JCP&L Ordered To Sit Before Board of Public Utilities
The electric company is accused of making $90 million more than it should have in 2010.
Several recent power outages may not be at the top of a long list of problems for Jersey Central Power and Light, the electric company that serves 236 New Jersey municipalities.
The State Division of Rate Counsel in Trenton called on Wednesday for an examination of the company's finances. The board is alleging JCP&L made around $90 million more than it should have in 2010, according to a Board of Public Utilities news release.
“Today’s action by the Board requires JCP&L to make a base rate filing which will allow the Board, Rate Counsel and other interested parties to evaluate whether the Company is providing safe, adequate and proper service at just and reasonable rates,” said N.J. BPU President Bob Hanna.
According to The Star Ledger, Stefanie Brand, who runs the rate counsel, requested that JCP&L sit before the BPU after the company's performance around the state during and after Hurricane Irene and and an October, 2011 snow storm.
Brand said last year that the state is not sure how long the high earnings have gone on, which is reason enough for the hearing, according to The Star Ledger.
The BPU pre-approves utility companies for a specific rate of return from its customers, usually set by the board after the company has requested an increase, such as the increase request currently before the BPU by Middlesex Water.
However, The Star Ledger reports that JCP&L hasn't been before the board for an increase in years.
Public ridicule from customers and officials across the state prompted Brand and the Rate Counsel to look closer at JCP&L's corporate structure and practices.
In March of this year, JCP&L announced it would spend $200 million for improvements across its coverage area, including the completion of several new substations, as well as a $2 million investment to upgrade more than 40 distribution circuits within JCP&L's New Jersey service area.
According to JCP&L President Donald Lynch, the utility company has invested more than $1.6 billion in capital improvements to its distribution network.
Despite what seems to be a higher volume of communication and infrastructure, the Board of Public Utilities and the Rate Counsel say the higher than normal earnings mean the company should be under the microscope.
"In the petition, Rate Counsel argues that, without a base rate case, JCP&L customers have not had the opportunity to review the company’s revenues and expenses to ensure that JCP&L is making the necessary capital improvements required to provide safe, adequate, and reliable utility service," a BPU news release said.
The BPU hearing has not yet been scheduled. JCP&L is owned nationally by parent company FirstEnergy.