Jul 26, 2014
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Legislators: JCP&L's Quest for Rate Hike May Be Over

State judge files brief recommending $200 million rate cut rather than proposed rate hike

Legislators: JCP&L's Quest for Rate Hike May Be Over
State legislators said Thursday that Jersey Central Power & Light's request for a rate hike may be over – and a reduction in rates is now possible.

The electrical utility had asked state regulators last year for $31 million rate increase, but faced staunch opposition from elected officials who have consistently blasted FirstEnergy, JCP&L's parent company, for its response to Tropical Storm Irene and Hurricane Sandy's impacts on its service area.

On Wednesday, a state administrative law judge not only filed a brief rejecting the rate hike proposal, but called for the state Board of Public Utilities to reduce rates by $207 million – enough to reduce customers' electric bills by as much as one third.

"We opposed JCP&L's rate increase proposal on principle," said state Sen. James Holzapfel, a Republican who represents northern Ocean County. "There were serious charges from state regulators that the utility had been earning more than was permitted. At the same time, the utility had demonstrated serious failures in responding to hurricanes Irene and Sandy and numerous other storms. It was clear JCP&L was both charging customers too much and not investing in preventative maintenance and upgrades that would prevent outages. Given these inconsistencies, we continue to believe JCP&L doesn't deserve an extra cent of ratepayers' money."

"That would be a real victory for customers who have long believed that JCP&L has been intentionally ignoring New Jersey's needs to ship increased profits to their parent company in Ohio," said Assemblyman David Wolfe (R-Ocean).

Assemblyman Gregory P. McGuckin called JCP&L's 1.1 million customers statewide "abused" by FirstEnergy and said he was looking into "allegations of overcharging and shoddy maintenance by JCP&L since 2012."

A company spokesman told the Newark Star-Ledger that the company will file a reply to the judge's brief, saying the situation "is not over."

It will ultimately fall to the BPU to set energy rates for JCP&L's customers.

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