PSE&G seeks approval of Clean Energy Future program in New Jersey

Public Service Enterprise Group’s (NYSE:PEG) (PSEG) Public Service Electric and Gas (PSE&G) on Sept. 27 said that it has proposed a Clean Energy Future (CEF) program with the New Jersey Board of Public Utilities (BPU) that includes energy efficiency, electric vehicle (EV) charging, energy storage (ES), and the Energy Cloud designed to improve services, save customers money, and support the state’s clean energy goals.

According to the Sept. 26 petition filed with the BPU, the company seeks BPU approval for three programs that “form the basis for a clean and resilient energy future”:

  • The CEF – Energy Efficiency Program (CEF-EE Program), which would expand PSE&G’s energy efficiency deployment in its service territory beyond current levels in order for the state meet its clean energy objectives
  • The CEF – Electric Vehicle and Energy Storage Program (CEF-EVES Program), which jumpstart the EV industry and ES technology in New Jersey in order for the state to meet its clean transportation and clean energy objectives
  • The CEF – Energy Cloud Program (CEF-EC Program), the foundation of which is the deployment of advanced metering infrastructure (AMI) throughout the company’s electric service territory, which will be the technological platform that strengthens and modernizes the electric grid and the PSE&G customer experience

The company added that those three programs in the aggregate will form a clean energy future for New Jersey that furthers the state’s goals by, for instance, lowering energy consumption and customer bills, reducing greenhouse gas emissions, and launching the EV industry and ES technology in New Jersey.

CEF-EE Program

Further discussing the CEF-EE Program, the company said that the program consists of 22 subprograms, including seven residential subprograms, seven commercial and industrial (C&I) subprograms, and eight pilot subprograms. The company noted that the various pilot subprograms consist of PSE&G implementing and managing select, highly advanced approaches to energy efficiency that after the pilot phase may support future energy efficiency programs in New Jersey. Customers in PSE&G’s electric and/or gas service territory who meet the criteria for the respective CEF-EE subprogram offerings would be eligible to participate in them, the company said, adding that the CEF-EE Program has an emphasis on the hardest-to-reach sectors: low-income, multi-family, small business, and local government.

A summary of the CEF-EE subprograms noted that the “Residential K-12 Education” subprogram, for instance, involves a curriculum to teach energy efficiency and a take-home kit with efficient products.

Regarding reducing energy consumption and lowering customers’ bills, in total, the proposed CEF-EE Program is expected to reduce energy consumption by about 40.6 billion kWh and 675 million therms, resulting in a net reduction in participating customers’ energy bills by $5.7bn over the life of energy efficiency measures, PSE&G said. Once fully implemented, the CEF-EE Program would produce electric savings as a percentage of retail sales in PSE&G’s service territory of about 1.8% per year, and 6.6% cumulatively by 2025, the company said, adding that gas savings as a percentage of retail sales in PSE&G’s service territory would reach 0.8% annually, resulting in a cumulative total reduction of 2% by 2025.

PSE&G said that it proposes to commit up to $2.5bn in CEF-EE Program investment, and proposes a $283m expense budget over the six-year term of the program; the six-year period would begin upon BPU approval of the CEF-EE Program. Cost recovery would be made and tracked via a new CEF-EE Program component of the company’s electric and gas Green Programs Recovery Charge, which would be filed annually after the proposed initial period.

PSE&G said that its typical residential electric customers using 750 kWh in a summer month and 7,200 kWh annually would experience an initial increase in their annual bill of $4, from $1,233.72 to $1,237.72, or about 0.32%. The company said that the expected maximum increase of $43.20, or about $3.5%, is projected to occur in the period from October 2029 to September 2030, based on rates in effect Sept. 8, 2018.

PSE&G noted that its typical residential gas heating customers using 165 therms in a winter month and 1,010 therms annually would experience an initial increase in their annual bill of 42 cents from $879.22 to $879.64, or about 0.05%. The expected maximum increase of $20.04, or about 2.28%, would occur in the period from October 2031 to September 2032, based on rates in effect Sept. 8, 2018, the company said.

