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Electricity rates just went up in New Jersey: What you need to know.

Bill & Rates
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David Energy Staff
July 9, 2024
Resource
For Business

Electricity rates just went up in New Jersey: What you need to know.

Bill & Rates
No items found.
David Energy Staff
July 9, 2024
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In case you missed it: New Jersey electricity prices are going up. 

This may not come as shocking news, with prices for just about everything increasing in recent years. But if you are a home or business owner in New Jersey, it likely isn’t a welcome development – especially given that you already pay around 10% more for electricity than the national average.

Here’s what you need to know about when and why New Jersey electricity prices are going up, and what you can do about it.

What’s happening with New Jersey electricity rates? 

New Jersey electricity prices are going up as a result of an auction for Basic Generation Service (BGS), approved by the New Jersey Board of Public Utilities (NJBPU) in February 2024. The auction determines, in part, the utility’s rates for the subsequent year: this particular auction was the 23rd annual one, and the resulting rate increases kicked in on June 1.

As for what it all means? The NJBPU has effectively given the green light to the four biggest utilities for residents and small to medium-sized businesses in the state to raise rates. 

That means that those utilities—Atlantic City Electric Company (ACE), Jersey Central Power & Light Company (JCP&L), Public Service Electric & Gas Company (PSE&G), and Rockland Electric Company (RECO)—will increase rates, resulting in an average power bill increase for both business and residential customers of between 3.6% and 8.6% (depending on which utility  they’re with).

Why is it happening? 

In New Jersey, the major utility companies (ACE, JCP&L, PSE&G, and RECO) provide electricity to homes and businesses – they’re responsible for the poles and wires that deliver your power every day. They also act as a power supplier for customers who don’t choose an alternative supplier— this is called Basic Generation Service, or BGS as mentioned above.

BGS rates are determined as a part of an annual auction, in which companies bid to supply electricity to the utilities. The BGS auction occurs once per year, as part of the process that sets rates for the subsequent 12-month period.       

Who is impacted? 

Most residential and small business customers in New Jersey are likely to see a price hike for electricity service starting in June. Large commercial consumers could also see rate increases, but for different reasons. Remember, too, that customers who get their energy from an alternative supplier – not one of the large four companies mentioned – should not be impacted by these rate hikes. 

How much will my bill increase?

It’s expected that the average monthly electricity bill will increase between 3.6% and 8.6%. Depending on which utility delivers your power, the increases will vary as follows:

  • Atlantic City Electric Company (ACE): 4.8%
  • Jersey Central Power & Light Company (JCP&L): 8.6%
  • Public Service Electric & Gas Company (PSE&G): 6.2%
  • Rockland Electric Company (RECO): 3.6%

Is there any way to avoid the price increases? 

Remember how we discussed the difference between using the electricity supply provided by your utility, or choosing an alternate supplier? Since the utility’s supply rates are the ones going up as a result of the BGS auction, you can potentially avoid electricity price hikes by switching to an alternate, independent supplier. 

Independent suppliers like David Energy are not subject to supply rate increases – our independence allows us to offer small businesses a different price for electricity supply, because we are not a part of the BGS auction process. Plus, you can explore multiple types of rates and terms to find the right contract for your business’s unique needs – not just the one-size-fits-all rate from your utility.

This is why customer choice matters when it comes to electricity. If you want to dodge higher energy bills, it may be a good idea to see how independent suppliers like David Energy compare to your current rates – before you see that price hike hit your bill.  

Take advantage of retail choice in the New Jersey electricity market. Learn more about how David Energy can help you avoid electricity price increases, and help you choose the best energy plan for your home or business.

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