West Orange Chronicle

Town Council Tables 'Energy Strong' Resolution Again

West Orange Chronicle — Tuesday, May 7, 2013

By Melinda Stevens
Staff Writer

The Township Council tabled a resolution to support PSE&G's "Energy Strong" program for a second time at the April 23 council meeting.

According to PSE7G, the program's goal is to strengthen energy infrastructure in New Jersey through improvement of its gas and electric systems. Council President Victor Cirilo said the resolution was tabled due to the need for more information.

"My colleagues felt that they needed more information pertaining to the full 'Energy Strong' proposal prior to providing a municipal endorsement," Cirilo said through email correspondence with the Chronicle last week. "Furthermore, we must be fully informed on the type of impact, if any, that rate-payers may be faced with."

PSE&G has proposed investing $3.9 billion during the next 10 years to proactively protect and strengthen its electric and gas systems against increasingly frequent and severe weather conditions, according to a press release from PSE&G.

According to PSE&G, the program would include protecting more than 40 utility installations from storm surges; strengthening distribution lines; making the electric grid smarter, thereby making it easier to restore electricity to customers during a blackout; modernizing the gas distribution system; and creating 5,800 direct and indirect jobs, which will stimulate substantial economic activity for New Jersey businesses, according to the release.

"An energy infrastructure that is better able to withstand storms like Sandy and other natural disasters can help save N.J. businesses hundreds of millions of dollars in lost revenue, and protect our families from the impact of extended power outages," Ralph Izzo, PSE&G chairman and CEO, said in the news release.

"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," Izzo said.

PSE&G is awaiting approval by the New Jersey Board of Public Utilities for the proposed program. The company first proposed the plan in February, and is seeking approval from the BPU to begin moving forward with the program July 1.

According to a spokesperson from the NJBPU, the See PSE&G, Page 5 board is currently waiting for more information from PSE&G in order to move forward with the request. At the request of the NJBPU board, additional paperwork to further evaluate the cost, benefit and rate impact of any proposed mitigation measures has been requested.

Once the information requested is received, the staff will review it to ensure it is complete and, if so, will then open a formal proceeding, including public hearings and opportunities for interested parties to participate.

The utility's $3.9 billion plan proposes spending $2.6 billion in the first five years, with a potential investment of another $1.3 billion during the following five years. Key provisions to the plan available on the PSE&G website include: $1.7 billion to raise, relocate or protect 31 electric switching stations and substations affected by recent storms as well as those in newly designated flood zones; $1.04 billion to replace and modernize 750 miles of low pressure, cast-iron gas mains in or near flood areas; $454 million for smart-grid technologies that will add intelligence to the system and increase the utility's ability to detect problems and make fixes; S215 million to improve pole distribution systems; $200 million to create additional redundancy in the system, reducing both the amount and time of outages; $60 million to bury 20 miles of overhead electric distribution lines in areas that could see the biggest benefit; and $140 million to protect nine natural gas metering stations and a liquefied natural gas station affected by Sandy or located in flood zones.

According to the PSE&G press release, the company does not expect the expenses associated with the "Energy Strong" program to have a significant impact on customers' bills. The company stated that electric and gas bills are expected to remain stable through 2018.

Factors for the stability include the price of natural gas dropping by 40 percent in the past four years, which has lowered the cost of heat and electricity, and charges currently included in customers bills that are due to expire in 2014, 2016 and 2017.

Two of the 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 will expire in 2016. A third charge, the non-utility generation charge, will approach zero in January 2017, according to the release.

West Orange resident and executive director of New Jersey Citizen Action Phyllis Salowe-Kaye said that she and others at NJCA are happy that the West Orange Town Council did not adopt the resolution right away.

"We are glad they held the resolution," Salowe-Kaye said in a phone interview this week. "We are a little concerned about who is going to bear the cost besides the ratepayers. They are predicting they won't have another increase and we believe it is a sham to the rate-payers."

NJCA is a citizen watchdog coalition that works to protect and expand the rights of individuals and families, according to the NJCA website.

Salowe-Kaye further stated that the Energy Strong program projects a decrease in natural gas and therefore the rates on electric bills will decrease, but she wants to know how the company can be so sure it will decrease.

"We are really concerned to see how they can predict that there will be a decrease in natural gas," Salowe-Kaye said. "They say rates will keep going down because natural gas prices are going down, but what will they do if the prices don't go down?

"These are all questions that need to be answered and this is a high risk investment."

The Energy Strong program has received support from various municipal leaders, including mayors Joseph Parisi of Englewood Cliffs and Chris Bollwage of Elizabeth, according to PSE&G's website.

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