LEGISLATIVE FISCAL ESTIMATE

ASSEMBLY, No. 5465

STATE OF NEW JERSEY

221st LEGISLATURE

 

DATED: JULY 23, 2025

 

 

SUMMARY

 

Synopsis:

Requires electric public utilities to apply to BPU for certificate of public convenience and necessity prior to undertaking transmission project.

Type of Impact:

Annual increase in State expenditures and revenues. 

Agencies Affected:

Board of Public Utilities. 

 

Office of Legislative Services Estimate

Fiscal Impact

Annual

 

State Expenditure Increase

Indeterminate

 

State Revenue Increase

Indeterminate

 

 

 

 

·         The Office of Legislative Services (OLS) finds that this bill will result in an indeterminate increase in both State revenues and expenditures for the Board of Public Utilities to establish, administer, and award certificates of public convenience and necessity to electric public utilities prior to the utility initiating or modifying electrical transmission projects.

 

·         The board will experiences expenditure increases to administer the program, which includes reviewing applications, conducting possible hearings, and issuing determinations and certificates.

 

·         These expenditure increase will be offset to some degree by the collection of application fees by the board for certificates of public convenience and necessity.  The OLS is unable to quantify these increases because the number and complexity of transmission project applications submitted, the fee schedule that will be adopted by the board, and the internal administrative capacity of the board to manage the new regulatory process are all unknown.  

 

 

BILL DESCRIPTION

 

      This bill requires an electric public utility to submit an application to the Board of Public Utilities for a certificate of public convenience and necessity prior to undertaking a transmission project in New Jersey.  The application is required to include any information deemed necessary by the board and an application fee in an amount determined by the board.

      After receiving a completed application, the bill requires the board to issue a board order with its decision regarding the application, its authorization for the utility to construct the project, and a manner and timeframe in which the utility is to complete the project.  The board is to act on an application within 150 days and, in certain circumstances, is permitted to extend this 150-day deadline by an additional period not to exceed 75 days.  To make its determination, the board is required to consider whether: (1) the project is necessary to provide adequate, reliable, and efficient service to the utility’s customers and is the lowest cost means of satisfying the service needs of the utility’s customers or that the project will promote the development of an effectively competitive electricity market that operates efficiently, is equitable to all customers, and is the lowest cost means of satisfying those objectives; (2) the utility is capable of efficiently managing and supervising the construction process and has taken sufficient action to ensure adequate and efficient construction and supervision of the construction; and (3) the utility is capable of financing the proposed construction without significant adverse financial consequences for the utility or its customers.   

 

 

FISCAL ANALYSIS

 

EXECUTIVE BRANCH

 

      None received. 

 

OFFICE OF LEGISLATIVE SERVICES

 

      The OLS finds that this bill will result in an indeterminate increase in both State revenues and expenditures for the Board of Public Utilities to award certificates of public convenience and necessity to electric public utilities prior to the utility initiating or modifying electrical transmission projects within the State. 

      The board will experiences expenditure increases to administer the program which include reviewing applications, conducting possible hearings, and issuing determinations and certificates. 

      These expenditure increases will be offset to some degree by the collection of application fees by the board for certificates of public convenience and necessity.  The OLS is unable to quantify these increases because the number and complexity of transmission project applications submitted, the fee schedule that will be adopted by the board, and the internal administrative capacity of the board to manage the new regulatory process are all unknown.

 

 

Section:

Authorities, Utilities, Transportation and Communications

Analyst:

Michael D. Walker

Associate Fiscal Analyst

Approved:

Thomas Koenig

Legislative Budget and Finance Officer

 

 

This legislative fiscal estimate has been produced by the Office of Legislative Services due to the failure of the Executive Branch to respond to our request for a fiscal note.

 

This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).