PSE&G Proactively Implements Summer Relief Initiative to Protect Residential Electric Customers from Higher Costs

Rhea-AI Summary

PSE&G announced a Summer Relief Initiative to protect residential electric customers from a 17% rate increase starting June 1, 2025. The initiative includes a Summer Moratorium from July 1 to September 30, 2025, providing utility shut-off protection for low-income customers, and suspension of reconnection fees. The company filed with the New Jersey Board of Public Utilities to defer the supply increase effects over summer months. PSE&G will continue paying electricity suppliers the full cost during this period. The rate increase stems from PJM's capacity price auction, reflecting a regional power supply-demand imbalance. Despite challenges, PSE&G maintains customer bills are near 2008 levels when adjusted for inflation. The company offers various assistance programs including LIHEAP, SHARES, Equal Payment Plan, and Deferred Payment Arrangements to help customers manage costs.

Positive

• Implementation of Summer Relief Initiative to protect vulnerable customers from disconnection
• Suspension of reconnection fees to support customers
• Proposal to defer summer electric supply increase pending BPU approval
• Maintenance of customer bills near 2008 levels when adjusted for inflation
• Multiple customer assistance programs available including LIHEAP and payment arrangements

Negative

• 17% increase in electric rates due to PJM capacity price auction
• Significant regional power supply-demand imbalance
• Higher summer electricity usage expected to compound cost burden for customers
• Continued payment of full cost to electricity suppliers during deferral period may impact company finances

Insights

Utility Industry Analyst

PSE&G implements customer protection measures against 17% rate increase while continuing to pay suppliers, balancing stakeholder interests during market constraints.

PSE&G's Summer Relief Initiative represents a strategic approach to managing the fallout from a significant 17% electric rate increase stemming from PJM's capacity price auction. The three-pronged approach—implementing a Summer Moratorium to prevent disconnections, suspending reconnection fees, and seeking regulatory approval to defer the supply increase—demonstrates the utility's attempt to balance multiple stakeholder interests in a challenging market environment.

The company is carefully positioning itself as consumer-friendly while explicitly noting that it's "not the cause" of the rate increase. This messaging strategy shifts responsibility to external market forces while portraying PSE&G as part of the solution. Importantly, the utility has specified it will continue paying electricity suppliers the full cost during any deferral period, indicating these measures represent timing adjustments rather than cost eliminations.

From a market perspective, PSE&G's emphasis on the supply-demand imbalance in New Jersey's energy market highlights a fundamental structural challenge. The company appears to be laying groundwork for supporting policies that would encourage new generation development—potentially creating future opportunities within constraints.

The utility's reference to maintaining bills near 2008 levels when adjusted for inflation, alongside multiple industry awards for reliability and customer satisfaction, suggests effective long-term cost management and operational excellence despite market pressures. These credentials strengthen PSE&G's position with regulators as it seeks approval for its deferral program.

While providing immediate customer relief, this initiative creates a complex balancing act between short-term consumer protection and longer-term financial recovery of deferred costs. The absence of specific financial impact details in the announcement leaves questions about potential effects on near-term cash flow and earnings.

PSE&G Also Continues to Support Deferral of Electric Supply Increase This Summer Due to Record-Setting Electric Supply Auction

NEWARK, N.J., June 3, 2025 /PRNewswire/ -- PSE&G today announced that it is proactively implementing a Summer Relief Initiative to protect qualified residential electric customers from disconnection, while seeking approval from the New Jersey Board of Public Utilities (BPU) to provide New Jerseyans relief on their summer electric bills. To combat the significant electric supply price increase on June 1 that is the result of PJM's capacity price auction, PSE&G is proactively implementing a Summer Relief Initiative including:

• A Summer Moratorium – an expansion of the Winter Termination Program, beginning July 1, 2025, ahead of additional residential customer relief efforts. The program provides utility shut-off protection to low-income and qualified individuals and will continue through the summer months until September 30, 2025.
• A suspension of reconnection fees.

The implementation of the Summer Moratorium and reconnection fee suspension comes on the heels of the company's filing with the BPU where we propose to defer the effects of the June 1 supply increase for residential electric customers over the summer months.

PSE&G first filed for approval of this action on May 7 and added additional support for residential customers on May 15, which is pending BPU review and approval.

"There is now widespread recognition that New Jersey needs more power generation to address the forecasted energy supply-demand imbalance," said Kim Hanemann, president and COO, PSE&G. "PSE&G is not the cause of the 17% rise in electric rates, but we can support our customers by advancing critical solutions. These actions should help relieve a burden to families and communities just as the weather is getting warmer and electricity usage hits its peak. We encourage our customers to reach out to us if they are struggling to pay their bill so we can help them access the solutions available."

