NJ SHARES The Evaluation of 2007 Grants October 20, 2008 Revised 11/21/08

Evaluation Goals Characterize 2007 NJ SHARES grant recipients Characterize 2007 NJ SHARES grants Examine good faith payments Analyze post-grant payment compliance 2

Evaluation Components Part 1 – NJ SHARES database analysis Characterizes grant recipients Characterizes grants Part 2 – Utility transaction data analysis “Good Faith” Payment Analysis Grant Coverage Analysis Post-Grant Payment Compliance 3

Evaluation Components Data received from: ACE Elizabethtown Gas NJNG PSE&G SJG JCP&L (Not usable) Rockland (Not usable) 4

NJ SHARES Database Analysis 2007 Grant Counts by Utility Number of Grants Percent of All Grants Grant Dollars Percent of Grant Dollars Atlantic City Electric 414 6% $136,106 4% Elizabethtown 571 9% $326,337 8% JCP&L 964 15% $321,354 NJNG 552 $311,012 PSE&G 3,510 54% $2,450,168 64% Rockland 40 1% $12,779 <1% SJG 485 7% $284,427 TOTAL 6,536 100% $3,842,183 5

NJ SHARES Database Analysis Q1 Grant Counts by Type Electric Only 683 17% 715 19% 1,007 24% Gas Only 756 832 22% 1,036 Electric & Gas 2,416 61% 2,031 55% 1,979 46% Electric Heat 113 3% 140 4% 236 6% TOTAL 3,968 3,718 4,258 6

NJ SHARES Database Analysis 2007 Grant Counts by County Number Served Percent of Total Atlantic 180 2.8% Middlesex 613 9.4% Bergen 228 3.5% Monmouth 521 8.0% Burlington 209 3.2% Morris 259 4.0% Camden 440 6.7% Ocean 495 7.6% Cape May 44 0.7% Passaic 300 4.6% Cumberland 138 2.1% Salem 41 0.6% Essex 1,072 16.4% Somerset 165 2.5% Gloucester 226 Sussex 61 0.9% Hudson 487 7.5% Union 593 9.1% Hunterdon 27 0.4% Warren 63 1.0% Mercer 371 5.7% TOTAL 6,533 100.0% 7

NJ SHARES Database Analysis Years Received Grants, 2005-2008 Number of Years Percent of Grant Recipients 1 Year 82% 2 Years 13% 3 Years 4% 4 Years 1% Number of Years Percent of Grant Recipients 1 Year 82% 2 Years 13% 3 Years 4% 4 Years 1% 8

NJ SHARES Database Analysis Household Members Contributing to Income 2005 Recipients 2006 Recipients 2007 Recipients None <1 % 0% One 75% 73% 72% Two 22% 24% 25% Three or More 3% Mean Number 1.3 9

NJ SHARES Database Analysis 2005-2007 Recipient Income Sources 2005 Recipients 2006 Recipients 2007 Recipients Employment 88% 89% Pension or Social Security 12% 13% Unemployment Compensation 6% 5% Disability 4% Child Support 3% Other 10

NJ SHARES Database Analysis 2005-2007 Annual Household Income 2005 Recipients 2006 Recipients 2007 Recipients < $10,000 <1% 0% $10,000 - $19,999 9% 6% 5% $20,000 - $29,999 31% 28% 22% $30,000 - $39,999 29% $40,000 + 38% 45% Mean Annual Income $35,942 $38,921 $41,844 11

NJ SHARES Database Analysis 2005-2007 Household Poverty Level 2005 Recipients 2006 Recipients 2007 Recipients <175% 6% 5% 175% - 199% 26% 24% 20% 200% - 249% 32% 30% 250% - 299% 17% 16% 300% + 19% 22% 28% Mean Poverty Level 251% 257% 273% 12

NJ SHARES Database Analysis 2005-2007 Household Composition 2005 Recipients 2006 Recipients 2007 Recipients <6 Years Old 29% 26% 28% ≤ 18 Years Old 61% 60% 64% > 60 Years Old 8% 13% Note: A household can be included in more than one category. 13

NJ SHARES Database Analysis 2005-2007 Household Composition 2005 Recipients 2006 Recipients 2007 Recipients Single Parent 14% 13% 27% Elderly Only 4% 5% 9% Note: “Single Parent” and “Elderly Only” households were identified using the age grouping variables, in the database not the variable “Category”. 14

