Wednesday, May 19, 2010

Where was the BPU while PSEG dodged fees?

“While New Jersey's gas and electric customers have over the past decade paid more than $4 billion in a special surcharge funding special energy programs, an unregulated affiliate of Public Service Electric & Gas has paid nothing, even though it uses about one-third of the gas sold by the utility.”

That’s the lead to a May 7 story written by former Star-Ledger reporter Tom Johnson in NJ Spotlight, a new online news and public affairs publication.

In PSE&G's Largest Gas Customer Dodges Major Utility Fee,
Johnson writes:

“PSEG Power, a supplier of power and PSE&G's largest gas customer, has avoided paying the fee, known as the societal benefits charge (SBC), even though critics say regulatory rules explicitly state that the charge cannot be bypassed.

“By one industry lawyer’s account, the supplier should have paid $47 million into the SBC fund in 2009 alone. Last year, the fund raised $740 million from other customers to finance half a dozen energy-related programs, including reduction of energy consumption, promotion of solar and wind power, and assistance for the poor in paying their utility bills. “

Critics say that by escaping the SBC, PSEG Power is in effect being subsidized by other rate payers and gaining an unfair advantage over competing energy suppliers—some of which pay as  much as $2 million in SBC charges.

How has PSEG managed to get away with it?

Stefanie Brand, acting state Public Advocate and director of the state’s division of rate counsel, told Johnson she was baffled.
“Look at the statue,” she said. “It says the SBC is non-bypassable.”
Which raises the question: Where was the state’s Board of Public Utilities (BPU), the folks who are supposed to review the financial operations of regulated public utilities and their unregulated subsidiaries, while all this was going on?

The BPU says it became aware of PSEG Power’s nonpayment of surcharges only during a recent rate-hearing case.  It has since submitted a brief asking an administrative law court judge to order PSEG Power to make an accounting of the money that should have been paid into the SBC and other funds.
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