RELATED PARTY TRANSACTIONS

9 Months Ended

Jun. 30, 2023

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

15. RELATED PARTY TRANSACTIONS

Effective April 2020, NJNG entered into a 5-year agreement for 3 Bcf of firm storage capacity with Steckman Ridge, which expires on March 31, 2025. Under the terms of the agreement, NJNG incurs demand fees, at market rates, of approximately $9.3 million annually, a portion of which is eliminated in consolidation. These fees are recoverable through NJNG’s BGSS mechanism and are included as a component of regulatory assets.

Energy Services may periodically enter into storage or park and loan agreements with its affiliated FERC-jurisdictional natural gas storage facility, Steckman Ridge. As of June 30, 2023, Energy Services entered into transactions with Steckman Ridge for varying terms, all of which expire by March 31, 2024.

Demand fees, net of eliminations, associated with Steckman Ridge were as follows:

	Three Months Ended				Nine Months Ended
	June 30,				June 30,
(Thousands)	2023		2022		2023		2022
Natural Gas Distribution	$	1,703	$	1,651	$	4,973	$	5,015
Energy Services	167		187		494		552
Total	$	1,870	$	1,838	$	5,467	$	5,567

The following table summarizes demand fees payable to Steckman Ridge as of:

(Thousands)	June 30, 2023		September 30, 2022
Natural Gas Distribution	$	775	$	775
Energy Services	81		76
Total	$	856	$	851

NJNG and Energy Services enter into various AMAs, the effects of which are eliminated in consolidation. Under the terms of these agreements, NJNG releases certain transportation and storage contracts to Energy Services. As of June 30, 2023, NJNG and Energy Services had one AMA with an expiration date of March 31, 2024.

NJNG entered into a 5-year transportation agreement with Adelphia Gateway for committed capacity of 130,000 Dekatherms per day in Zone South, which began on August 9, 2022.

Energy Services has a 5-year agreement for 3 Bcf of firm storage capacity with Leaf River, which is eliminated in consolidation and expires in March 2024.

In March 2021, NJNG and Clean Energy Ventures entered into a 15-year sublease and PPA agreement related to an onsite solar array and the related energy output at the Company’s headquarters in Wall, New Jersey, the effects of which are immaterial to the consolidated financial statements.

In July 2021, NJNG entered into 16-year lease agreements, as Lessor, with various NJR subsidiaries, as Lessees, for office space at the Company’s headquarters in Wall, New Jersey, the effects of which are eliminated in consolidation.

In June 2022, NJNG and Clean Energy Ventures entered into a 20-year sublease and PPA agreement related to an onsite solar array and the related energy output at the Company’s liquefied natural gas plant in Howell, New Jersey, the effects of which are immaterial to the consolidated financial statements.

NJNG entered into a 15-year transportation precedent agreement with Adelphia Gateway for committed capacity of 130,000 Dekatherms per day in Zone North, beginning November 1, 2023; however, the agreement term will automatically be reduced to 7 years if Transcontinental Gas Pipe Line Corporation has not placed its Regional Energy Access Expansion project into service by October 31, 2030.

The intercompany profits for certain transactions between NJNG and Energy Services and NJNG and Adelphia Gateway are not eliminated in accordance with ASC 980, Regulated Operations.