By: Zach Blackburn
The Murphy administration continued to up the pressure on New Jersey’s much-maligned electric grid operator on Tuesday, highlighting a report critiquing the grid operator’s ability to bring new energy generators online.
State officials in New Jersey and across the mid-Atlantic have sent ire toward electric-grid operator PJM Interconnection since news broke that New Jerseyans could pay $25 more per month in utility bills as a result of the firm’s most recent energy auction. Tuesday’s 34-page report found PJM is to blame for obstacles preventing energy generation projects in the “queue” from being completed in a timely manner.
Synapse Energy Economics produced the report for advocacy group Evergreen Collaborative. PJM operates electric grids in New Jersey and 12 other states.
The report said hundreds of projects have faced years of delays due to PJM’s approval process, and if no fixes are made, utility prices could increase 60% by 2040. The report called on PJM to set a mandatory 150-day review process for projects, make the firm more transparent, and explore technological alternatives to improve energy storage and transmission.
“We need common-sense reforms at PJM to bring more clean power generation online as quickly as possible, and there’s no clearer way to do that than reforming PJM’s interconnection queue,” said Eric Miller, the executive director of the Murphy administration’s Office of Climate Action and the Green Economy. “As shown in the report, reforming the queue will allow us to bring resources online faster, save our consumers money, and add more jobs to the clean energy sector.”
The report claims implementing the key reforms could save New Jersey households $405 a year and create 313,000 jobs across the region.
PJM said unexpected spikes in energy demand, some of it sparked by artificial intelligence data centers, are the culprit for the sudden cost increases.
In a statement, PJM said the company has reformed its interconnection process and expects to complete 200 gigawatts’ worth of projects by late next year. PJM said it has been warning about a tightening supply/demand balance for two years, but stakeholders didn’t heed the calls until prices rose in the most recent energy capacity auction.
“As the report states, we began significant interconnection process reform in July 2023. In 15 months, PJM relieved the interconnection backlog by 60% and placed more than 6 [gigawatts] of new generation into service.”
Still, the political pressure has been intense, and PJM CEO Manu Asthana will reportedly step down at the end of the year.
Legislative Democrats joined in on the criticisms. Upon news that PJM CEO Manu Asthana would step down at the end of the year, State Sen. John Burzichelli (D-Paulsboro) bid Asthana adieu.
“The departure of PJM’s President is an opportunity for the organization that determines our utility rates to reform its practices to prevent the spikes in electric bills that have been imposed on New Jersey ratepayers,” Burzichelli said. “Hopefully, this signals a change in priorities that will make consumer affordability the principal goal.”
State Sen. Andrew Zwicker (D-South Brunswick), who serves with Burzichelli on the Senate Select Committee reviewing the spike in utility rates, said that regardless of who is CEO, leaders of PJM should be working on queue reform immediately. Until then, Zwicker said he plans to keep the pressure on.
“And here we were thinking PJM couldn’t retire outdated and expensive things,” he joked.
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