NJ SHARES Database Analysis 2006-2007 Household Poverty Level Household Composition 2006 Recipients 2007 Recipients All ≤ 18 Years Old > 60 Years Old <175% 6% 7% 5% 175% - 199% 24% 27% 26% 20% 22% 18% 200% - 249% 32% 33% 30% 250% - 299% 16% 17% 300% + 21% 28% 23% 31% TOTAL 100% 15

NJ SHARES Database Analysis 2006-2007 Household Poverty Level Household Composition 2006 Recipients 2007 Recipients All Single Parent Elderly Only <175% 6% 11% 5% 7% 175% - 199% 24% 34% 26% 20% 18% 200% - 249% 32% 30% 33% 28% 250% - 299% 16% 13% 17% 15% 300% + 22% 8% 21% TOTAL 100% 16

NJ SHARES Database Analysis 2005-2007 Recipient Household Size 2005 Recipients 2006 Recipients 2007 Recipients 1 26% 22% 24% 2 30% 28% 3 21% 4 14% 15% 17% 5 + 9% 10% 11% Mean Size 2.5 2.7 17

NJ SHARES Database Analysis 2005-2007 Main Heating Fuel 2005 Recipients 2006 Recipients 2007 Recipients Natural Gas 82% 83% 84% Electric 13% 11% Oil 5% 4% Propane <1% Other 18

NJ SHARES Database Analysis 2005-2007 Recipient-Reported Bill Balance at Grant Application 2005 Recipients 2006 Recipients 2007 Recipients < $250 8% 7% $250 - $499 25% 20% 23% $500 - $749 22% 24% $750 - $999 16% 15% 17% $1,000 + 29% 35% Mean Balance $892 $993 $879 19

Percent of Federal Poverty Level NJ SHARES Database Analysis 2007 Recipient-Reported Bill Balance at Grant Application Bill Balance Percent of Federal Poverty Level < 175% 175-199% 200-249 % 250-299% 300% + < $500 29% 30% 32% 27% $500 - $749 26% 23% 25% $750 + 45% 47% 46% 50% Mean Balance $836 $873 $864 $883 $932 20

NJ SHARES Database Analysis Mean 2005-2007 Recipient-Reported Bill Balance at Grant Application Grant Type 2005 Recipients 2006 Recipients 2007 Recipients Electric Only $563 $566 $557 Gas Only $654 $740 $762 Electric & Gas $1,108 $1,268 $1,168 Electric Heat $831 $823 $904 All Grants $892 $993 $879 21

NJ SHARES Database Analysis Collections Actions Pending at Grant Application for 2005-2007 Recipients Collections Actions 2005 Recipients 2006 Recipients 2007 Recipients Past Due Balance 8% 3% 17% Past Due Warning Notice 47% 18% Shut-Off Date Not Passed 20% 22% Shut-Off Date Passed 26% 49% 41% Utility Shut-Off 0% 9% 4% Note: Percentages may not sum to 100% because a household with grants for more than one utility may have two different collections actions. 22

NJ SHARES Database Analysis 2005-2007 Reason for Grant Application Reason for Application 2005 Recipients 2006 Recipients 2007 Recipients Temporary Financial Crisis 60% 68% -- High Energy Costs 27% 24% 69% Medical/Health 7% 5% 11% Unemployment 3% 2% 6% Reduced Hours/Change in Employment Other 8% 23

NJ SHARES Database Analysis Detailed 2007 Recipient “Other” Reasons for Grant Application Temporary financial crisis Household changes (spouse leaving or dying or a new baby in the home) Car repairs Meter read after months of low, estimated bills Over income limit for LIHEAP Mortgage, rent, or child support arrearages or increases Medical costs Home repairs Moving costs Other bills 24

NJ SHARES Database Analysis 2005-2007 Grant Amounts 2005 Recipients 2006 Recipients 2007 Recipients < $300 45% 14% 11% $300 <1% 20% $301 - $699 55% 28% 24% $700 0% 10% 17% $700 - $999 12% $1,000 22% Mean Grant $373 $603 $588 25

