WALL, N.J.--(BUSINESS WIRE)--Mar. 29, 2019--
As previously agreed to with the New Jersey Board of Public Utilities
(BPU) in 2016, New Jersey Natural Gas (NJNG) today filed a base rate
case that includes necessary cost recovery for operational and
maintenance enhancements and critical investments in safety and
environmental sustainability priorities.
The petition seeks a base rate increase of $128.2 million, which enables
NJNG to maintain and enhance an industry-leading natural gas delivery
system serving customers throughout Monmouth, Ocean, Morris, Middlesex
and Burlington counties.
“We continuously invest in our natural gas infrastructure to safely
operate a reliable and environmentally responsible system that keeps
over 544,000 customers’ homes warm and businesses running,” said Steve
Westhoven, president and COO of New Jersey Natural Gas. “These
investments periodically require base rate adjustments, achieved through
a rigorous approval process with regulators, to ensure our customers
have safe and reliable service when they need it. We look forward to the
successful resolution of this base rate case that is in the best
interest of our customers and our company.”
The proposed rate adjustment is necessary to cover the costs associated
with the responsible operation of NJNG’s business, including its
substantial infrastructure investments. Since its base rates were last
approved by the BPU in 2016, NJNG has:
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Invested more than $600 million to upgrade and enhance the safety and
reliability of its transmission and distribution systems.
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Installed over 370 miles of new main to support safe and reliable
service for its customers.
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Responsibly acted to keep its system safe and environmentally sound by
retiring or replacing approximately 200 miles of aged infrastructure.
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Increased workforce and operating expenses to meet the needs of its
customer base.
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Created the most environmentally responsible natural gas delivery
system in New Jersey with the fewest leaks-per-mile of any natural gas
utility in the state.
If approved in full, the monthly bill for a typical residential heating
customer using 100 therms a month would go from $101.89 to $121.27, an
increase of $19.38. Even with the proposed increase, customers’ bills
would still be nearly 30 percent lower than 2008 bills due to the
decline in wholesale natural gas prices.
Natural gas bills consist of two main parts. The delivery charge, which
includes base rates, covers the cost of providing natural gas to
customers, including maintaining its operations and delivery systems, as
well as the ability to earn a fair return on capital investments, which
helps support future upgrades to our systems. The second part is the
Basic Gas Supply Service (BGSS), or the portion of the bill that goes
toward purchasing the natural gas commodity itself. NJNG does not profit
from the sale of the natural gas commodity, or BGSS, which is passed
through to customers.
As a part of its filing, NJNG is also seeking permission for a Phase II
proceeding to request rate recovery for the Southern Reliability Link
(SRL) upon completion of the project. Approved by the BPU in 2016, the
SRL is a 30-mile transmission pipeline project that will provide a new
natural gas feed into Ocean County and significantly enhance the
reliability and resiliency of NJNG’s delivery system. Construction of
the project is underway; however, its anticipated 2020 in-service date
falls outside the established period for inclusion for this filing. The
company currently estimates an increase of approximately $28.6 million
in the Phase II base rate adjustment associated with the completion of
the SRL, which would add an additional $4.58 to the typical heating
customers monthly bill.
Under normal conditions, the BPU’s review of NJNG rate filing could take
between nine and 12 months.
In a separate filing with the BPU, NJNG submitted its annual recovery of
costs associated with its New Jersey Reinvestment in System Enhancement
and Safety Acceleration and Facility Enhancement II programs. If
approved, the typical residential heating customer using 100 therms a
month would see an increase of $1.35 on their monthly bill effective
October 1, 2019.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, Section 21E of
the Securities Exchange Act of 1934, as amended, and the Private
Securities Litigation Reform Act of 1995. NJR cautions readers that the
assumptions forming the basis for forward-looking statements include
many factors that are beyond NJR’s ability to control or estimate
precisely, such as estimates of future market conditions and the
behavior of other market participants. Words such as “anticipates,”
“estimates,” “expects,” “projects,” “may,” “will,” “intends,” “plans,”
“believes,” “should” and similar expressions may identify
forward-looking statements and such forward-looking statements are made
based upon management’s current expectations, assumptions and beliefs as
of this date concerning future developments and their potential effect
upon NJR. There can be no assurance that future developments will be in
accordance with management’s expectations, assumptions and beliefs or
that the effect of future developments on NJR will be those anticipated
by management. Forward-looking statements in this release include, but
are not limited to, certain statements regarding the base rate case,
future NJR capital expenditures and infrastructure investments and the
ability to construct the SRL.
