State of New Jersey Civil Service Commission

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Rate Counsel | Learn About the Division

ABOUT THE
NEW JERSEY DIVISION
OF RATE COUNSEL

WHAT IS THE DIVISION OF RATE COUNSEL?

The New Jersey Division of Rate Counsel is an independent state agency in but not of the NJ Department of Treasury. Formerly the Division of the Ratepayer Advocate within the now-defunct Department of the Public Advocate, the Division represents the interests of consumers of electric, natural gas, water/sewer, telecommunications, cable TV service, and insurance (residential, small business, commercial and industrial customers).

Rate Counsel is a member of several state utility policy making groups and also represents consumers in setting energy, water and telecommunications policy that will affect the provision of services into the future. The New Jersey Legislature charged Rate Counsel with being “devoted to the maximum extent possible to ensuring adequate representation of the interest of those consumers whose interest would otherwise be inadequately represented in matters within the jurisdiction of the Division of Rate Counsel.”

The mission of Rate Counsel is to serve as an independent advocate and make sure that all classes of utility consumers receive safe, adequate and proper utility service at affordable rates that are just and nondiscriminatory. In addition, Rate Counsel works to ensure that all consumers are knowledgeable about the choices they have with utility competition. In January 2006, the Division began representing consumers in certain insurance cases.

HOW DOES RATE COUNSEL REPRESENT RATEPAYERS?

A utility cannot increase its rates -- the charge to consumers for use of utility services -- until the New Jersey Board of Public Utilities ("BPU") approves the change.  The BPU must also approve requests by utilities to add or change programs or services. To obtain BPU approval, the utility must "prove" that such a change is merited. The utility files its application with the BPU to demonstrate that an increase or change is justified.

Rate Counsel is a party to every proceeding before the BPU in which utilities seek to alter their rates or services. In each case, Rate Counsel thoroughly investigates all aspects of the company's request, and creates the evidentiary record upon which the BPU and its Staff will analyze and decide the case.

The investigation is based on detailed information that the utility provides regarding its request for changes in service or rate increases. Rate Counsel's attorneys, along with consulting economists, accountants, engineers and financial experts, analyze that information and develop independent conclusions regarding the reasonableness of the utility's request, and prepare and file testimony that supports those conclusions and advocates for the ratepayers' interests. Later, as a party to evidentiary hearings, Rate Counsel cross-examines the utility's witnesses and submits evidence to support the Division's position. Subsequently, if necessary, Rate Counsel will seek a better outcome for ratepayers, by an appeal in the appropriate state or federal court.

DOES RATE COUNSEL NEGOTIATE WITH UTILITIES TO AVOID THE EXPENSES OF LITIGATION?

Good consumer advocates must be ready to litigate to protect consumers' interests. However, litigation is expensive, and, in the case of utility litigation, a part of the expense may be passed on by utilities to consumers. To avoid the expense of litigation whenever it is in the best interest of ratepayers, Rate Counsel negotiates with utilities and attempts to settle as many issues as possible without or before going to a contested hearing.

HOW ELSE DOES RATE COUNSEL WORK FOR RATEPAYERS?

Rate Counsel plays an active role in policy making at the state and federal level. As an independent voice for the consumer, the Division is active in a number of policy-setting groups such as the Clean Energy Council and the state’s Energy Master Plan working group.

Additionally, the Division provides input to policy makers at the BPU and other agencies and the New Jersey State Legislature to develop long-term energy, water and telecommunications policy and goals that affect all New Jersey ratepayers. By assuring that the consumer's voice is heard at the outset of the ratemaking and policymaking processes, Rate Counsel promotes the development of consensus and spares the State and its residents the expense and inefficiency of unnecessary litigation.

DOES PARTICIPATION IN PUBLIC HEARINGS MATTER?

Yes! Public hearings provide an opportunity for ratepayers to comment on proposed rate changes as well as utility services. These voices, joined with that of Rate Counsel, can make a big difference. Speaking at a public hearing is important so ratepayers can communicate their positions to Rate Counsel and the BPU. Public participation also strengthens Rate Counsel's challenges to rate increase requests and affects decisions of the BPU.

Additional information on Rate Counsel can be found at the Division’s website at http://www.state.nj.us/rpa/  

Our address is 140 East Front Street, P.O. Box 003, Trenton, N.J. 08625.

Our phone number is 609-984-1460.

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