Docket No. GR01080472;
OAL Docket PUCRA 00927-03S

I/M/O the Petition of South Jersey Gas Company to
Implement its Transportation Charge (TIC)
BPU Docket No. GT02080625
OAL Docket No. PUC 2262-03S

Voorhees, New Jersey
May 13, 2003

  Good evening.  My name is Debra Robinson, and I am an attorney representing the New Jersey Division of the Ratepayer Advocate.  Our office 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.

South Jersey Gas Company (“South Jersey” or the “Company”) has filed a petition requesting that the New Jersey Board of Public Utilities (“Board” or “BPU”) approve certain changes to its tariffs. The petition includes the following:

1) South Jersey proposes to reduce the level of recovery of its Remedial Adjustment Clause (“RAC”). The RAC is a Board-approved program that permits the Company to recover the costs of cleaning up contaminated former manufactured gas plants for which the Company is responsible. The current RAC  charge is $0.0107 per therm.  The Company proposes to reduce that charge to $0.0069 per therm, a reduction of $0.0038 per therm.  The reduction would result in a decrease of $0.38, or 32%, for a typical residential heating customer using 100 therms of gas during a month.

2) South Jersey also proposes that the same rate currently used to calculate carrying costs on unamortized RAC balances be used to calculate deferred tax benefits resulting from the RAC.  This adjustment would be made each August 31, coincident with the adjustment for the interest rate applicable to unamortized RAC balances.

3) South Jersey also proposes to implement a Transportation Initiation Clause (“TIC”), which is designed to recover capital expenditures and operating costs, including consulting and transaction costs associated with electronic data interchange. The proposed rate for the TIC would increase a typical residential customer’s bill using 100 therms during a month by $0.02, or 0.01%.

The rate changes proposed by South Jersey in this petition would result in a rate decrease of  $0.36, or 0.31%, for a typical residential heating customer using 100 therms during a month.

The Ratepayer Advocate is conducting a complete investigation and evaluation of the Company’s requests based upon the information that is being supplied and updated by the Company.  We have retained the services of a utility accounting expert to assist us in our review of these cases.   The Ratepayer Advocate’s inquiry is focused on the critical issues of whether the Company’s proposal allows ratepayers to pay the lowest rates possible consistent with receiving safe, reliable and proper service.  However, the New Jersey Board of Public Utilities, with legal submissions from the parties, including the Ratepayer Advocate, will make the final decision regarding the utility’s’ requests for rate changes.

The purpose of this hearing is for you, the customer, to voice your opinion, relate your experiences and offer comments about your Company’s rates and any service problems you may be experiencing.  It is important that you express your views so they may become part of the record on which the Board of Public Utilities makes its decisions.  The Ratepayer Advocate also needs to hear your views.  Your active participation is strongly encouraged to help in our evaluation of the Company’s proposals and our preparations for the evidentiary hearings.

This hearing is being transcribed and your comments will become part of the record.  I would like to reiterate the importance of your participation so that the Ratepayer Advocate can have a clear record of your concerns and interests.

On behalf of the Ratepayer Advocate, I would like to thank you for attending tonight’s hearing.

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