Public Service Electric and Gas Co., New Jersey's largest utility, has proposed a $4.1 billion plan to reduce energy consumption and carbon emissions, including hundreds of millions for electric vehicle infrastructure, energy storage, and smart meters.
PSE&G says its six-year Clean Energy Future program would increase a typical residential bill about 50 cents a month in 2019, increasing to $7 a month by 2024. But it maintained that program would save customers $7.4 billion in "lifetime energy costs" through reductions in consumption.
Ralph Izzo, chairman of PSE&G's parent company, Public Service Enterprise Group, called the program a "historic investment" that would help meet Democratic Gov. Murphy's ambitious clean energy and climate goals.
"This is in lockstep with Gov. Murphy's clean energy goals for the state," Dave Daly, the utility's president, said in a news briefing Thursday.
The proposal was greeted warily by New Jersey's ratepayer advocate and by large industrial users, who say PSE&G's latest effort would generate hefty guaranteed returns for the utility's shareholders to finance programs that best could be provided in the competitive market.
"From a utility perspective, it's attractive," said Steven S. Goldenberg, spokesman for New Jersey Large Energy Users Coalition. "From a consumers' perspective, these are very expensive programs."
New Jersey Rate Counsel Director Stefanie A. Brand, the state's ratepayer advocate, called the energy-efficiency proposal "pretty radical" because it would give the utility a virtual monopoly over conservation programs in its territory, including some work now managed by the state's Office of Clean Energy.
"You're taking something that's basically a competitive industry and inserting an 800-pound gorilla in there," she said.
Brand also said the estimated $4.1 billion cost does not include PSE&G's expected claim to recover "lost revenue" from lower electricity sales.
The proposal will require the approval of the Board of Public Utilities, the state regulator that operates in close harmony with the governor's office.
PSE&G has been building public support for its energy efficiency investment for more than a year, calling on the state to move away from a traditional rate structure that encourages utilities to sell as much energy as possible and toward a new system that provides incentives to promote efficiency and conservation.
Under the new proposal, PSE&G would spend:
The Clean Energy Future proposal is PSE&G's latest plan to boost rates to pay for infrastructure investments, though the utility notes that customers bills have come down since peaking in 2008 before the energy prices declined dramatically because of the shale boom.
In addition to the new $4.1 billion energy-efficiency plan, the utility currently has a $2.5 billion Energy Strong II proposal before New Jersey regulators, in addition to a PSEG-initiated plan to recover about $300 million a year to support the state's nuclear industry.