The price of electricity will increase for most New Jersey utility customers starting in June, state officials announced on Wednesday.
The news comes as the New Jersey Board of Public Utilities certified the results of an annual auction that determines how much electric utilities pay for the power they then distribute. When the new energy year begins in June, electricity costs across the state are expected to rise between about 17% for PSE&G and Atlantic City Electric, 18% for Rockland Electric and 20% for JCP&L. That’s an average of $25 to $28 extra each month.
State officials said the driving factor in the price hike is PJM Interconnection, the company that operates the electrical grid for New Jersey and 12 other states. The PJM annual capacity auction saw an 800% increase in its costs over the last year, and that increase drove up prices at the state’s annual auction.
Rising demand for electricity across the region, spurred by data centers, comes as new power sources face long delays in connecting to the PJM grid. State officials from New Jersey, Pennsylvania and elsewhere have also cited PJM’s market rules as a factor in keeping prices high.
“This week’s BGS auction results are the culmination of several issues: rapidly increasing demand for electricity, coupled with limited supply growth due to lagging new generation interconnection, and flawed market dynamics in the PJM region,” said Christine Guhl-Sadovy, president of the BPU.
“PJM’s recent capacity auction results are the main driver of these increases. The Murphy administration will continue to aggressively push and hold PJM accountable to address rising costs by expediting interconnection and implementing additional market reforms, all of which will help drive down costs for ratepayers which is a priority for the BPU,” Guhl-Sadovy said.