NJ SHARES Database Analysis 2007 Grant Amounts Grant Type Electric Only Gas Only Electric & Gas Electric Heat < $300 25% 10% 4% 5% $300 75% <1% 2% $301 - $699 0% 40% 28% 34% $700 50% 58% $700 - $999 $1,000 43% Mean Grant $277 $573 $797 $600 26

NJ SHARES Database Analysis 2007 Mean Grant Amount by Utility 2005 Recipients 2006 Recipients 2007 Recipients Atlantic City Electric $286 $331 $329 Elizabethtown $237 $504 $572 JCP&L $278 $303 $333 NJNG $246 $557 $563 PSE&G $420 $669 $698 Rockland $284 $319 SJG $236 $544 $586 27

PART 2 Utility Data Analysis Methodology Focused on Q1 2007 grant recipients Transaction data from participating utilities Files contain payments, charges, account balances Analyzed: Existence of “Good Faith Payment” Grant coverage of pre-grant balances Ratio of payments made to charges incurred at key intervals Used Q1 2006 and Q1 2008 recipients as comparison groups 28

Utility Data Analysis Sample Group Definitions Q1 2007 Recipient Treatment Group Q1 2006 Recipient Comparison Group Q1 2008 Recipient Comparison Group Accounts Included All Q1 2007 grant recipients Accounts receiving grants in Q1 2006 only Accounts receiving grants in Q1 2008 that did not receive grants in Q1 2007 Analysis Period Starts 1 day following grant 1 year + 1 day after grant 1 year + 1 day before grant Analysis Period Ends 2 years + 1 day after grant 1 day before grant Analysis Period Span Q1 2007– Q1 2008 29

Utility Data Analysis Sample Group Definitions (continued) 2006 Q1 2007 ANALYSIS PERIOD Q1 2006 ANALYSIS PERIOD Q1 2008 ANALYSIS PERIOD GRANT DATE GRANT DATE + 1 YEAR + 1 DAY GRANT DATE + 1 DAY GRANT DATE – 1 DAY 2007 2008 1 YEAR 30

“Good Faith” Payment Analysis “Good Faith” Period Definition The “Good Faith” payment period is defined as 90 days prior to intake through the day before the grant is applied to the account. Only payments made by the customer are counted. “GOOD FAITH” PERIOD INTAKE DATE – 90 DAYS GRANT DATE INTAKE DATE GRANT DATE – 1 DAY 31

“Good Faith” Payment Analysis Attrition Analysis Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Number Submitted 3,857 3,902 3,435 Number Returned 2,889 3,041 2,999 Eligible for Analysis* 1,445 1,974 2,789 Percent of Requested Accounts 37% 51% 81% * An account is eligible for analysis if we were able to find the NJ SHARES grant in the transaction data and if we were able to duplicate the utility-reported account balances. 32

“Good Faith” Payment Analysis Percent Making “Good Faith” Payment Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients 96% 98% 33

“Good Faith” Payment Analysis Payments Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients $0 2% 1% $1 - $99 $100 11% 15% 9% $101 - $250 26% 27% 23% $251 - $500 34% 30% 28% $501 + 25% 38% Mean Payment $394 $375 $502 34

“Good Faith” Payment Analysis Q1 2007 Recipients Payments Federal Poverty Level < 175% 175-199% 200-249% 250-299% ≥ 300% $0 0% 2% 1% $1 - $99 $100 24% 16% 15% 12% $101 - $250 28% 25% $251 - $500 29% 31% 32% $501 + 21% 26% 27% Mean Payment $340 $352 $379 $399 $396 35

“Good Faith” Payment Analysis Number of Payments for Those Paying at Least $100 Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients 25th Percentile 1 2 50th Percentile 75th Percentile 3 4 Mean Number of Payments 2.4 2.2 3.0 36

Grant Coverage Analysis Attrition Analysis Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Number Submitted 3,857 3,902 3,435 Number Returned 2,889 3,041 2,999 Eligible for Analysis* 1,834 2,473 2,874 Percent of Requested Accounts 48% 63% 84% * An account is eligible for analysis if we were able to find the NJ SHARES grant in the transaction data and if we were able to duplicate the utility-reported account balances. 37

Grant Coverage Analysis Q1 2006-Q1 2008 Grant Coverage Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Mean Pre-Grant Balance $892 $1,062 $1,173 Mean Grant $500 $589 $643 Mean Post-Grant Balance $392 $473 $530 Mean Percent of Pre-Grant Balances Covered 67% 68% 38

