ABOUT THE
NEW JERSEY DIVISION
OF THE RATEPAYER ADVOCATE

WHAT IS THE DIVISION OF THE RATEPAYER ADVOCATE ?

Established in 1994 through enactment of Governor Christine Todd Whitman's Reorganization Plan, the Ratepayer Advocate represents and protects the interests of all utility consumers - residential, small business, commercial and industrial - each time companies in New Jersey seek changes in how much they charge customers for natural gas, electric, water, wastewater or telephone service. As a member of all state utility policy making groups, the Ratepayer Advocate also represents consumers in setting energy and telecommunications policy that will affect the provision of services into the future.

The mission of the Ratepayer Advocate is to make sure that all classes of utility consumers receive safe, adequate and proper utility service at affordable rates that are just and nondiscriminatory. In addition, the Ratepayer Advocate works to insure that all consumers are knowledgeable about the choices they have in the emerging age of utility competition.

HOW DOES THE RATEPAYER ADVOCATE REPRESENT RATEPAYERS IN RATE CASES?

A utility cannot increase its rates - the charge to consumers for use of utility services - until the New Jersey Board of Public Utilities ("BPU") approves the change. To obtain BPU approval, the utility must "prove" that such a change is merited. The utility files its application with the BPU to demonstrate that an increase is justified.

The Ratepayer Advocate is party to every proceeding  in the State of New Jersey in which utilities seek to alter their rates or services. In each case, the Ratepayer Advocate thoroughly investigates all aspects of the company's request.

The investigation is based on detailed information that the utility provides regarding its request for  changes in service or rate increases. The Ratepayer Advocate's attorneys, along with consulting economists, accountants, and engineers, analyze that information and develop independent conclusions regarding the reasonableness of the utility's request and prepare and file testimony that supports those conclusions and protects ratepayers interests. Later, as a party to evidentiary hearings, the Ratepayer Advocate cross-examines the utility's witnesses and submits evidence to support the Division's position. Subsequently, if necessary, the Ratepayer Advocate will seek a better outcome for ratepayers, by litigation in the appropriate state or federal court.

DOES THE RATEPAYER ADVOCATE NEGOTIATE WITH UTILITIES TO AVOID THE EXPENSES OF LITIGATION ?

Good consumer advocates must be ready to litigate to protect consumers' interests. However, litigation is expensive, and, in the case of utility litigation, a part of the expense may be passed on by utilities to consumers. To avoid the expense of litigation whenever it is in the best interest of ratepayers, the Ratepayer Advocate negotiates with utilities and attempts to settle as many issues as possible without or before going to a contested hearing.

HOW ELSE DOES THE RATEPAYER ADVOCATE WORK FOR RATEPAYERS?

The Ratepayer Advocate plays an active role in policy making. The Division's attorneys participate in the Advisory Council of Energy Planning and Conservation and on the Energy Master Plan Task Force within the BPU. The Ratepayer Advocate is also a member of the BPU's Cable/Telecommunications Task Force, which sets policies to ensure that all New Jersey consumers benefit from new information technologies. Additionally, the Division works with the BPU to develop long-term energy and telecommunications policy and goals that affect all New Jersey ratepayers. By assuring that the consumer's voice is heard at the outset of the ratemaking and policymaking processes, the Ratepayer Advocate promotes the development of consensus and spares the State and its residents the expense and inefficiency of unnecessary litigation.

WILL COMPETITION LOWER UTILITY BILLS?

Customers already have options in choosing their long distance telephone carriers. Current state and federal efforts will give customers more utility choices, with freedom to choose who supplies their local telephone service, cable television, as well as natural gas and electricity service. Effective competition in the energy and telecommunications industries should further the economic and environmental well-being of all New Jersey ratepayers. The Ratepayer Advocate is working with policy groups in New Jersey to insure that competition provides all consumers - including lower income residential customers - with opportunities to realize savings while increasing consumer choice of services.

DOES PARTICIPATION IN PUBLIC HEARINGS MATTER?

Yes! Public hearings provide an opportunity for ratepayers to comment on proposed rate changes as well as utility services. These voices, joined with that of the Ratepayer Advocate, can make a big difference. Speaking at a public hearing is important so ratepayers can communicate their positions to the Board of Public Utilities. Public participation also strengthens the Ratepayer Advocate's challenges to rate increase requests and affects decisions of the BPU.