State Agency Rules Environmental Groups Can’t Intervene in PSE&G Rate Case

BPU decision enables organizations to present oral arguments but not cross-examine other participants

Jeff Tittel, director of the New Jersey Sierra Club
When Public Service Electric & Gas is grilled about its $4 billion plan to upgrade its power grid, it may not have to respond to extensive queries about why the proposal does not include more projects to promote energy efficiency and other measures to conserve energy use.

The New Jersey Board of Public Utilities yesterday upheld a decision by one of its commissioners to deny two of the most prominent environmental groups intervener status in PSE&G’s current rate case. Instead, the groups will be allowed to participate in the proceedings, with a much less prominent role granted to others in the case.

In deciding not to grant intervener status, BPU staff and officials agreed with the utility that the request by the New Jersey Sierra Club and New Jersey Environmental Federation focused primarily on issues unrelated to the PSE&G case, an argument the utility made in filings to the agency. The utility argued the case does not primarily focus on environmental issues.

The current case reflects issues that are sure to be sharply debated by the agency in the coming months as it conducts a number of proceedings to determine how the state can best avert the widespread power outages that occurred last October, when Hurricane Sandy left more than 7 million people without power.

The case stems from a proposal submitted by the state’s largest gas and electric utility this past February, which details an ambitious investment program to harden its power grid to be more resilient to extreme weather. The utility has called the program “Energy Strong.’’

The BPU staff suggested and its five commissioners agreed that the program to make the power grid more resilient involves preventing problems such as flooding of substations and switching stations, which led to hundreds of thousands of customers being without power.

Public hearings on the case began this week and evidentiary hearings on the proposal are expected to begin in January, according to a schedule established by the BPU.

In denying the two environmental organizations intervener status, the state agency modified an original order, allowing the groups to present oral arguments but not cross-examine other participants.

Jeff Tittel, director of the New Jersey Sierra Club, said the organization was glad the agency had granted more participation in the case.

“The modified order will allow us to do oral arguments so important environmental issues can be raised,’’ Tittel said “Renewable energy, distributive generation [projects that produce electricity for local communities and institutions], and energy efficiency must be included in this proposal or else we are wasting $4 billion of ratepayer money and we could be jeopardizing federal funding coming into New Jersey.’’

The PSE&G case is shaping up to be one of the more controversial issues to come before the BPU in recent years. Its plans to harden its power grid, which saw millions of customers lose power during Hurricane Sandy, have been endorsed by many business groups, local communities, and county officials.

Others, however, including the state chapter of AARP and a coalition representing large energy users in New Jersey, questioned the size of the utility’s proposal and its mechanism for recovering the cost of the program.

In endorsing the decision by his fellow commissioner, BPU President Bob Hanna said the agency has to keep control of its docket.

“I think Commissioner [Joseph] Fiordaliso got it right,’’ Hanna said at the agency’s monthly meeting in Trenton, while arguing the environmental organizations’ views will not be ignored. “Their views will be seriously considered by the staff and commissioners.’’

The agency also denied a request by PSE&G to intervene in another case before the BPU. It did not allow the utility to intervene in a case where New Jersey Natural Gas would supplant the Newark company in providing fuel to a Sayreville power plant.