New Jersey Natural Gas, a regulated subsidiary of New Jersey Resources, submitted a filing to the New Jersey Board of Public Utilities (BPU) to pass through the benefits of the recently enacted federal tax reform to customers. NJNG announced it will reduce customers’ rates by $21 million, effective April 1, 2018, resulting in a $31, or 3 percent, decrease to a typical residential heating customer’s annual bill.
New Jersey Natural Gas also announced it will provide a one-time refund to customers totaling approximately $31 million. The estimated refund for a typical residential heat customer is $47. The actual refund amounts will be determined in May and reflect individual customer usage. Pending BPU approval, customers can expect to see these savings in their May or June bills.
For the rate decrease, a typical residential heating customer using 1,000 therms a year will see their annual bill go from $1,054 to $1,023, a savings of $31. When combined with the one-time refund, the customer will see an overall reduction of $78 or 7.4 percent this year. This adjustment will help ensure rates reflect the lower tax structure and any appropriate savings are passed on to customers.
“Our top priority is to ensure we deliver safe, reliable and affordable service to our customers,” said Laurence M. Downes, chairman and CEO of New Jersey Resources. “We are pleased to pass along the benefits of tax reform to our customers through lower energy bills.”
On December 22, 2017, the Tax Cuts and Jobs Act of 2017 was signed into law and went into effect Jan. 1. The Act sets forth changes to the Federal Internal Revenue Tax Code and reduces the corporate tax rate from 35 percent to 21 percent. These changes could result in an over-collection of tax revenue by public utilities. To ensure ratepayers receive the appropriate benefit of the lower tax rate, the BPU issued a Jan. 31 Order directing New Jersey’s public utilities to submit a filing responsive to the effects of the Act.
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