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BPU warns summer electricity bills likely to spike; proposes expanded assistance and urges federal fixes
Summary
BPU officials told the Assembly committee that high PJM capacity auction prices could push average customer bills up by roughly 17–20% in June, outlined mitigation steps including expanded USF bill credits and short-term bill-smoothing proposals, and said long-term relief depends on faster project reviews at PJM and new generation.
New Jersey’s Board of Public Utilities told the Assembly Budget Committee that a spike in regional capacity prices could push residential electricity bills higher this summer and outlined a mix of short- and longer-term actions to reduce the burden on ratepayers.
A BPU representative explained the role of PJM — the regional transmission organization responsible for the capacity auction — and said last year’s auction produced clearing prices that were “nearly 10 times higher” than the previous year, a result the BPU said is a primary driver of the projected June increases. The BPU estimated the June adjustment could be on the order of 17–20% for some customers, depending on utility territory and the customer’s usage profile.
The agency described immediate mitigation options the board is pursuing or has proposed: expanding the Universal Service Fund (USF) enrollment and bill-credit minimums, authorizing residential energy assistance payments again this summer for low- and moderate-income customers, directing utilities to offer mitigation plans and deferred-payment arrangements, and seeking to smooth summer rate shock by allowing utilities to defer some of the summer increase and recover it across lower-usage months.
The BPU also told the committee it has been pressing PJM to speed review of queued projects that would increase supply, to change market rules so existing generation is consistently bid into capacity auctions, and to pursue other market fixes at FERC. The agency said storage and solar are the fastest ways to add new clean capacity in the near term; it also issued a request for information exploring possible new nuclear options, including small modular reactors, for longer-term supply.
Lawmakers raised concerns about enrollment and outreach: BPU officials cited a consultant study showing USF enrollment was about 20% of eligible customers, acknowledged stigma and data-sharing hurdles, and described utility-assistance days and proposed utility enrollment targets to boost participation. Committee members also questioned whether expanding disconnection-prevention programs to summer months and suspending reconnection fees would shift costs to other customers; the BPU said enrolled customers would generally be placed into deferred-payment arrangements and that the programs are targeted to those meeting income or hardship criteria.
On offshore wind, the BPU said developers who did not build projects did not receive ratepayer dollars for projects that produced no electricity; the state reported receiving a settlement payment related to a canceled project. The board stressed that projects must produce electricity to receive ratepayer funds.
The committee requested additional data from the BPU on average non-energy charges, the total "societal benefits charge" allocations, scheduled utility assistance days, and a summer-average bill estimate; the BPU agreed to provide further details to the committee through the chair.
