PSE&G Files Rates For Energy Strong Program

Wed Mar 20, 2013 10:02am EDT

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Customer bills expected to remain steady while making necessary improvements to
reduce outages
NEWARK, N.J.,  March 20, 2013  /PRNewswire/ -- Public Service Electric and Gas
Company (PSE&G) today said the typical residential customer who receives both
electric and gas from the utility is projected to pay about  $12  less per year
in 2018 than today if the utility gets approval for every project in its "Energy
Strong" program to upgrade its electric and gas distribution systems. The bill
impact assumes that natural gas costs remain low and PSE&G supply costs are at
current levels.  

(Logo:  http://photos.prnewswire.com/prnh/20120830/MM62627LOGO)

On  Feb. 20, PSE&G proposed investing  $3.9 billion  during the next 10 years to
proactively protect and strengthen its electric and gas systems in the face of
increasingly severe weather. Energy Strong would create about 5,800 jobs for
electricians, mechanics, laborers, operating engineers and others, and countless
opportunities for  New Jersey  businesses. The utility has asked for initial
funding approval of  $2.6 billion  during the first five years. Because some of
the improvements will take more time to implement, the utility may seek approval
to spend an additional  $1.3 billion  in the latter five years to complete the
program.

"An energy infrastructure that is better able to withstand storms like Sandy and
other natural disasters can help save NJ businesses hundreds of millions of
dollars in lost revenue and protect our families from the impact of extended
power outages," said  Ralph Izzo, PSEG chairman and CEO. "The good news is that
our customers will get the benefit of a more resilient electric and gas system
while we create thousands of jobs for the state's economy."

In a filing today with the  New Jersey  Board of Public Utilities, the utility
detailed the proposed impacts on customers if the first part of the  $3.9
billion  investment is approved.  

Residential and business bills to remain stable

A typical PSE&G residential combined electric and gas customer is projected to
see their annual bill drop about  $12, or  $1  per month in 2018. Bills will
fluctuate slightly between now and then. In 2014, the average customer's bill
will be about  70 cents  a month higher than 2013 and about  $1.50  a month
higher in 2015. Bills will then begin to drop. In 2016 the average bill will be
about  $4.70  a month lower than 2013 and  $2.90  a month lower in 2017 compared
to 2013. The above bill impacts assume current PSE&G supply costs.  

The utility estimates that in 2018, a typical annual residential electric bill
will be approximately 3 percent lower than it was in 2008 and a typical gas bill
will be approximately 33 percent lower -- even with the proposed additional
spending - and still well below the rate of inflation.  

Business customers also are projected to see lower overall bills in 2018
compared to current bills. For example, an industrial electric customer using 85
million kilowatt-hours per year, with a usage pattern similar to a class average
primary voltage customer*,  is projected to pay approximately  $1 million  less
in 2018 than today even if every project in Energy Strong was approved by the
BPU. This bill also assumes current PSE&G supply costs.

The stability of bills is due to a number of factors. First, the price of
natural gas has dropped nearly 40 percent in the past four years, lowering the
cost of heat and electricity. Second, some charges currently included in
customer bills will expire in 2014, 2016 and 2017. Two of those charges are
related to the deregulation of the  New Jersey  energy market. The Transitional
Energy Facility Assessment will expire in  January 2014  and the Securitization
Transition Charge expires in 2016. A third charge, the Non-Utility Generation
Charge, will approach zero in  January 2017.

PSE&G is seeking BPU approval to begin the Energy Strong program on  July 1,
with initial rates effective  Jan. 1, 2014.  

"How many more destructive storms can  New Jersey  endure before we take action
to create a more resilient utility system?" Izzo said. "We cannot afford to
delay. We look forward to productive discussions with our regulators to
prioritize what needs to be done and when."    

PSE&G's "Energy Strong" program would make improvements to its distribution
system to reduce the number and duration of power outages caused by severe
storms. The improvements include:

* protecting more than 40 utility installations from storm surges,  
* strengthening distribution lines,  
* making the electric grid smarter and thereby easier to restore customers, and 

* modernizing the gas distribution system.

Energy Strong has support from a diverse group of business, labor and municipal
leaders.  

For more information about Energy Strong, visit  www.pseg.com/energystrong.

