Who Pays the SBC?

December 3, 2010 – In The News
NJ Spotlight

In the past year, gas and electric bills came with a surcharge called the societal benefits charge (SBC), which was used to fund solar and wind projects to help low-income households pay electric and gas bills and for a number of other purposes. The SBC’s charitable contribution raised concern for bigger businesses and institutions that end up paying a hefty surcharge every year, crippling their profits and budgets and making them less competitive. Another issue with the SBC is the question of who actually pays it. One of the largest and most profitable power producers in the region, PSEG Power, has never paid the surcharge for the gas it uses, avoiding an estimated $47 million in surcharges in the past year alone.

The unresolved issue is important to ratepayers because if other suppliers are granted similar perks, residential and small business customers will pay more for gas and bear a bigger burden for funding various surcharges, not just the SBC. Steven Goldenberg argued it would lead to increased ratepayer subsidies, such as power producers requesting exemption from paying the SBC. If so, it would have 60 percent of the gas ratepayers paying 100 percent of the SBC program.

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