PolitickerNJ Wire Feed

By Jason Butkowski | November 14th, 2012 - 2:06pm
| More

RESOLVING RATE COUNSEL CHARGES LEVELED AGAINST JCP&L MUST BE BPU'S FIRST ORDER OF BUSINESS

 

EDISON - Senator Barbara Buono today urged the state Board of Public Utilities to withhold approval of any pending rate increases for Jersey Central Power & Light until it determines whether the utility has overcharged its New Jersey customers by tens of millions of dollars while failing to invest adequately in the infrastructure and staffing needed to restore service quickly after major storms.  

 

“There is no way that the BPU should consider JCP&L’s pending request for a rate increase to cover the $164 million cost of Hurricane Irene and the October ice storm in 2011 until after it resolves the serious charges brought by the Division of Rate Counsel against the company,” Buono said. 

 

Buono noted that Stefanie Brand, the Christie administration’s rate counsel, determined last April – six months before Hurricane Sandy -- that JCP&L, which is owned by Ohio-based FirstEnergy, was earning excess profits while failing to deliver sufficiently reliable service, and appropriately requested a full review of the utility’s base rates which has yet to be completed.  

 

“The Division of Rate Counsel’s energy consultant determined that JCP&L took up to $90 million more from its New Jersey customers than it should have in 2010,” Buono said. “That represented a 12.37% rate of return on investment for the Ohio-based conglomerate from its New Jersey customers, far higher than the 8.75% profit authorized by the New Jersey BPU.”

 

Buono noted that Robert Henkes, the Division of Rate Counsel’s outside expert, found that JCP&L’s 12.37% profit far exceeded the “zone of reasonableness,” compared to the 8.21% earned by PSE&G, the state’s largest utility with almost 2 million electricity customers; the 8.21% profit earned by Rockland Electric in North Jersey; and the 8.69% rate of return for Atlantic City Electric Company.

 

“But just as troubling are the allegations that JCP&L’s failure to adequately restore service after Hurricane Irene and the major ice storm was a result of a failure to invest adequately in infrastructure, of staffing cuts made after JCP&L’s acquisition by FirstEnergy, and of the inability of the Ohio-based company to plan for a multi-state crisis like the one we just experienced,” Buono said.

 

Buono noted that the BPU’s August 9, 2011 report on the performance of the state’s electric utilities in the major storms of 2011 was particularly critical of JCP&L, which has 1.1 million customers in New Jersey, and that citizen complaints at the public hearings following those storms were directed almost entirely at JCP&L.

 

Brand, the Division of Rate Counsel director, wrote in her 2011 petition challenging  JCP&L’s rates that “one way for a utility to increase its rate of return for its investors is to reduce its investment in the plant and equipment needed to provide its customers with safe, adequate and proper service."

 

Buono said the BPU’s review of utility performance during the 2011 storms specifically required JCP&L to “provide a detailed staffing review that explains the decreases in operations headcount.” Since 2002, JCP&L cut its operations personnel by 12%, its logistics personnel by 26% and its customer service personnel by 27%, the BPU study found. PSE&G’s staffing level since 2002 had remained unchanged.

 

 

“We are grateful to JCP&L’s employees, like those at PSE&G, Atlantic Electric and Rockland, who worked long and hard to restore service to consumers,” Buono said. “But it is critical that our review of JCP&L’s performance in the aftermath of Hurricane Sandy focus on just where and when FirstEnergy allocated its resources, and whether New Jersey’s needs got the proper attention.”

Contact Info: 

Jim Griffin
Senator Barbara Buono's District Office
Tel: (732) 205-1372
E-Mail: jgriffinnj@gmail.com

Wake-Up Call

Morning Digest: September 29th

Winners and Losers: Week of September 22nd WINNERS Tom MacArthur In arguably the most competitive contest of the season, the CD3 Republican candidate forced Comcast to take down an inaccurate Democratic Congressional Campaign Committee (DCCC) television advertisement – the second of three forced off the air. "Our attorney was...

Op-Ed

Legislation needed for publicly financed gubernatorial elections

By JEFF BRINDLE It is critical that the Legislature soon enact a pending bill that would ensure the state’s Gubernatorial Public Financing Program is available in the event of a special election for governor.  Not only is there no current legal... Read More >

Contributors

In tribute to John Sheridan, a good and great man     I first learned late last night from television news that John P. Sheridan, Jr. and his wife, Joyce had... more »
(9-24-14) The Founding Fathers and the Militarization of the Police - No matter what the grand jury in Ferguson, Missouri decides, the debate over the militarization of... more »
(Trenton, NJ) --  On September 23, 2015 I shall dig this up and eat whatever crow I've got coming, but in the meantime only a listicle... more »
 The following letter was sent today to Republican state legislators, county chairs, state committee members, and New Hampshire... more »

Quote of the Day

quote of the day

"After not responding to messages all week seeking an interview about the campaign, Garrett’s spokeswoman said on Friday afternoon that she would try to set one up, but did not respond further. Garrett has not released any announcements of where he would be campaigning, though he has posted pictures on social media on Sept. 8 from the Greenwood Lake Air Show in West Milford and on Sept. 14 from the Hackettstown Street Fair. Garrett has not agreed to any debates so far." - columnist Herb Jackson

- The Bergen Record

Poll

Who won that CD3 NJTV debate?:

Blogroll

Visit the PolitickerNJ.com/resources page for links to the best collection of information on New Jersey state government.

 

  • Polls
  • The best blogs
  • Columnists
  • State election results
  • Assembly election results
  • Local party websites
  • And more.

PolitickerNJ.com/resources