Possible Rate Cut, Refund for JCP&L Customers Hits Yet Another Delay

Tom Johnson | October 1, 2014 | Energy & Environment
BPU grants administrative law judge’s request for more time to reach decision in long-running case

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If customers of Jersey Central Power & Light are going to see a drop in their utility bills, they will have to wait a bit longer — once again.

For a second time, an administrative law judge presiding over a rate case involving the state’s second-largest utility has requested and been granted a 45-day extension for issuing a decision on the issue.

The more than three-year-old rate case started based on allegations by the New Jersey Division of Rate Counsel that the utility was earning above and beyond what regulators said JCP&L was due.

Initially, the utility sought a $31 million increase in revenues from customers, but both the New Jersey Board of Public Utilities and the Rate Counsel’s office argued in testimony before the Office of Administrative Law (OAL) that rates should be rolled back by at least $200 million.

The issue is important to consumers — if the state’s position is upheld, utility bills could drop by one-third, according to some projections. The longer the case takes to resolve, however, the longer customers will wait for any rate relief, if that is the ultimate decision.

Whatever the administrative law court judge recommends, the case will end up being decided by the BPU, which can accept, reject or modify his decision, which is now scheduled to be issued by Nov. 13.

At this point, regulators and consumer advocates worry that even if the judge issues a decision by then — no certainty — it could be some time before a final ruling on the case is issued.

Even BPU President Diane Solomon expressed frustration.

“We have ratepayers waiting for this decision,’’ she said after the board granted the 45-day extension, which essentially it had to approve.

JCP&L had little reaction to the latest delay. “We’re awaiting the judge’s decision,’’ said Ron Morano, a spokesman for the utility, which serves more than 1 million customers in the state.

Others were more blunt.

“We certainly think this needs to be decided,’’ said Ratepayer Advocate Stefanie Brand. “Can you imagine if an utility filed for a rate increase and it took this long?’’

In August, the Rate Counsel’s office filed a petition with the BPU asking the agency to give customers refunds, dating back to Aug. 1, if the agency decides to roll back rates.

In its motion, Rate Counsel argued JCP&L customers are still paying rates identified as unreasonable and excessive three years ago.

Ev Liebman, associate director of ARRP, urged the board to grant the Rate Counsel’s request to establish JCP&L’s rates as provisional, subject to refund immediately.

“Why, when it is residents who deserve to have rates reduced and get a fair break, regulators can’t seem to get the job done in any kind timely way,’’ Liebman said.

The BPU has yet to act on the Rate Counsel’s petition and it did not come up for discussion when the agency granted the extension requested by the administrative law court judge.

JCP&L has faced withering criticism from local officials, customers and the Christie administration over delays in restoring power when widespread outages occur during extreme storm events, such as Hurricane Sandy. Ninety percent of their customers lost power due to storm, some for up to 12 days.