*A primary voltage customer maintains their own transformer and uses 4,000 or
13,000 volts.  

Forward Looking Statement

Certain of the matters discussed in this report constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements are subject to risks and uncertainties,
which could cause actual results to differ materially from those anticipated.
Such statements are based on management's beliefs as well as assumptions made by
and information currently available to management. When used herein, the words
"anticipate," "intend," "estimate," "believe," "expect," "plan," "should,"
"hypothetical," "potential," "forecast," "project," variations of such words and
similar expressions are intended to identify forward-looking statements. Factors
that may cause actual results to differ are often presented with the
forward-looking statements themselves. Other factors that could cause actual
results to differ materially from those contemplated in any forward-looking
statements made by us herein are discussed in Item 1A. Risk Factors, Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations (MD&A), Item 8.  Financial Statements and Supplementary Data -Note
13. Commitments and Contingent Liabilities, and other factors discussed in
filings we make with the United States Securities and Exchange Commission (SEC).
 


These factors include, but are not limited to:

* adverse changes in the demand for or the price of the capacity and energy that
we sell into wholesale electricity markets,  
* adverse changes in energy industry law, policies and regulation, including
market structures and a potential shift away from competitive markets toward
subsidized market mechanisms, transmission planning and cost allocation rules,
including rules regarding how transmission is planned and who is permitted to
build transmission in the future, and reliability standards,  
* any inability of our transmission and distribution businesses to obtain
adequate and timely rate relief and regulatory approvals from federal and state
regulators,  
* changes in federal and state environmental regulations that could increase our
costs or limit our operations,  
* changes in nuclear regulation and/or general developments in the nuclear power
industry, including various impacts from any accidents or incidents experienced
at our facilities or by others in the industry, that could limit operations of
our nuclear generating units,  
* actions or activities at one of our nuclear units located on a multi-unit site
that might adversely affect our ability to continue to operate that unit or
other units located at the same site,  
* any inability to balance our energy obligations, available supply and risks,  
* any deterioration in our credit quality or the credit quality of our
counterparties, including in our leveraged leases,  
* availability of capital and credit at commercially reasonable terms and
conditions and our ability to meet cash needs,  
* changes in the cost of, or interruption in the supply of, fuel and other
commodities necessary to the operation of our generating units,  
* delays in receipt of necessary permits and approvals for our construction and
development activities,  
* delays or unforeseen cost escalations in our construction and development
activities,  
* any inability to achieve, or continue to sustain, our expected levels of
operating performance,  
* any equipment failures, accidents, severe weather events or other incidents
that impact our ability to provide safe and reliable service to our customers,  
* increase in competition in energy supply markets as well as competition for
certain rate-based transmission projects,  
* any inability to realize anticipated tax benefits or retain tax credits,  
* challenges associated with recruitment and/or retention of a qualified
workforce,  
* adverse performance of our decommissioning and defined benefit plan trust fund
investments and changes in funding requirements, and  
* changes in technology and customer usage patterns.

All of the forward-looking statements made in this report are qualified by these
cautionary statements and we cannot assure you that the results or developments
anticipated by management will be realized or, even if realized, will have the
expected consequences to, or effects on, us or our business prospects, financial
condition or results of operations. Readers are cautioned not to place undue
reliance on these forward-looking statements in making any investment decision.
Forward-looking statements made in this report apply only as of the date of this
report. While we may elect to update forward-looking statements from time to
time, we specifically disclaim any obligation to do so, even if internal
estimates change, unless otherwise required by applicable securities laws.  The
forward-looking statements contained in this report are intended to qualify for
the safe harbor provisions of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

Public Service Electric and Gas Company (PSE&G) is  New Jersey's oldest and
largest regulated gas and electric delivery utility, serving nearly
three-quarters of the state's population.  PSE&G is the winner of the
ReliabilityOne Award for superior electric system reliability.  PSE&G is a
subsidiary of Public Service Enterprise Group Incorporated (PSEG) (NYSE: PEG), a
diversified energy company (www.pseg.com).

Want to know what's new at PSEG? Go to  www.pseg.com/getnews  and sign up to
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SOURCE  Public Service Electric and Gas Company (PSE&G)


Media: Karen Johnson, +1-973-430-7734, Customers & others: 1-800-436-7734

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