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Our view: Electric costs edging up, but temporary jumps probably due to pandemic

Our view: Electric costs edging up, but temporary jumps probably due to pandemic

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The clean energy policies of New Jersey continue to add incrementally to the utility bills of residents and businesses. One of the increases already in the pipeline started to get some definition recently with state approval of an energy efficiency initiative by its largest utility.

Since Atlantic City Electric and the other utilities also have submitted energy efficiency proposals, the Board of Public Utilities approval of PSEG’s plan signals the approach it will take to theirs.

Public Service Electric & Gas had sought to spend $2.5 billion over six years to get its customers to use less electricity and natural gas. The BPU cut that down to $970 million and three years.

That’s still a lot of money, with $284 million of it to be spent on residential customers and $686 million on businesses. It will encourage and subsidize upgraded thermostats, LED lighting and efficient appliances, with programs specifically aimed at low-income residents, multi-family dwellings, small businesses, local government and nonprofits.

The cost to PSEG residential customers is forecast at $1.27 a month on combined gas and electric bills by 2025 — another trickle in the stream and maybe river of clean energy costs headed for consumers.

Atlantic City Electric’s energy efficiency proposal was more modest from the start, so perhaps the BPU will pare it down less. ACE wants to spend an additional $99 million over three years on such things as energy use assessments, incentives for efficiency upgrades and rebates on efficient products. It estimates a typical residential customer will pay another 30 cents a month in the first year.

Late summer and heading into fall many New Jersey residents have seen surprising increases in their electric bills, but these aren’t from the clean energy costs they may be dreading. Blame the pandemic and the reaction to it for them too.

From March through summer Gov. Murphy barred utility workers from entering dwellings, so those with meters indoors got estimated readings instead of actual usage.

At the same time, power usage increased as people spent more time at home and often worked from there. Instead of turning down the air conditioning and shutting everything off for the day while adults worked and kids were in school, they kept it cool and with TVs, computers, lights and all running. A Columbia University study early in the New York lockdown found weekday energy usage increased 7% and midday usage by 23%. Atlantic City Electric said hotter summer weather was also a factor.

Now that meters have been read, bills are catching up with what people actually used and they’re complaining. The BPU in one month has received 26 complaints from ACE customers, 229 from those with PSEG and 36 from JCP&L.

These increases will go away after bills are adjusted for usage estimates (if any) and work and school return to normal (hopefully soon).

There are, of course, more clean energy bills coming due soon. The utilities also have proposals before the BPU to pay for electric-vehicle infrastructure, giant battery facilities and smart meters. After that will be the cost of the massive development of offshore wind energy. Clean energy technology is expensive, and much depends on how much the technology improves over the next decade.

The worry of consumers and businesses, shared by the BPU, is that adding up these cost streams might be enough to drown New Jersey residents and companies. By keeping an eye on what their peers in other states are paying, they’ll be in a better position to decide whether New Jersey’s choice of energy policy is worth it.

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