BPU President: Let’s protect N.J. ratepayers and the environment | Opinion

By Christine Guhl-Sadovy
As the utility regulator for New Jersey, we know that no one wants to see their electric bill increase. The recent increases to customers’ bills resulted from a combination of using more electricity due to extreme heat, rising energy prices, and necessary utility investments to ensure we have a reliable grid.
While we can’t promise that bills won’t continue to rise in the short term, affordability is critically important, and we are working hard to help keep costs down. As a customer, there are ways you can help lower your bills, too.
First, note that bills have risen because the real cost of energy has gone up. Every year, our electric utilities participate in a Basic Generation Service or “BGS” auction — that’s how electricity is purchased to meet the needs for New Jersey customers. The most recent auction results went into effect on June 1, 2024, resulting in a price increase compared to 2023. Depending on the provider, customers saw an average estimated bill increase between 3.6% and 8.6%.
In addition to these costs, there is a second energy market, called the Base Residual Auction or “BRA,” which is based on future demand for energy and is designed to encourage energy firms to build the infrastructure needed to handle it reliably. This year, those prices were also higher, which demonstrates that supply and demand are tightening across energy markets and may lead to cost increases down the road.
Second, energy use has also increased.
This summer was one of the hottest on record. By mid-summer alone, New Jersey had more than 20 days topping 90 degrees, so many people used their cooling systems more frequently and at higher intensities. While it may seem to make sense to lower the temperature as much as possible to fight the heat, turning the AC down to the 60s will not cool you off more quickly. It is true that lowering the temperature is not helping to cool down quicker, since an AC can only run at its capacity. The rate it cools is the same as long as the set temperature is not reached. It will, however, stress the grid and drive-up electric bills.
Additionally, using more electricity in the summer can cost more, because of the additional strain on the grid. While 78 degrees – the recommended temperature setting – may be too warm for some, the mid-70s would be a step in the right direction.
How can customers get relief?
For now, energy efficiency programs such as “Comfort Partners” can soften the blow, and so can the BPU’s REAP initiative, which helps roughly 278,000 qualifying energy customers received a $175 one-time bill credit. To apply for these programs, please visit us online, or call 866-378-4345. If you are struggling to make payments, please don’t wait until you are faced with service disruption.
Which brings us to longer-term challenges and solutions.
Right now, the source of New Jersey’s energy supply is largely natural gas and nuclear power. Natural gas is a fossil fuel, so it worsens climate change. Plus, the supply is finite, and prices can rise and fall with regional and global events. Nuclear power is a critical part of our clean energy future, but as of now, the cost and time it takes to build a new reactor can be prohibitive.
The only real solution is to embrace clean energy sources, like offshore wind and solar power – which can lower energy costs in the long term.
While both of those resources have upfront costs, over time they will not only bring down power costs, but the reduction in fossil fuels will positively impact climate change. Since the early 2000s, nearly five gigawatts of solar power have been built in New Jersey. In the last four years, our state has awarded projects in three offshore wind solicitations – with the most recently awarded projects that should generate 3.7 gigawatts more.
Combined, that is enough energy to power approximately 1.8 million New Jersey homes.
Under Governor Murphy’s leadership, New Jersey set out on a path to 100% clean energy. We have a prime opportunity to achieve what we set out to do – build a stronger and fairer New Jersey and reduce costs by investing in clean energy. It supports good, local, family-sustaining jobs that can’t be outsourced, and secures a healthier, more prosperous future for our children and grandchildren.
Christine Guhl-Sadovy is President of the New Jersey Board of Public Utilities.