Exhibit 5-2

                 [LETTERHEAD OF RICHARDS, LAYTON & FINGER, P.A.]

                                December 27, 2001

PSE&G Capital Trust III
c/o Public Service Electric and Gas Company
80 Park Plaza
Newark, NJ  07101-0570

      Re:   PSE&G Capital Trust III

Ladies and Gentlemen:

      We have acted as special  Delaware counsel for Public Service Electric and
Gas Company, a New Jersey  corporation (the "Company"),  and PSE&G Capital Trust
III, a Delaware business trust (the "Trust"), in connection with the matters set
forth herein. At your request, this opinion is being furnished to you.

      For purposes of giving the opinions hereinafter set forth, our examination
of documents has been limited to the  examination  of originals or copies of the
following:

      (a) The Certificate of Trust of the Trust,  dated as of April 19, 1996, as
filed in the  office of the  Secretary  of State of the State of  Delaware  (the
"Secretary  of State") on April 19,  1996,  as  amended  by the  Certificate  of
Amendment thereto,  dated as of December 27, 2001, as filed in the office of the
Secretary of State on December 27, 2001 (as so amended, the "Certificate");

      (b) The Trust  Agreement of the Trust,  dated as of April 19, 1996,  among
the Company, as sponsor, and the trustees of the Trust named therein, as amended
by the Removal and Appointment of Trustee of the Trust, dated as of December 27,
2001;

      (c) A form of Amended and Restated Trust Agreement of the Trust (including
Exhibits A, C and D thereto) (the "Trust  Agreement"),  to be entered into among
the  Company,  as sponsor,  the  trustees of the Trust  named  therein,  and the
holders,  from time to time, of undivided  beneficial interests in the assets of
the Trust,  attached  as an exhibit to the  Registration  Statement  (as defined
below);


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PSE&G Capital Trust III
December 27, 2001
Page 2

      (d) The Registration Statement on Form S-3 (the "Registration Statement"),
including a  prospectus  (the  "Prospectus"),  relating  to the trust  preferred
securities  of the Trust  representing  undivided  beneficial  interests  in the
assets  of the  Trust  (each,  a  "Preferred  Security"  and  collectively,  the
"Preferred  Securities"),  as proposed to be filed by the Company, the Trust and
PSE&G Capital  Trust IV, a Delaware  business  trust,  with the  Securities  and
Exchange Commission (the "SEC") on or about December 27, 2001; and

      (e) A Certificate of Good Standing for the Trust, dated December 27, 2001,
obtained from the Secretary of State.

      Capitalized  terms  used  herein  and not  otherwise  defined  are used as
defined in the Trust Agreement.

      For purposes of this  opinion,  we have not reviewed any  documents  other
than the documents listed in paragraphs (a) through (e) above. In particular, we
have not reviewed any document  (other than the  documents  listed in paragraphs
(a) through (e) above) that is referred to in or  incorporated by reference into
the documents  reviewed by us. We have assumed that there exists no provision in
any document  that we have not reviewed that is  inconsistent  with the opinions
stated herein. We have conducted no independent factual investigation of our own
but rather have relied solely upon the foregoing  documents,  the statements and
information  set forth  therein and the  additional  matters  recited or assumed
herein,  all of which we have  assumed to be true,  complete and accurate in all
material respects.

      With  respect to all  documents  examined  by us, we have  assumed (i) the
authenticity of all documents submitted to us as authentic  originals,  (ii) the
conformity  with the  originals  of all  documents  submitted to us as copies or
forms, and (iii) the genuineness of all signatures.

      For purposes of this opinion, we have assumed (i) that the Trust Agreement
and the Certificate are in full force and effect and have not been amended, (ii)
except to the extent provided in paragraph 1 below,  that each of the parties to
the documents examined by us has been duly created,  organized or formed, as the
case may be,  and is validly  existing  in good  standing  under the laws of the
jurisdiction governing its creation,  organization or formation, (iii) the legal
capacity of natural  persons who are  parties to the  documents  examined by us,
(iv) that each of the parties to the documents  examined by us has the power and
authority to execute and deliver,  and to perform its  obligations  under,  such
documents, (v) that each of the parties to the documents examined by us has duly
authorized,  executed and  delivered  such


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PSE&G Capital Trust III
December 27, 2001
Page 3

documents, (vi) the receipt by each Person to whom a Preferred Security is to be
issued  by the Trust  (collectively,  the  "Preferred  Security  Holders")  of a
Preferred Securities Certificate for such Preferred Security and the payment for
the Preferred  Security  acquired by it, in accordance  with the Trust Agreement
and the  Registration  Statement,  and (vii) that the Preferred  Securities  are
issued and sold to the Preferred  Security  Holders in accordance with the Trust
Agreement  and the  Registration  Statement.  We have  not  participated  in the
preparation of the Registration  Statement and assume no responsibility  for its
contents.

      This  opinion is limited to the laws of the State of  Delaware  (excluding
the  securities  laws of the State of Delaware),  and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal laws
and rules and regulations  relating thereto. Our opinions are rendered only with
respect to Delaware laws and rules,  regulations and orders  thereunder that are
currently in effect.

      Based upon the  foregoing,  and upon our  examination of such questions of
law and  statutes of the State of Delaware as we have  considered  necessary  or
appropriate,  and subject to the  assumptions,  qualifications,  limitations and
exceptions set forth herein, we are of the opinion that:

      1. The  Trust  has been  duly  created  and is  validly  existing  in good
standing as a business trust under the Delaware Business Trust Act.

      2. The  Preferred  Securities  will  represent  valid and,  subject to the
qualifications  set forth in  paragraph  3 below,  fully paid and  nonassessable
undivided beneficial interests in the assets of the Trust.

      3. The Preferred Security Holders, as beneficial owners of the Trust, will
be  entitled  to  the  same  limitation  of  personal   liability   extended  to
stockholders  of private  corporations  for profit  organized  under the General
Corporation  Law of the State of Delaware.  We note that the Preferred  Security
Holders may be obligated to make payments as set forth in the Trust Agreement.

      We consent to the filing of this opinion with the SEC as an exhibit to the
Registration  Statement.  In addition,  we hereby consent to the use of our name
under the heading  "Legal  Matters" in the  Prospectus.  In giving the foregoing
consents,  we do not thereby  admit that we come within the  category of Persons
whose  consent is required  under  Section 7 of the  Securities  Act of 1933, as
amended,  or the rules and regulations of the SEC  thereunder.  Except as stated
above,  without our prior written


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consent,  this opinion may not be furnished or quoted to, or relied upon by, any
other Person for any purpose.

                                       Very truly yours,

                                       Richards, Layton & Finger, P.A.

BJK/MVP