AARP Calls on Board of Public Utilities to Reject PSE&G's Flawed Multi-Billion Dollar Upgrade Plan

 

PRINCETON- Today, AARP, a party in the so-called “Energy Strong” proceeding, filed its initial brief with the New Jersey Board of Public Utilities, urging the Board to reject PSE&G’s mammoth Energy Strong proposal as filed, a multi-billion proposal which is high on cost, yet light on actual, tangible benefits for PSE&G customers.

“PSE&G, quite simply, did not carry its burden for this unusual and extraordinarily expensive proposal,” according to Jim Dieterle, AARP New Jersey State Director. “No one can argue that we need to make our systems stronger. But it would be a multi-billion dollar mistake to spend billions on a ‘hardening’ proposal that will ultimately address so few of the problems that actually caused people to lose power during Superstorm Sandy.”

AARP expert witness Barbara Alexander testified extensively during evidentiary hearings on the critical defects of the Petition. These include:

• PSE&G’s failure to include any enforceable performance standards or measurements to assure the promised reliability improvements.
• PSE&G’s proposal to shift risks entirely to ratepayers as to whether the Energy Strong investments will perform as projected or ameliorate customer outage duration or frequency as predicted. The bill impacts are very high and the defects identified above make these higher rates questionable, particularly for lower income consumers.
• PSEG&’s failure to provide any analysis or evaluation that justifies how or why its proposed investment, taken as a whole, would be appropriate or needed. There is no evidence that PSE&G took a “bottoms up” approach to create the list of projects included in Energy Strong or that alternatives were considered and rejected in favor of the list of expensive projects they are proposing.
• The proposed investments are not designed to provide improved performance to most customers even during major storms. The Company’s own analysis shows that 100 million customer hours of interruption would occur even with these investments under an event similar to Superstorm Sandy.

 

In today’s filing, AARP urged New Jersey to follow the example of Florida in developing and approving storm mitigation efforts and which has done so without tacking new surcharges on customer bills.  Florida’s efforts, which came on the heels of a series of devastating hurricanes, the state’s Public Service Commission achieved consensus from a broad array of stakeholders on resiliency and reliability objectives, performance metrics, costs and benefits to the consumers and the utilities, and an appropriate level of expenditures. Once approved, Florida Power and Light implemented these plans without a special surcharge.

“This is not simply an issue of cost, it’s also an issue of cost-effectiveness,” says Dave Mollen, AARP New Jersey State President. “AARP absolutely agrees that we need to ensure that we have the infrastructure we need to withstand the storms that mother nature can throw at us. But PSE&G itself has said its proposal is discretionary, and the Company has NOT demonstrated that it’s proposed Energy Strong program will address the problems, including tree trimming and removal, that actually caused the majority of outages during and following Sandy. Despite costing ratepayers billions, these investments would still leave a large majority of those who lost power following that storm powerless if and when severe weather strikes again.” He adds, “It’s not about whether an investment should be made. It’s about making the right investment, and actually solving the problems that exist. This doesn’t get it done, and it’s not even close.”