New Jersey Natural Gas Is Not Getting The Rate Increase It Wanted

New Jersey Natural Gas and the state Board of Public Utilities are nearing a rate hike compromise that is significantly less than what the gas company originally wanted.

New Jersey Natural Gas asked for a 24 percent rate hike in November 2015. The final figures call for a 7.4 percent increase, according to a NJNG release.

“We believe a fair agreement has been reached and look forward to the final resolution of this base rate case,” said Laurence M. Downes, NJNG chairman and CEO. “We are confident the ultimate outcome will serve the best interests of our customers and company.”

That would translate into an increase of $7.11 or 7.4 percent monthly increase for the typical residential customer who uses 100 therms per month. The average monthly bill would rise from $95.44 to $102.55, the release states.

If approved, the increase would be the first base rate case filed by the company since 2007.

In June 2016, NJNG announced a net decrease related to the Basic Gas Supply Service (BGSS), which goes towards purchasing the commodity and moving it through the interstate pipeline system. The BGSS rate, along with bill credits and other rate components, would offset the rate case increase for residential customers next year.
This is the first base rate case filed by NJNG since 2007. In the original November 2015 filing, NJNG wanted a $148 million in its base rates. The increase was later revised to $113 million in July.

The rate increase does not include future costs associated with the Southern Reliability Link (SRL), a controversial high-pressure gas transmission pipeline. Construction hasn't started yet on the SRL.

The SRL was approved by the BPU in January and March of 2016 and is currently going through the permitting process.

Image: Patch file photo