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Bill > A3904
NJ A3904
NJ A3904Directs BPU to establish program concerning renewable natural gas; provides gas public utilities with customer rate recovery mechanism for costs associated with program.
summary
Introduced
01/13/2026
01/13/2026
In Committee
01/13/2026
01/13/2026
Crossed Over
Passed
Dead
Introduced Session
2026-2027 Regular Session
Bill Summary
This bill directs the Board of Public Utilities (BPU) to establish a renewable natural gas program to encourage gas public utilities (utilities) to procure renewable natural gas and invest in renewable natural gas infrastructure. As part of this program, the bill also requires the BPU to adopt a ratemaking mechanism to allow for the recovery of all costs prudently incurred by a utility under the program. Specifically, the ratemaking mechanism would allow utilities to periodically recover the following costs from ratepayers, subject to approval by the BPU: (1) any capital investments in renewable natural gas infrastructure incurred by the utility for the purpose of providing renewable natural gas service under the program, including the cost of capital, as determined in the utility's most recent rate case, and any other incremental costs associated with these investments; (2) any operating costs incurred by the utility associated with the program; and (3) any costs of procuring renewable natural gas from a third party, including affiliates of the utility. When a utility procures renewable natural gas from a third party, the bill requires the utility to purchase the renewable natural gas supply at prices and on terms consistent with market conditions. The bill also requires the BPU to regulate the charges assessed to customers of the utility for the supply of renewable natural gas, which charges would be based on the utility's cost of providing such supply, including renewable natural gas commodity and capacity costs, as well as any related ancillary and administrative costs.
AI Summary
This bill directs the Board of Public Utilities (BPU), a state agency that regulates utilities, to create a program encouraging gas public utilities, which are companies that distribute natural gas to homes and businesses, to purchase and invest in renewable natural gas. Renewable natural gas is defined as processed biogas (gas from decomposing organic matter), hydrogen from renewable energy, or methane from a mix of renewable sources and waste carbon dioxide, all treated to meet pipeline standards. The bill also mandates that the BPU establish a system for these utilities to recover the costs associated with this program from their customers, known as ratepayers. This cost recovery mechanism will allow utilities to be reimbursed for their investments in renewable natural gas infrastructure, their operating expenses for the program, and the cost of buying renewable natural gas from third parties, including affiliated companies, as long as these purchases are at market-based prices. The BPU will also regulate the prices charged to customers for this renewable natural gas, ensuring they reflect the utility's actual costs, including commodity, capacity, and administrative expenses.
Committee Categories
Transportation and Infrastructure
Sponsors (9)
Lou Greenwald (D)*,
Robert Karabinchak (D)*,
Dan Hutchison (D),
Cody Miller (D),
Gregory Myhre (R),
Verlina Reynolds-Jackson (D),
Gerry Scharfenberger (R),
Bill Spearman (D),
Lisa Swain (D),
Last Action
Introduced, Referred to Assembly Telecommunications and Utilities Committee (on 01/13/2026)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.njleg.state.nj.us/bill-search/2026/A3904 |
| BillText | https://pub.njleg.gov/Bills/2026/A4000/3904_I1.HTM |
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