NJ heating bills in line for double-digit increases after state OKs big rate hikes

NJ heating bills in line for double-digit increases after state OKs big rate hikes
NJ heating bills in line for double-digit increases after state OKs big rate hikes


After enduring months of rising prices from the gas pump to grocery checkouts, New Jerseyans could see their annual heating bills soar this fall and winter as inflation and global tensions drive up natural gas prices.

State regulators on Wednesday approved double-digit rate increases for four gas providers serving millions of customers in the state, with prices expected to rise by hundreds of dollars on an annualized basis for some people.

PSEG, which serves 1.9 million people across the state, was granted a nearly 25% increase, which would amount to a $256.38 a year hike to the “typical” residential bill, according to the state Board of Public Utilities. BPU commissioners also approved a 15.8%, $258.72 annual increase for New Jersey Natural Gas and its 568,000 ratepayers.

“World events and increased demand have led to significant volatility in the natural gas commodity markets, putting upward pressure on the supply chain,” according to a statement provided by Lauren Ugorji, a spokesperson for PSEG. The utility’s service area stretches across 15 counties, from Bergen and Passaic in the north to Burlington and Gloucester in South Jersey.

The BPU approved even higher rate requests for South Jersey Industries and Elizabethtown Gas, which serve a combined 700,000 customers and will each raise rates by more than $300 annually. The new charges go into effect on Oct. 1.

An undated file photo of the PSE&G logo.

“Gasoline prices are going down; natural gas prices, unfortunately, are not,” said Brian Lipman, director of the New Jersey Rate Counsel, a state-appointed advocate for consumers.

New Jersey Natural Gas said in an email that its hands were forced by rising costs. Wholesale prices the utility pays for its fuel more than doubled in the year ending in May, when the company submitted its rate proposal, according to spokesperson Kevin Roberts. The company passes those expenses through to customers and “does not profit when natural gas commodity costs increase,” he said.

“No one wants prices to go up, which is why NJNG works year-round to manage our natural gas supply portfolio to help mitigate the impact of increases,” Roberts said. “We continue to monitor market conditions and will look for opportunities to lower costs and pass the benefits on to our customers.”

Gas prices at 14-year high

Wholesale natural gas prices for September delivery reached a 14-year high last month, squeezed by a European energy crisis brought on by the Ukraine conflict as well as high demand for air conditioning in the U.S.

“Unfortunately, higher gas prices will be coming for the American consumers,” Eugene Kim, a research director with energy consultancy Wood Mackenzie, told USA TODAY in August. “When we need to turn on our heaters, that’s when we’ll start to see some material increases in our gas bills.”

The pain may not be over in New Jersey. Utility companies have the right to implement two more increases of 5% over the winter, Lipman warned, on top of Wednesday’s hikes.

The latest U.S inflation report showed home heating prices rose more than 25% in July over the same period a year earlier, even as gasoline prices have inched downward from record-setting levels in the spring.

More:NJ Natural Gas to offer help on lowering energy bills at Morris County ‘Assistance Days’

On its website, the BPU laid out the impact for a “typical” customer in each service area:

  • New Jersey Natural Gas: $21.56 a month, or $258.72 a year, or 15.8%
  • PSEG: Yearly increase of $256.38, or 24.48%
  • Elizabethtown Gas: $25.33 a month, or $303.96 a year, or 22.9%
  • South Jersey Gas Company: $31.49 a month or 18.6%, or $377.88 a year

Lipman said that the Rate Counsel’s office would strive to ensure the companies weren’t making a profit off the backs of customers, something which elected officials and public advocates have accused oil companies of over the past six months.

“That’s a big part of what we’re concerned about – to make sure what they’re earning is right,” he said. “If these utility companies end up overcharging, then the extra money needs to be credited back to customers.”

Energy-saving tips

Higher gas prices “will just add to the burden of rising overhead costs” in the state, Tom Bracken, president of the New Jersey Chamber of Commerce, said in an email. Businesses will likely respond by looking to slash expenses and pass on rising costs to customers, he said in an email.

There are four state-run programs that help lower-income New Jerseyans pay their utility bills – some of which are run by the nonprofit NJ SHARES.

New Jersey’s Department of Community Affairs and Board of Public Utilities both have information online on how to apply, but eligibility is limited by income levels.

The state’s Low Income Home Energy Assistance Program and Universal Service Fund help low-income residents with heating and cooling bills, emergency repairs and emergency fuel assistance.

New Jersey is also still using federal coronavirus relief funds through the American Rescue Plan to help people cover the costs of missed utility payments, but that support is set to end on Sept. 30. The state runs an online tool that lets customers determine their eligibility.

“People who are living paycheck to paycheck really need to take a close look at what’s available there,” Lipman said Thursday by telephone. “There are a number of programs – assistance programs – and quite frankly ways to make payment plans with the utility.”

PSEG, like the other utilities, also offers home energy-saving tips on its website. For example, the company says customers can use ceiling fans to circulate warm air. It also recommends removing window air conditioners during the cold months and replacing old, drafty windows.

Fireplaces should be closed when not in use, PSEG advises. Customers are urged to lower their thermostats by about 2 degrees while at home, and five to 10 degrees when not at home.

Daniel Munoz covers business, consumer affairs, labor and the economy for and The Record. 

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