Grant Coverage Analysis Q1 2007 Grant Coverage Distribution Percentile 10% 25% 50% 75% 90% Percent of Pre-Grant Balances Covered 32% 47% 64% 85% 100% 39

Grant Coverage Analysis Q1 2007 Grant Coverage Q1 2007 Recipients Electric Only Gas Only Electric & Gas Electric Heat Mean Pre-Grant Balance $755 $992 $1,278 $1,017 Mean Grant $277 $555 $777 $573 Mean Post-Grant Balance $477 $437 $502 $444 Mean Percent of Pre-Grant Balances Covered 55% 73% 72% 67% 40

Payment Compliance Analysis Attrition Analysis Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Number Submitted 3,023 3,902 3,435 Number Returned 1,831 3,041 2,999 Accounts with Usable Data* 1,764 2,826 2,881 Amount of Data Available for Analysis 3 Months 1,458 2,370 2,097 6 Months 1,410 2,256 2,060 9 Months 1,357 2,144 1,992 12 Months 1,303 2,041 1,895 Percent of Requested Accounts 43% 52% 55% * An account has usable data if it appears to have received the NJ SHARES grant and if we were able to duplicate the utility-reported account balances. 41

Payment Compliance Analysis Mean Percent of Bills Paid Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients 3 Months 143% 82% 113% 6 Months 131% 95% 110% 9 Months 111% 93% 101% 12 Months 100% 83% 81% 42

Payment Compliance Analysis Mean Percent of Bills Paid Accounts with 12 Months of Data Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients 3 Months 140% 79% 113% 6 Months 130% 91% 110% 9 Months 111% 90% 101% 12 Months 100% 83% 81% 43

Payment Compliance Analysis Accounts with 12 Months of Data Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Pay ≥ 100% Pay ≥ 90% 3 Months 67% 72% 27% 34% 53% 59% 6 Months 70% 78% 33% 44% 54% 65% 9 Months 63% 77% 30% 46% 51% 66% 12 Months 49% 71% 19% 36% 13% 44

Payment Compliance Analysis Percent of Bills Paid Recipients with 12 Months of Data Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients < 50% 3% 7% 5% 50% - 75% 8% 27% 28% 76% - 90% 18% 30% 36% 91% - 99% 23% 17% 100% + 49% 19% 13% Mean 100% 83% 81% 45

Payment Compliance Analysis Mean Bill Balance Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Starting Balance $679 $380 $587 3 Months $519 $550 $563 6 Months $441 $495 $531 9 Months $517 $513 $581 12 Months $692 $773 $1,032 46

Payment Compliance Analysis Mean Bill Balance Accounts with 12 Months of Data Q1 2006 Recipients Q1 2007 Recipients Q1 2008 Recipients Starting Balance $661 $348 $574 3 Months $506 $520 $549 6 Months $429 $475 $518 9 Months $507 $511 $570 12 Months $692 $773 $1,032 47

Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients 48

Balance Declined, Ending Balance Balance Increased by <$100 Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Ending Balance <$100 Balance Declined, Ending Balance ≥ $100 Balance Increased by <$100 Balance Increased by Number of Customers 230 251 125 1,435 Percent of Customers 11% 13% 6% 70% Mean Pre-Grant Balance $618 $1,646 $935 $1,011 Mean Grant Amount $493 $599 $538 $617 Mean Post-Grant Balance $125 $1,047 $397 $394 Mean Number of Payments* 10 11 9 Mean Percent of Bills Paid 105% 118% 97% 72% * Note: Only customer payments are counted. 49

Balance Declined, Ending Balance Balance Increased by <$100 Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Ending Balance <$100 Balance Declined, Ending Balance ≥ $100 Balance Increased by <$100 Balance Increased by Number of Customers 230 251 125 1,435 Percent of Customers 11% 13% 6% 70% Mean Charges $1,976 $2,525 $2,319 $2,667 Mean Payments $2,082 $2,930 $2,269 $1,979 50

