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REGULATION | 6 Months Ended
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Mar. 31, 2017
Regulated Operations [Abstract] |
REGULATION | REGULATION NJNG is subject to cost-based regulation, therefore, it is permitted to recover authorized operating expenses and earn a reasonable return on its utility capital investments based on the BPU's approval. The impact of the ratemaking process and decisions authorized by the BPU allows NJNG to capitalize or defer certain costs that are expected to be recovered from its customers as regulatory assets and to recognize certain obligations representing amounts that are probable future expenditures as regulatory liabilities in accordance with accounting guidance applicable to regulated operations. NJNG's recovery of costs is facilitated through its base rates, BGSS and other regulatory tariff riders. NJNG is required to make an annual filing to the BPU by June 1 of each year for review of its BGSS, CIP and various other programs and related rates. Annual rate changes are requested to be effective at the beginning of the following fiscal year. In addition, NJNG is also permitted to request approval of certain rate or program changes on an interim basis. All rate and program changes are subject to proper notification and BPU review and approval. In September 2016, the BPU approved NJNG's base rate case, effective October 1, 2016, which included an increase in base rates in the amount of $45 million. The base rate increase includes a return on common equity of 9.75 percent, a common equity ratio of 52.5 percent and a depreciation rate of 2.4 percent. The approval also included the five-year extension of SAFE II, rate recovery of NJ RISE capital investment costs through June 30, 2016, recovery of NJNG’s SAFE I, NGV and LNG capital investments and recovery of other costs previously deferred in regulatory assets. Regulatory assets and liabilities included on the Unaudited Condensed Consolidated Balance Sheets are comprised of the following:
(Thousands) | March 31, 2017 | September 30, 2016
Regulatory assets-current |  |
Conservation Incentive Program | $ | 23,834 |  | $ | 36,957 |
New Jersey Clean Energy Program | 6,239 |  | 14,232 |
Underrecovered gas costs | 13,271 |  | — |
Derivatives at fair value, net | — |  | 3,097 |
Total current regulatory assets | $ | 43,344 |  | $ | 54,286 |
Regulatory assets-noncurrent |  |
Environmental remediation costs |  |
Expended, net of recoveries | $ | 19,067 |  | $ | 19,595 |
Liability for future expenditures | 165,849 |  | 172,000 |
Deferred income taxes | 21,209 |  | 20,273 |
Derivatives at fair value, net | 4,392 |  | 23,384 |
SAVEGREEN | 15,604 |  | 25,208 |
Postemployment and other benefit costs | 151,414 |  | 157,027 |
Deferred Superstorm Sandy costs | 14,116 |  | 15,201 |
Other noncurrent regulatory assets | 5,273 |  | 8,606 |
Total noncurrent regulatory assets | $ | 396,924 |  | $ | 441,294 |
Regulatory liability-current |  |
Derivatives at fair value, net | $ | 5,747 |  | $ | — |
Overrecovered gas costs | — |  | 9,469 |
Total current regulatory liabilities | $ | 5,747 |  | $ | 9,469 |
Regulatory liabilities-noncurrent |  |
Cost of removal obligation | $ | 17,224 |  | $ | 30,549 |
New Jersey Clean Energy Program | 10,269 |  | 10,657 |
Other noncurrent regulatory liabilities | 964 |  | 205 |
Total noncurrent regulatory liabilities | $ | 28,457 |  | $ | 41,411 |
Regulatory filings and/or actions that occurred during the current fiscal year include the following:
• | On March 31, 2017, NJNG filed its annual petition with the BPU requesting a base rate change in the amount of $4.3 million for the recovery of NJ RISE and SAFE II capital investment costs related to the period ending June 30, 2017, pursuant to the base rate case order dated September 23, 2016. The filing will be updated to reflect actual results in July 2017, with changes to base rates effective October 1, 2017.

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