Power Grid Upgrade for PSEG
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After Sandy hit, a good portion of the East Coast was left without power. On Long Island and in New Jersey those outages left millions without heat, leaving residents at risk of hypothermia and carbon monoxide poisoning (due to the improper use of generators). The resultant super storms of climate change have forced gas and electric companies to upgrade their infrastructure in an effort to provide better service to their clients.

Public Service Electric and Gas (PSEG) has reached a tentative settlement with the New Jersey Board of Public Utilities (BPU) to spend 1.2 billion dollars to improve its infrastructure, which is a bit more than the $1 billion program that the BPU hoped for. But the widely contested plan may soon be green-lit according to Tom Johnson, a reporter for NJ Spotlight. Details are still in the works but people familiar with the settlement believe an agreement could be reached in the next few days.

If the proposal is agreed upon it will show how desperate the state is to prevent the power outages that many New Jersey residents experienced during Hurricane Sandy, despite the effect that the upgrade will have on residents’ utility bills. PSEG contends that the project investments will have a marginal impact on customer rates, but others aren’t so sure.

The New Jersey Rate Counsel believes the PSEG’s infrastructure upgrades will increase distribution rates by up to 20% for electric customers and 16.5% for gas customers. Stefanie Brand, director of the Counsel, stated that, “While the record does show an interest (by PSEG) on everyone’s part to improve resiliency, the record also shows that PSEG has not put together a program that will reasonably meet that goal.”

Public Service Electric and Gas does not intend to increase utility bills to the extent described by the rate counsel.  The company does understand that their upgrades will likely cost their customers, but the improvements will pay for themselves in a few years.

“It comes down to this: you can pay to keep the lights on in advance or you pay to fix them after they’ve gone out, “ said Kathleen Fitzgerald, vice president of PSEG, “We think doing it in advance makes more sense.”

Regardless of the dollar amount, the company will eventually be improving their infrastructure (that much seems certain). When the deal comes to fruition, power transfer stations will need to be flood proofed, gas lines will have to be replaced and laid, and computerized equipment will have to be installed, which should open the door for contractors to help ready the area for the next big storm.