NJ Spotlight: State Board Questions JCP&L Earnings
Concerns also raised that utility isn't investing enough in infrastructure.
In today's NJ Spotlight, Tom Johnson explores: Is Jersey Central Power & Light earning too much and investing too little in its distribution system?
The state Board of Public Utilities (BPU) has decided to initiate a proceeding to look into allegations that the state's second-largest utility is earning significantly more than what the agency has established as a reasonable return on its investments.
The proceeding was initiated based on a petition filed by the Division of Rate Counsel, which argued that Jersey Central Power & Light (JCP&L) is earning a 12.37 percent rate of return, far in excess of the 8.5 percent approved by the state.
As a result, JCP&L over-earned $86 million to $90 million in 2010, according to Robert Henkes, an energy consultant retained by the agency, who examined the company's financial data.
The new proceeding comes at a time when JCP&L, which serves 1 million electric customers in north and central New Jersey, has come under repeated criticism from the Christie administration, local officials and customers for its slow response in restoring power after Hurricane Irene and a rare late October snowstorm.
Those outages left hundreds of thousands of their customers without power, some for as long as nine days.
Read the full story in NJ Spotlight. NJ Spotlight is an online news service providing insight and information on issues critical to New Jersey.