PSE&G gets approval for second phase of gas system modernization program
The New Jersey Board of Public Utilities gave the go ahead for PSE&G to continue to modernize aging natural gas pipes in 2024 through 2025.
With this approval, PSE&G will begin the second phase of its Gas System Modernization Program (GSMP). The state’s largest utility expects to invest $902 million over two years.
The extension allows PSE&G to replace at least 400 miles of aged pipes with modern ones. This will improve reliability and reduce greenhouse gas emissions by approximately 54,000 metric tons CO2e.
While nearly 1,800 miles of cast iron and unprotected steel mains have already been replaced in recent years, PSE&G has largest number of aging cast iron pipes among all U.S. utilities. Many of them are 70 to 100 years old.
“Continuing this work that reduces methane emissions and enhances the reliability of our gas system is a critical step to realizing our Powering Progress vision for customers,” Kim Hanemann, president and chief operating officer, PSE&G, said. “Natural gas has been the most affordable heating option for millions of New Jersey customers for years. We’re pleased to continue our balanced approach to decarbonization while meeting today’s energy demand.”
In this next phase, PSE&G will prioritize and replace pipelines most prone to leaks, including many in municipalities that have a significant number of overburdened communities. Also, it will maintain the infrastructure through upgraded equipment, such as modern regulators and the installation of excess flow valves, with the aim of enhancing safety. The installation of new pipes will result in the immediate reduction of leaks.
The updated lines are also more reliable. When Tropical Storm Ida caused widespread flooding in September 2021, 90,000 gas customers were spared shutoffs due to the company’s modernizing efforts.
The extension is forecasted to increase monthly average gas bills for the typical residential gas customer by about 3.8 percent or $3.50 per month. PSE&G residential gas bills are now approximately 35 percent lower than in 2008.
As part of this settlement, PSE&G also agreed to defer action on its third phase of GSMP, with the parties to reconvene on it by no later than Jan. 31, 2025. Work covered under the third phase, if approved, would be expected to commence in January 2026.