The factors that could cause actual results to differ materially from
NJR’s expectations include, but are not limited to, risks associated
with our investments in clean energy projects, including the
availability of regulatory and tax incentives, the availability of
viable projects, our eligibility for ITCs, the future market for SRECs
and electricity prices, and operational risks related to projects in
service; the ability to obtain governmental and regulatory approvals,
land-use rights, electric grid connection (in the case of clean energy
projects) and/or financing for the construction, development and
operation of our unregulated energy investments, pipeline transportation
systems and NJNG and Midstream infrastructure projects, including NJ
RISE, SRL, PennEast and Adelphia Gateway, in a timely manner; risks
associated with acquisitions and the related integration of acquired
assets with our current operations, including our planned Adelphia
Gateway acquisition; volatility of natural gas and other commodity
prices and their impact on NJNG customer usage, NJNG’s BGSS incentive
programs, our Energy Services segment operations and our risk management
efforts; the ability to comply with current and future regulatory
requirements; the level and rate at which NJNG’s costs and expenses are
incurred and the extent to which they are approved for recovery from
customers through the regulatory process, including through future base
rate case filings; the impact of a disallowance of recovery of
environmental-related expenditures and other regulatory changes; the
performance of our subsidiaries; operating risks incidental to handling,
storing, transporting and providing customers with natural gas; access
to adequate supplies of natural gas and dependence on third-party
storage and transportation facilities for natural gas supply; the
regulatory and pricing policies of federal and state regulatory
agencies; timing of qualifying for ITCs due to delays or failures to
complete planned solar projects and the resulting effect on our
effective tax rate and earnings; the results of legal or administrative
proceedings with respect to claims, rates, environmental issues, natural
gas cost prudence reviews and other matters; changes in rating agency
requirements and/or credit ratings and their effect on availability and
cost of capital to our company; risks related to cyberattack or failure
of information technology systems; the impact of volatility in the
equity and credit markets on our access to capital; the impact to the
asset values and resulting higher costs and funding obligations of our
pension and post-employment benefit plans as a result of potential
downturns in the financial markets, lower discount rates, revised
actuarial assumptions or impacts associated with the Patient Protection
and Affordable Care Act; commercial and wholesale credit risks,
including the availability of creditworthy customers and counterparties,
and liquidity in the wholesale energy trading market; accounting effects
and other risks associated with hedging activities and use of
derivatives contracts; the ability to optimize our physical assets;
weather and economic conditions; changes to tax laws and regulations;
any potential need to record a valuation allowance for our deferred tax
assets; the ability to comply with debt covenants; demographic changes
in NJR’s service territory and their effect on NJR’s customer growth;
the impact of natural disasters, terrorist activities and other extreme
events on our operations and customers; the costs of compliance with
present and future environmental laws, including potential climate
change-related legislation; environmental-related and other
uncertainties related to litigation or administrative proceedings; risks
related to our employee workforce; and risks associated with the
management of our joint ventures and partnerships, and investment in a
master limited partnership. The aforementioned factors are detailed in
the “Risk Factors” sections of our Form 10-K that we filed with the
Securities and Exchange Commission (SEC) on November 20, 2018, which is
available on the SEC’s Web site at sec.gov. Information included in this
release is representative as of today only, and while NJR periodically
reassesses material trends and uncertainties affecting NJR’s results of
operations and financial condition in connection with its preparation of
management’s discussion and analysis of results of operations and
financial condition contained in its Quarterly and Annual Reports filed
with the SEC, NJR does not, by including this statement, assume any
obligation to review or revise any particular forward-looking statement
referenced herein in light of future events.
About New Jersey Resources
New Jersey Resources (NYSE: NJR) is a Fortune 1000 company that
provides safe and reliable natural gas and renewable energy services,
including transportation, distribution, asset management and home
services. NJR is composed of five primary businesses:
- New Jersey Natural Gas, NJR’s principal subsidiary,operates
and maintains over 7,400 miles of natural gas transportation and
distribution infrastructure to serve more than half a million
customers in New Jersey’s Monmouth, Ocean, Morris, Middlesex and
Burlington counties.
- NJR Clean Energy Ventures is a leading renewable energy company
that invests in, owns and operates residential and commercial solar
projects with a total capacity in excess of 250 megawatts, providing
residential and commercial customers with low carbon solutions.
- NJR Energy Services manages a diversified portfolio of natural
gas transportation and storage assets and provides customized energy
solutions to its customers across North America.
- NJR Midstream serves customers from local distributors and
producers to electric generators and wholesale marketers through its
50 percent equity ownership in the Steckman Ridge natural gas storage
facility, as well as its 20 percent equity interest in the PennEast
Pipeline Project.
- NJR Home Services provides service contracts, as well as
heating, central air conditioning, water heaters, standby generators,
solar and other indoor and outdoor comfort products to residential
homes and businesses throughout New Jersey.
NJR and its more than 1,000 employees are committed to helping customers
save energy and money by promoting conservation and encouraging
efficiency through Conserve to Preserve® and initiatives such
as The SAVEGREEN Project® and The Sunlight Advantage®.
For more information about NJR:
Visit: www.njresources.com
Follow
us on Twitter @NJNaturalGas.
“Like” us at
facebook.com/NewJerseyNaturalGas.
Download our free NJR investor
relations app for iPad.
View source version on businesswire.com: https://www.businesswire.com/news/home/20190329005438/en/
Source: New Jersey Resources
Investors:
Dennis Puma
732-938-1229
dpuma@njresources.com
Media:
Michael Kinney
732-938-1031
mkinney@njresources.com