New Jerseyans' energy usage is already at its highest during the summer months and the required electric rate increase would only exacerbate the situation. During this summer deferral period, PSE&G will still continue to pay the electricity suppliers, who benefit from the supply increase, the full cost of the generation in the new electric supply rate.

PSE&G is proud of its track record of high customer satisfaction while maintaining customer affordability and award-winning reliable service. PSE&G combined electric and gas bills are nearly equivalent to their 2008 levels when adjusted for inflation.

Understanding the Impact of Summer Heat on Bills

It is important not to confuse increased electric rates with increased electric usage: summer months often coincide with high heat, frequently leading to increased electric usage as customers run their air conditioners more often. The amount of electricity needed to cool your house to 75 degrees when it's 90 degrees outside is 125% higher than when it's 85 degrees outside.

Regardless of electric rates, customers can take steps now to understand and manage their energy usage. Customers can find valuable energy efficiency information at pseg.com/energyefficiency and bizsave.pseg.com.

Long-term Solutions Needed

For several years, PSE&G has been warning about the supply and demand imbalance in the region.

We remain committed to working with policymakers regarding long-term solutions to these significant rate increases, including advancing policies that encourage the development of new power generation in New Jersey.

PSE&G Customer Assistance

PSE&G works directly with its customers, and with nonprofits and community organizations who work with utility customers, to inform them about energy assistance options.

PSE&G provides information regarding affordability options that customers may qualify for based on certain criteria like income eligibility (i.e. the Low Income Home Energy Assistance Program [LIHEAP], or SHARES for customers who may be experiencing a temporary financial crisis).

There are also additional bill payment tools to help customers manage costs, including PSE&G's Equal Payment Plan and Deferred Payment Arrangements. PSE&G's Equal Payment Plan estimates annual energy costs, and divides bills into 12 equal monthly payments, which allows customers to levelize their monthly spend expectations. Deferred Payment Arrangements allow customers to pay a portion of past-due balances over an agreed-upon period.

Customers can find valuable energy assistance information at pseg.com/saveenergy.

PSE&G
Public Service Electric & Gas Co. is New Jersey's oldest and largest gas and electric delivery public utility, as well as one of the nation's largest utilities. PSE&G has won the ReliabilityOne® Award for superior electric system reliability in the Mid-Atlantic region for 23 consecutive years. For the third consecutive year, PSE&G is the recipient of the ENERGY STAR Partner of the Year award in the Energy Efficiency Program Delivery category. In addition, in 2024 J.D. Power named PSE&G number one in customer satisfaction with residential electric service and gas service in the east among large utilities. PSE&G is a subsidiary of Public Service Enterprise Group Inc., (PSEG) (NYSE:PEG), a predominantly regulated infrastructure company focused on a clean energy future and has been named to the Dow Jones Sustainability Index for North America for 17 consecutive years (www.pseg.com).

Forward-Looking Statements
This release includes forward-looking statements, including but not limited to statements regarding anticipated or expected energy savings, cost saving and greenhouse gas emissions avoidance. There can be no assurance that such energy and costs savings and greenhouse gas emissions avoidance will be realized in the amounts described and / or in the timeframes anticipated. Such statements are based on management's beliefs as well as assumptions made by and information currently available to management but are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Factors that may cause actual results to differ include, without limitation: the ability to implement our energy efficiency business strategy, and customer adoption of our energy efficiency offerings. All forward-looking statements made in this release are qualified by these cautionary statements and readers are cautioned not to place undue reliance on these forward-looking statements The forward-looking statements contained in this Report are intended to qualify for the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

Visit PSEG at:
www.pseg.com
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CONTACT:
Media Relations
Marijke Shugrue
862-465-1445 
Marijke.Shugrue@pseg.com

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SOURCE Public Service Electric & Gas Company (PSE&G)

FAQ

What is PSE&G's Summer Relief Initiative and when does it start?

PSE&G's Summer Relief Initiative includes a Summer Moratorium from July 1 to September 30, 2025, providing utility shut-off protection for low-income customers and suspension of reconnection fees.

How much are PSE&G electric rates increasing in June 2025?

PSE&G electric rates are increasing by 17% starting June 1, 2025, due to PJM's capacity price auction results.

What assistance programs does PSE&G offer for customers struggling with bills?

PSE&G offers LIHEAP, SHARES for temporary financial crisis, Equal Payment Plan for levelized monthly payments, and Deferred Payment Arrangements for past-due balances.

Why is PEG stock affected by the electric rate increase?

The rate increase reflects regional power supply-demand challenges and while PSE&G will defer customer payments, they must still pay suppliers in full, potentially impacting company finances.

How does summer heat affect PSE&G customer electricity bills?

Electricity needed to cool a house to 75 degrees increases by 125% when outside temperature rises from 85 to 90 degrees, significantly impacting summer electricity usage and bills.