New Jersey Board of Public Utilities approves settlement of PSE&G distribution base rate review

The New Jersey Board of Public Utilities (BPU) approved Monday the settlement of the distribution base rate review for PSE&G.

The agreement provides for a net $13 million reduction in annual revenues. The company will receive an additional $212 million in annual revenues, including recovery of storm costs that was previously deferred but return $225 million in tax savings largely due to tax reform.

Due to the agreement, the bill for a typical combined residential electric and gas customer will decrease by 0.1 percent or approximately $2 per year. Bills for commercial and industrial electric customers will not change, while gas customers will see a decrease of one to two percent on average. New rates will become effective on Nov. 1.

“We’re pleased that the BPU approved the agreement we had reached with Board staff, the Division of Rate Counsel, and several other parties,” Dave Daly, PSE&G president and COO, said. “The agreement will enable us to keep customer bills essentially flat while providing the ability to invest in our electric and gas systems.”

The settlement agreement provides for a distribution rate base of $9.5 billion, a return on equity of 9.6 percent and a 54 percent equity ratio.