Balance Increased by $100 - $399 Balance Increased by $1,000 + Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Balance Increased by $100 - $399 Balance Increased by $400 - $999 Balance Increased by $1,000 + Number of Customers 487 634 314 Percent of Customers 24% 31% 15% Mean Pre-Grant Balance $789 $981 $1,427 Mean Grant Amount $513 $626 $765 Mean Post-Grant Balance $276 $355 $662 Mean Number of Payments* 9 8 Mean Percent of Bills Paid 84% 70% 57% * Note: Only customer payments are counted. 51

Balance Increased by $100 - $399 Balance Increased by $1,000 + Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Balance Increased by $100 - $399 Balance Increased by $400 - $999 Balance Increased by $1,000 + Number of Customers 487 634 314 Percent of Customers 24% 31% 15% Mean Charges $2,038 $2,570 $3,839 Mean Payments $1,785 $1,928 $2,382 52

Balance Declined, Ending Balance Balance Increased by <$100 Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Ending Balance <$100 Balance Declined, Ending Balance ≥ $100 Balance Increased by <$100 Balance Increased by Number of Customers 230 251 125 1,435 Percent of Customers 11% 13% 6% 70% Mean Starting Balance $81 $976 $327 $283 Mean Ending Balance -$26 $571 $377 $971 Percent Paying ≥ 90% 84% 100% 99% Percent Paying ≥ 100% 60% 0% 53

Balance Increased by $100 - $399 Balance Increased by $1,000 + Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Balance Increased by $100 - $399 Balance Increased by $400 - $999 Balance Increased by $1,000 + Number of Customers 487 634 314 Percent of Customers 24% 31% 15% Mean Starting Balance $213 $234 $490 Mean Ending Balance $466 $875 $1,948 Percent Paying ≥ 90% 30% 3% 0% Percent Paying ≥ 100% 54

Balance Declined, Ending Balance Balance Increased by <$100 Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Ending Balance <$100 Balance Declined, Ending Balance ≥ $100 Balance Increased by <$100 Balance Increased by Number of Customers 230 251 125 1,435 Percent of Customers 11% 13% 6% 70% Median Annual Income $36,186 $38,076 $39,672 $37,344 < 175% FPL 4% 7% 5% 175% – 199% FPL 19% 17% 23% 20% 200% - 249% FPL 29% 30% 27% 250% - 299% FPL 18% ≥ 300% FPL 28% Percent Single-Parent 22% Percent Elderly-Only 8%

Balance Increased by $100 - $399 Balance Increased by $1,000 + Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Balance Increased by $100 - $399 Balance Increased by $400 - $999 Balance Increased by $1,000 + Number of Customers 487 634 314 Percent of Customers 24% 31% 15% Median Annual Income $36,612 $37,200 $38,700 < 175% FPL 4% 5% 3% 175% – 199% FPL 18% 19% 23% 200% - 249% FPL 32% 30% 26% 250% - 299% FPL 16% ≥ 300% FPL 28% Percent Single-Parent 25% 29% Percent Elderly-Only 8% 9% 56

Balance Declined, Ending Balance Balance Increased by <$100 Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Grant Type Ending Balance <$100 Balance Declined, Ending Balance ≥ $100 Balance Increased by <$100 Balance Increased by Electric Only 22% 27% 24% 20% Gas Only 47% 35% 42% 26% Electric & Gas 30% 32% 51% Electric Heat 1% 3% 2% Total 100%

Balance Increased by $100 - $399 Balance Increased by $1,000 + Payment Compliance Analysis Segmentation Analysis of Q1 2007 Grant Recipients (continued) Grant Type Balance Increased by $100 - $399 Balance Increased by $400 - $999 Balance Increased by $1,000 + Electric Only 27% 18% 12% Gas Only 28% 26% 23% Electric & Gas 42% 53% 63% Electric Heat 3% 2% Total 100%

Percent Receiving USF or LIHEAP Payment Compliance Analysis Q1 2007 Grant Recipients Receiving USF or LIHEAP in the 12 Months Following Grant Utility Percent Receiving USF or LIHEAP ACE 19% Elizabethtown 6% NJNG 8% PSE&G 7% SJG 14% TOTAL 9% 59

Percent Receiving USF or LIHEAP Payment Compliance Analysis Q1 2007 Grant Recipients Receiving USF or LIHEAP in the “Good Faith” Period Utility Percent Receiving USF or LIHEAP ACE 3% Elizabethtown <1% NJNG 2% PSE&G 1% SJG TOTAL 60