| JUNE 2, 2025 | OPINION, ENERGY & ENVIRONMENT
Everyone in New Jersey is feeling the pinch. This summer, electric bills are projected to spike by 20 to 30%. That’s not an abstract statistic — it’s an extra $30 a month for working families already stretched thin. That increase is set to hit monthly utility bills starting in June, but the underlying cause runs deeper, rooted in the decisions of the electrical grid operator for our region, PJM Interconnection, and the federal government.
Let me explain, and provide some solutions.
PJM: The quiet giant behind your electric bill
PJM Interconnection, an organization many New Jerseyans probably have never heard of, manages the electric grid for New Jersey and 12 other states. It’s the largest power grid in North America and is responsible for transmitting electricity, operating a competitive wholesale market and ensuring grid reliability.
Every three years, PJM runs a “capacity auction” — a wonky term for the process that sets the price power generators are paid to keep energy ready for use three years down the line. These decisions determine the utility rates passed on to consumers. In 2023, the amount paid to generators was $28.92 per megawatt-day. Last summer? It skyrocketed to $269.92 — nearly 10 times higher, an outrageous increase. What happened?
PJM claims it’s a simple case of supply and demand — the supply of energy is dwindling, while the demand is surging, which causes prices to increase. But that’s only part of the story. The real issue is that supply has been deliberately obstructed, and demand has been artificially inflated — both by a flawed PJM auction and poor leadership by the Trump administration.
A market rigged against clean energy
PJM claims that higher electricity costs are because of a severe energy supply shortage, but 286 gigawatts, the equivalent of nearly 300 new power plants, are stuck in PJM’s queue for new energy generation. This backlog in required approvals reduces the supply side of the energy equation, resulting in upward pressure on costs. While families are forced to make room in their budgets for rising electricity bills, the energy supply we need to bring costs down is literally sitting there, waiting for PJM to act. Even worse, over 90% of those projects are from clean, renewable energy.
The data shows that clean-energy sources such as solar and wind are over 50% cheaper to run than fossil fuels, but PJM’s bias against clean-energy producers keeps that less expensive power off the table. The result? Ratepayers get stuck footing the bill for older, dirtier, more expensive energy while the cheaper, greener alternatives are left waiting on the sidelines.
Since January, things have only gotten worse.
Trump’s energy sabotage
In President Trump’s first week in office, the administration took steps to halt green energy innovation across the country. That single move killed three major wind projects in New Jersey that would have generated enough energy to power more than 2 million homes. It also dealt a devastating blow to New Jersey’s economy — thousands of potential clean-energy jobs gone.
Then came the tariffs. In March, the Trump administration imposed a 10% tariff on imported electricity from Canada — a move that immediately drove up prices and rattled confidence in our energy supply. While some tariffs were later rolled back amid political pressure, the pattern of sudden imposition, partial repeal, and renewed threats created a cloud of uncertainty over our electricity markets. This instability disrupts long-term infrastructure planning and leaves ratepayers footing the bill.
Blocking clean-energy projects while propping up fossil fuels and imposing tariffs on electricity from our allies (like Canada) is a recipe for instability and higher costs. That’s exactly what we’re experiencing now and that’s what we will continue to experience under this federal administration.
The data center boom
Meanwhile, electricity demand is skyrocketing, driven not just by natural population growth or seasonal usage during an increasingly warmer summer but by a rapid, under-regulated surge in AI-driven data center development across the PJM region. Data centers now consume 5% of New Jersey’s total electricity — a number expected to more than double by 2030. That spike in demand directly contributed to the sky-high auction prices we’re now paying for.
But here’s the problem: PJM is operating without a clear understanding of how much electricity is being consumed by rapidly expanding AI-driven data centers — or where that demand is most concentrated. This lack of transparency distorts demand forecasts, which leads to inflated capacity prices, and leads to overbuilt, overpriced infrastructure. By failing to collect and share accurate data, PJM is planning in the dark — and we are paying a premium for it.
So what do we do?
First, we need to expand existing programs that help families immediately, because no one should have to choose between keeping the lights on and putting food on the table. Right now, only 20% of eligible New Jerseyans are enrolled in the Universal Service Fund (USF), a program administered by the Department of Community Affairs that provides up to $180 per month to low-income ratepayers. We need to make sure all eligible people are aware of the program while we consider ways to expand it — especially at a time when the Trump administration has gutted the federal Low-Income Home Energy Assistance Program (LIHEAP), creating even more uncertainty and depriving families of the energy assistance they need to stay warm in the winter and cool in the summer.
Meanwhile, PJM must act quicker to approve and connect the existing projects in their queue. PJM must review projects faster, adhere to federal guidelines mandating study deadlines of 150 days, and adopt binding deadlines to cut through red tape. If PJM refuses to fix its broken system, New Jersey must be ready to take bold action — even if that means pursuing an exit from the capacity market entirely. We can’t wait any longer.
At the same time, we must work for more timely remedies that hold PJM accountable for the harm already done. That’s why I support New Jersey’s Division of Rate Counsel in calling on the Federal Energy Regulatory Commission to order a rerun of PJM’s last capacity auction. The results weren’t just outrageous; they were unjust. PJM’s flawed rules allowed market manipulation, excluded low-cost resources and drove up costs unnecessarily. If FERC intervenes, ratepayers could see over $5 billion in savings. New Jersey families deserve a system that works for them, not for entrenched energy interests.
At the same time, we must modernize our grid so the power lines can carry more electricity. That’s why I’m introducing a legislative package focused on Advanced Transmission Technologies (ATT). These technologies can dramatically increase grid capacity, allowing utilities to deliver more electricity to their customers. The greater availability of energy will help hold down consumer costs. The legislative package will also require utilities to evaluate and integrate these tools in their long-term plans, protect vulnerable ratepayers and streamline permitting to make these upgrades faster and more efficient.
Clean energy is not the problem; it is the solution. Solar, battery storage and smart transmission technologies are the fastest path to long-term energy affordability and independence. They reduce emissions, create jobs, lower prices and prepare the grid for the demands of the 21st century.
The system must change. The success of our economy depends on a state-of-the-art energy infrastructure that meets the demands of the future while lowering costs for working families. Clinging to dirty, inefficient fossil fuels simply won’t cut it. Now is the time to pave the way for affordable energy independence, booming economic growth and a full embrace of our state’s clean-energy potential.
We owe it to every New Jersey family to stop playing politics and start making progress.
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