South Jersey Gas Files to Reduce Rates by 4.3%

South Jersey Gas today proposed a rate reduction that would save residential customers on average 4.3 percent on their natural gas bills.

SJG has filed petitions with the New Jersey Board of Public Utilities that will lead to an overall decrease of $5.94 on a 100-therm monthly natural gas bill. This decrease follows a 10.6 percent rate reduction granted to SJG in 2010 and is in addition to a $22.7 million Basic Gas Supply Service bill credit issued to customers in March 2011. When coupling this proposed rate reduction with the March bill credit, SJG’s residential customers will see a total 10.4 percent decrease in rates this year.

"With wholesale gas prices trending lower in recent years, we’re pleased to offer this overall rate reduction to our customers, while at the same time improving the quality of service we provide and enhancing overall system safety and reliability,” said Edward J. Graham, South Jersey Gas president and CEO.

The four components of the filing that led to the rate reduction include:

• The Basic Gas Supply Service petition, which proposes a rate decrease of $3.94, or 2.9 percent. The BGSS clause serves as a method to pass along increases and decreases in gas costs directly to customers without affecting SJG’s income.
• The Conservation Incentive Program petition, which proposes a rate decrease of $3.46, or 2.5 percent. The CIP program encourages customers to use natural gas more efficiently and reduce consumption. It also benefits investors by eliminating the link between the company’s profits and the quantity of natural gas it sells. Since the CIP was instituted in 2006, SJG’s customers have reduced their natural gas use by 19.1 billion cubic feet - enough gas to heat 54,000 homes - and they have saved $219 million in energy costs.
• The Energy Efficiency Tracker petition, which proposes a rate increase of $0.72, or 0.5 percent. SJG seeks the continuation of its five energy efficiency programs during the next 10 months, bringing the total amount spent on these programs to $17.1 million.
• The Capital Investment Recovery Tracker, which proposes a rate increase of $0.74, or 0.5 percent. The CIRT accelerates a number of infrastructure improvement projects designed to enhance the safety, reliability and capacity of SJG’s natural gas delivery system. The initial CIRT went into effect in 2009 and led to more than $100 million in enhancements to SJG’s system. In March 2011, the NJBPU approved an extension to the CIRT which added another $60.3 million to complete additional projects by the end of October 2012.

"The impact of this rate reduction for a homeowner switching to natural gas service from oil or propane would be significant,” said Graham. "Based on regional pricing, a customer would see almost 60 percent annual savings over oil and almost 70 percent over propane. Summer is the best time to switch to natural gas so installation can be completed prior to the winter heating season.”

South Jersey Gas, subsidiary of energy services holding company South Jersey Industries (NYSE:SJI), provides natural gas service to more than 349,000 residential, commercial and industrial customers in Atlantic, Cape May, Cumberland, Salem, and significant portions of Gloucester, Burlington and Camden counties in New Jersey. Visit http://www.southjerseygas.com to learn more about South Jersey Gas and its programs.