CEF-EVES Program

Of the CEF-EVES Program, PSE&G said that that it proposes to commit up to $261m of investment over a period of about six years, and projects about $103m in expenses for four EV subprograms to commence upon BPU approval. A summary of the four EV subprograms noted that the $45m “Vehicle Innovation” subprogram, for instance, involves incentives for electric school buses and charging equipment, as well as an open solicitation for customized electrification projects.

The company also said that it proposes to commit up to $109m of investment in five ES subprograms over a period of about six years, and projects about $70m in expenses. A summary of the five ES subprograms noted that the $25.7m “Microgrids for Critical Facilities” subprogram, for instance, involves providing capital to support the development of microgrids.

Overall, the company added, the ES subprograms would install 35 MW of ES capacity across the PSE&G distribution system over six years. The CEF-EVES Program is proposed to be recovered as separate components of the Technology Innovation Charge (TIC), a new charge to the company’s Tariff for Electric Service. PSE&G added that the two TIC components are the CEF-EV component and the CEF-ES component.

With respect to rate impacts associated with the EV subprograms, PSE&G said that its typical residential customers using 750 kWh in a summer month and 7,200 kWh annually would experience an initial increase in their annual bill from $1,233.72 to $1,234.92, or $1.20, or about 0.10%, or an average of about 10 cents per month, with the expected maximum increase in the period from Oct. 1, 2024 through Sept. 30, 2025 of about $7.72, or 0.63%, or about 64 cents per month from rates in effect Sept. 8, 2018.

With respect to rate impacts associated with the ES subprograms, PSE&G said that its typical electric residential customers using 750 kWh in a summer month and 7,200 kWh annually would experience an initial increase in their annual bill from $1,233.72 to $1,233.84, or 12 cents, or about 0.01%, or an average of about 1 cent per month, with the expected maximum increase in the period from Oct. 1, 2025 through Sept. 30, 2026 of about $3, or 0.24%, or about 25 cents per month from rates in effect Sept. 8, 2018.

Regarding the combined rate impacts from the CEF-EVES components of the TIC, PSE&G said that its typical residential customers using 750 kWh in a summer month and 7,200 kWh annually would experience an initial increase in their annual bill from $1,233.72 to $1,234.96 or $1.24, or about 0.10%, or an average of about 12 cents per month, with the expected maximum increase in the period from Oct. 1, 2025 through Sept. 30, 2026 of about $10.60, or 0.86%, or about 88 cents per month from rates in effect Sept. 8, 2018.

CEF-EC Program

Of the CEF-EC Program, PSE&G said that it anticipates that the program would be deployed over a five-year period – 2019-2024 – subject to BPU approval. The program proposes estimated investment of about $721m and operations and maintenance (O&M) costs of $73m from 2019 to 2024.

PSE&G added that the program in total would consist of 70 applications or “use cases.” The petition seeks BPU approval of the initial phase of the CEF-EC Program, referred to as “Release 1,” which features 22 of the 70 use cases. Those 22 use cases, PSE&G added, focus on customer engagement, network operations and planning, as well as new utility products and services. Release 1 would establish the foundation for the CEF-EC Program, including the platform that is comprised of advanced electric meters, as well as communications and back-office systems, the company said.

A summary of the 22 use cases that are part of Release 1 noted that the “Customer Power Quality” use case, for instance, would allow PSE&G to obtain voltage, load, and alert data directly from the meter to analyze customer power quality issues.

PSE&G also said that it would install about 2.2 million advanced, or smart, meters throughout its electric service territory over the course of a five-year period, beginning in 2019.

The company said that it proposes that residential customers seeking to opt out of an advanced meter pay a $20 monthly fee for meter reading services. Residential customers seeking to replace an installed AMI meter with a non-AMI meter would be assessed a one-time fee of $45, the company said, adding that commercial and industrial customers would not be permitted to opt out of an AMI meter.

Among other things, PSE&G said that the cost recovery method would involve the potential of semi-annual base rate adjustment filings.

About Corina Rivera-Linares 3052 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.