As New Jersey residents brace for steep electric bill hikes this summer, Jersey Central Power & Light (JCP&L) announced it will dramatically scale back its major infrastructure upgrade plans. Last week, the New Jersey Board of Public Utilities (BPU) approved a downsized version of JCP&L’s “Energize NJ” project, reducing the utility’s original $930.5 million proposal by more than 75%.
Under the newly approved plan, JCP&L will invest $202.5 million over three and a half years beginning July 1. Rather than charging customers upfront, the utility will raise rates incrementally as work is completed. When the upgrades are finished, the average residential customer will see their monthly bill increase by approximately 86 cents — a modest 0.6% hike, according to JCP&L.
The announcement comes at a time of growing anxiety over energy prices. JCP&L customers are already set to see their bills jump by 20.2% starting June 1, following the results of New Jersey’s energy auction earlier this year. The auction, which determines the wholesale electricity price for customers who have not switched suppliers, saw rates surge due to growing demand and a backlog of power generation projects awaiting connection to PJM Interconnection, the regional grid operator.
In an effort to ease the burden on ratepayers, the BPU ordered all New Jersey electric utilities to submit plans by May 5 detailing how they intend to mitigate the impact of higher bills during the high-usage summer months. These strategies may include deferring rate increases to periods of lower usage and offering various forms of rate stabilization.
“While some progress has been made by PJM to fix its flawed market rules, more remains to be done,” said BPU President Christine Guhl-Sadovy in a statement. “The pace of positive change is not swift enough to benefit electric customers facing rising rates.”
JCP&L first introduced Energize NJ in November 2023 as the company’s largest-ever effort to upgrade its aging electric distribution system. The initial $935 million plan, later slightly reduced to $930.5 million, would have raised the typical customer’s monthly bill by about $4.07. However, after months of negotiations with the BPU, the Division of Rate Counsel, and the New Jersey Large Energy Users Coalition, the utility agreed to cut the scope of the project substantially.
As part of the settlement, JCP&L committed to seeking federal funding under the 2021 Infrastructure Investment and Jobs Act. Any funds awarded would be credited back to customers’ bills.
Brian Lipman, Director of the Division of Rate Counsel, praised the agreement, calling it “a good first step” toward balancing needed infrastructure improvements with fair treatment of ratepayers. “JCP&L has a lot of work in front of it to ensure that their customers get the reliable service they deserve,” Lipman said.
Despite the trimmed-down scope, JCP&L emphasized that critical upgrades will still move forward. The company plans to modernize sections of its distribution network with new technology that can detect and recover from temporary faults more quickly, install advanced monitoring equipment at substations, and invest heavily in system resiliency. This will include optimizing groups of power lines for greater operational flexibility and improving the ability to reroute power during outages. Additionally, JCP&L will replace vulnerable components at coastal substations and purchase new mobile substations that can be deployed during emergencies or maintenance work.
JCP&L President Doug Mokoid said the scaled project will still deliver important benefits to customers. “We are committed to making smart, responsible investments that enhance the reliability our customers expect and deserve, as well as the safety of our crews in the field,” Mokoid said. “Energize NJ will allow us to reduce the length and number of outages and better protect the workers who restore power.”
However, the plan’s sharp reduction has sparked political backlash. State Senator Joe Pennacchio (R-26) sharply criticized what he called the “failed energy policies” of Governor Phil Murphy and Democratic legislators in Trenton, blaming them for the soaring electricity costs and the necessity of scaling back grid improvements.
“Trenton Democrats turned off traditional energy sources and instead relied on unproven alternatives like wind and solar,” Pennacchio said. “Now JCP&L is being forced to clean up the Democrats’ mess and delay much-needed modernization of our grid.”
Pennacchio, a longtime critic of Governor Murphy’s energy agenda, warned that postponing infrastructure upgrades would only worsen future utility problems. He and Senator Owen Tiver (R-4) recently announced plans to introduce legislation that would temporarily suspend New Jersey’s sales and use tax, as well as the Societal Benefits Charge on electric bills — a move they argue would save consumers about 10% on their energy costs.
“Our ratepayers deserve better than this,” Pennacchio said.