Assembly lawmakers to weigh bills aimed at easing impact of electricity prices

Yahoo

05-05-2025

Lawmakers are moving to defray the impact of surging electricity costs expected to raise monthly bills by about 20% beginning this June. (Dana DiFilippo | New Jersey Monitor)
An Assembly panel on Monday will consider a spate of bills meant to ease the impact of electricity prices set to surge in June.
Among the bills are measures that would alter how state regulators set profit margins for utilities, create training requirements for those regulators, and require the Board of Public Utilities to study the impact data centers have on electricity prices.
'We're not going to find a one-fix silver bullet that's going to solve the entire issue. It's going to need to be piecemeal,' said Assemblyman Avi Schnall (D-Ocean), a sponsor of one of the bills. We're going to have to find a little bit here and a little bit there and a little bit over there.'
The hearing comes about a month before electricity prices are set to surge upward by roughly 20% as a result of price-setting auctions held in July and February. The increase could add approximately $25 to an average customer's monthly bill.
Schnall's bill would require the Board of Public Utilities to use a stricter standard when setting utilities' return on equity rates — the rate at which they are allowed to profit on infrastructure and other investments.
At present, most New Jersey utilities' return on equity rates hovers around 9.6%. Utility providers are not permitted to profit off the sale of electricity itself — they sell it to customers at cost — but they can recoup costs for other investments, including capital costs, that are typically passed directly along to consumers.
The bill would require the BPU to approve the 'lowest reasonable' return on equity, rather than the fair and reasonable standard used under existing regulations. It's not clear how much the change would affect utility bills (parts of the measure would take effect months after being signed into law).
'More money going back to customers is more money going back to customers,' Schnall said.
Other bills in the package would require utilities to return excess profits to ratepayers as a direct credit to future bills or through direct payments to customers who have unpaid bills or are enrolled in utility assistance programs.
The BPU also sets revenue requirements for New Jersey utilities.
Republican officials have blamed Gov. Phil Murphy's ambitious clean energy goals — and his focus on offshore wind projects that are now stalled under the Trump administration — for growing rates.
Assemblyman Christian Barranco (R-Morris), an electrician by trade, panned most of the bills on the committee's Monday agenda, warning measures to limit utilities' profitability would limit their ability to attract the investment needed to upgrade their infrastructure. Barranco's comments echo concerns utility operators voiced at a legislative hearing on electricity prices in late April.
He noted Jersey Central Power and Light had recently pared down a $930.5 million infrastructure investment plan by nearly 80% in a bid to keep rates down.
'That's what's going to be affected, that sort of investment — that sort of keeping up with the reliability of the infrastructure that we'd like to see in a first-world country like ours,' Barranco said.
He praised a separate bill that would appropriate $5 million for the BPU to study the feasibility of small modular nuclear reactors statewide.
One Republican member expressed cautious support for the bill package but warned that, while the bills could help control the cost of electricity in the long run, they would do little to relieve the short-term impact of surging prices.
'I think it's a package that is not going to help ratepayers anytime soon,' said Assemblyman Alex Sauickie (R-Ocean).
He said Republican proposals to lower or suspend the societal benefits charge — a 3% surcharge on all New Jersey electricity bills — or exempt utility services from the state's sales tax would deliver more immediate relief.
Democrats have said that PJM Interconnection, the grid operator for New Jersey, 12 other states, and the District of Columbia, is to blame for the rate spikes because the interconnector has been slow to add some renewable projects to its grid.
Utility prices may become an even more pressing concern for low-income New Jerseyans in the next federal fiscal year. President Donald Trump has proposed zeroing out just over $4 billion in funding for a low-income home energy assistance program.
'The Budget proposes to end this program and to instead support low-income individuals through energy dominance, lower prices, and an America First economic platform,' the Trump administration said in a budget document released Friday.
New Jersey received nearly $133 million in awards under the program, which is meant to provide heating and cooling assistance to households making no more than 60% of the state's median income. That cutoff was $92,108 for a four-person household in the current federal fiscal year.
New Jersey Department of Community Affairs Commissioner Jacquelyn Suárez told state Senate lawmakers last week that she expected New Jersey to receive federal funds for the program approved for the current federal fiscal year, which runs through Sept. 30, but her department had not been told that the program would not be funded in the following federal fiscal year.
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