JCP&L Under Review for Nearly $86 Million in Overearnings from 2010

It's never a good feeling being told you've been swindled, "had", used, and lied to by a company. And perhaps that isn't even being told to Jersey Central Power and Light customers just yet-as JCP&L is under investigation for nearly $86 million in overearnings during 2010. This may even reach into other years, but as of right now 2010 is the only year that has been researched or under further investigation.

Where the Allegations Arose

According to Stefanie Brand, director of the state's Division of Rate Counsel, JCP&L has earned far more than they should have in 2010 by upwards of $86 million- a high number that has authorities and customers concerned. Unfortunately, this case could get worse as Brand has only made allegations and accusations regarding 2010, but there is possibility that this infraction very well could have occurred in other years prior. Though there is no evidence to prove either way, some customers must feel the need to have this sorted out.

The Evidence

As the saying goes, "hindsight is 20/20," and many are looking into this and thinking that the signs were all there. Brand and her affiliates have indicated several notable cues that should have caused alerts, but at least now are being noted in the case against the JCP&L.

Brand and her affiliates noted that the JCP&L had not sought an increase in rate of return from their services making for a lack in transparency as Brand notes that the JCP&L didn't ask for any rate increases and yet their expenses may have decreases meaning they received more return. Something that needs to be identified and communicated to the BPU and/or the state's Division of Rate Counsel.

Could this have been an oversight?

The Final Straw

Brand may have been willing to see this as a harmless act of error or oversight, but there's more that has led to the accusations. Unfortunately, the utility was falling behind others when trying to help its customers regain their electricity after Hurricane Irene and actually "underscored" findings.  Thus, a consultant examined the case, Robert Henkes.

"My review indicates that JCP&L's actual 2010 return on rate base for its total electric operations amounts to 12.37 percent, which is substantially in excess of JCP&L's adjusted BPU-authorized return on rate base of 8.75 percent," said Henkes.

In addition, Henkes found that the rates were unreasonable in comparison to other company's rates and BPU-authorizations.

Despite the harsh numbers and findings, JCP&L is denying the claims and says that their rates are reasonable and there isn't reason for them to file a rate change, but they will comply if asked.