A4718

An Act requiring a study on public utility de-privatization and making an appropriation.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. As used in this section:

“Board” means the Board of Public Utilities.

“Clean energy program” means a program administered by a public entity, which program incentivizes or otherwise promotes increased energy efficiency and the use of clean, renewable sources of energy, which sources shall include, but shall not be limited to, solar, wind, geothermal, and sustainable biomass.

“Public entity” means any of the principal departments in the Executive Branch of the State government, and any division, board, bureau, office, commission, or other instrumentality within or created by such department or by any political subdivision.

“Public utility” means the same as that term is defined in R.S.48:2-13.

“Third party” means an entity without an ownership or financial relationship with either a public utility or a public entity.

b. The board shall engage a third party to conduct a study on the feasibility of and cost savings associated with the de-privatization of public utilities in this State and shall direct the third party to conduct such analysis as the board shall deem appropriate for purposes of the study. The third party engaged by the board shall have the authority to request information and reasonable assistance from any public utility or public entity in order to conduct the study. The study conducted pursuant to this section shall examine the feasibility of and cost savings associated with de-privatization options, including, but not limited to:

(1) acquisition or operation of existing public utilities, in part or in whole, by a public entity; and

(2) joint ownership or operation of existing public utilities, in part or in whole, between a public entity and existing public utilities.

c. The study conducted pursuant to this section shall include, but not be limited to:

(1) the short- and long-term challenges and benefits of each option examined, including, but not limited to, any anticipated environmental effect, impact on service, and cost to ratepayers;

(2) the strengths and weaknesses of selecting each public entity considered for potential acquisition, ownership, or operation, in whole or in part, of public utilities, as well as potential organizational structures. Public entities to be considered shall include the board and any other appropriate public entity;

(3) an estimation of costs, including, but not limited to, financial costs, as well as long-term financial impact on the State and any public entity involved in each option;

(4) an estimation of the cost savings associated with each option examined;

(5) an estimation of the amount of revenue generated by clean energy programs; and

(6) any other analysis as the board shall direct the third party to conduct.

d. Any public utility or public entity shall promptly respond to, cooperate fully with, and provide any requested information to the third party engaged by the board pursuant to subsection b. of this section.

e. Within one year after the effective date of this act, the board shall submit a written report to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature summarizing the findings from the study and providing recommendations as to the feasibility of, need for, cost savings associated with, and plan for the de-privatization of public utilities in this State. The report shall include recommendations for legislative, executive, and other actions.

2. There is appropriated to the Board of Public Utilities a sum of $100,000 from the General Fund for the purpose of effectuating this act.

3. This act shall take effect immediately.

STATEMENT

This bill requires the Board of Public Utilities (board) to engage a third party to conduct a feasibility and cost savings study on the de-privatization of public utilities in this State. The third party is authorized to request information and reasonable assistance from any public utility or public entity in order to conduct the study, which is to examine the feasibility of and cost savings associated with de-privatization options, including, but not limited to: (1) acquisition or operation of existing public utilities, in part or in whole, by a public entity; and (2) joint ownership or operation of existing public utilities, in part or in whole, between a public entity and existing public utilities.

The study is to include: (1) the short- and long-term challenges and benefits of each option examined, including, but not limited to, any anticipated environmental effect, impact on service, and cost to ratepayers; (2) the strengths and weaknesses of selecting each public entity considered for potential acquisition, ownership, or operation, in whole or in part, of public utilities, as well as potential organizational structures; (3) an estimation of costs, including, but not limited to, financial costs, as well as long-term financial impact on the State and any public entity involved in each option; (4) an estimation of the cost savings associated with each option examined; (5) an estimation of the amount of revenue generated by clean energy programs; and (6) any other analysis as the board directs.

Any public utility or public entity is required to promptly respond to, cooperate fully with, and provide any requested information to the third party.

Within a year of the bill’s effective date, the board is required to submit a report to the Governor and the Legislature summarizing the findings from the study and providing recommendations as to the feasibility of, need for, cost savings associated with, and plan for the de-privatization of public utilities in this State. The report is to include recommendations for legislative, executive, and other actions.

The bill appropriates $100,000 from the General Fund to the board to implement the provisions of the bill.

With this legislation, the sponsor intends to encourage the State to explore opportunities to provide utility services as a public good for utility customers across New Jersey.