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Gov. Christie's Bill Would Levy Hefty Fines Against Unprepared Utility Companies

Under governor's proposed legislation, utilities could face up to $25,000 per day in penalties for failing to adhere to their own service and communications plans.

Governor Chris Christie wants utility companies held accountable for their emergency preparedness.

Following the findings of a Board of Public Utilities (BPU) investigation released Wednesday, Christie proposed legislation empowering regulators to levy hefty fines against utilities. 

The legislation raises potential administrative penalties against companies from $100 to $25,000 per daily assessment.

Utility companies would be barred from passing along costs to ratepayers, Christie said. The bill prioritizes preparedness, according to Christie, requiring utility companies to provide detailed service delivery and communications plans to the BPU. Companies that fail to adequately follow their own plans will face the $25,000 per day civil penalty for a maximum of $2 million in fines.

“Hurricane Irene and then the October snowstorm posed some serious, unprecedented challenges for our utility providers,” Christie said, “While those storms brought out the real professionalism of so many of the employees of the public utilities, they also exposed the vulnerabilities of our utility infrastructure and avoidable mistakes, including the ability to communicate accurate, dependable and timely information to customers and local authorities.”

The proposed legislations stems from BPU’s recommendations following its performance review of utilities during Hurricane Irene and the October storm. The review provided specific action items for utility companies to increase preparedness, response and recovery during future storms.

Christie said the legislation provides a protection for ratepayers by allowing accountability and oversight from the BPU, providing higher standards for preparedness and reliability before large events such as a hurricane and pushing financial penalties with "real teeth."

After Hurricane Irene in 2011, Christie singled out power company JCP&L for what he called a failure to communicate effectively to the public, and provide adequate infrastructure.

On Wednesday, Christie said this legislation does not target one company, and could not comment further about JCP&L

JCP&L released a statement in the wake of the legislative announcement, saying it is currently reviewing BPU recommendations.

"As has been well documented, JCP&L has made many improvements in how we respond to major storms following Hurricane Irene and the October snowstorm."

The power company said it has added line crews and operations managers as well as invested $200 million to improve infrastructure in its coverage area.

"We have taken a close look at the events and missteps of last year, we are learning some lessons from it and taking action to fix the problem," Christie said. "We are also sending the message that these types of mistakes won't be tolerated."

While Christie said he found utility companies have responded better to severe weather events in 2012, he noted the companies have not faced a widespread event that matched the impact of Hurricane Irene and the sudden October snowfall.

"You really are challenged by the big events," Christie said.

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