PSE&G Proposes New Solutions To Help Customers Dealing With Upcoming Energy Price Increases

Rhea-AI Summary

PSE&G (PEG) has filed an amended proposal with the New Jersey Board of Public Utilities to provide additional relief for customers facing significant electric supply cost increases due to PJM's high capacity market prices. The company proposed three key short-term solutions: expanding the Winter Termination Program, suspending reconnection fees, and removing carrying charges for temporary credits starting July 1, 2025. PSE&G's current customer assistance programs have helped 226,000 customers receive over $265 million in support, with their energy efficiency initiatives saving participants nearly $640 million annually. The company maintains that bills remain nearly equivalent to 2008 levels when adjusted for inflation and emphasizes its commitment to working on long-term solutions, including encouraging new generation development to address supply-demand imbalances in the PJM region.

Positive

• Over 415,000 customers benefited from energy efficiency programs, saving $640 million annually
• 226,000 customers received more than $265 million in support and assistance
• Bills remain nearly equivalent to 2008 levels when adjusted for inflation
• Company won ReliabilityOne Award for 23 consecutive years
• Ranked #1 in customer satisfaction for residential electric and gas service in the east

Negative

• Significant increases in electric supply costs due to PJM's high capacity market prices
• Supply and demand imbalance in the PJM region affecting rates
• Approximately 100,000 eligible customers haven't accessed available assistance programs
• Need for more generation capacity to address long-term supply issues

Insights

Utility Regulation Specialist

PSE&G proposes customer relief measures for upcoming rate increases while maintaining financial stability through balanced regulatory approach.

In this filing update, PSE&G is taking proactive measures to address the looming electricity price increases stemming from PJM's capacity market auction results, while carefully balancing customer affordability with financial prudence. The company is responding to direct requests from Governor Murphy with three key short-term solutions: expanding the Winter Termination Program for vulnerable customers, suspending reconnection fees, and voluntarily removing carrying charges on proposed temporary credits.

What's particularly noteworthy is that PSE&G previously filed three credit options with the BPU on May 7th - offering 100%, 50%, or 25% offsetting credits to mitigate the summer bill increases. The voluntary removal of carrying charges represents a financial concession by PSE&G, as these charges typically compensate utilities for the time value of money when deferring collections.

The company has identified a clear underlying cause for these increases: the supply-demand imbalance in the PJM region that resulted in high capacity prices from the July 2024 auction. This suggests a structural market issue rather than a company-specific problem.

Despite these temporary measures, PSE&G maintains a strong record on affordability, with current bills nearly equivalent to 2008 levels when adjusted for inflation. Their customer assistance programs reached approximately 226,000 customers with over $265 million in support last year, while their energy efficiency initiatives have delivered nearly $640 million in annual savings for participants. The company has strategically positioned itself as partnering with regulators and government on solutions while emphasizing that as a delivery utility, they aren't the cause of the underlying price increases.

PSE&G files updated proposal to offer additional short-term assistance, while standing ready for long-term solutions

NEWARK, N.J., May 15, 2025 /PRNewswire/ -- PSE&G today announced that it is amending its May 7, 2025 filing with the New Jersey Board of Public Utilities (BPU) to provide additional short-term relief for mitigating the impact of recent significant increases in electric supply costs caused by PJM's high capacity market prices. In the filing, PSE&G is responding to requests for temporary solutions from Gov. Phil Murphy issued in a press release yesterday, in addition to a one-time waiver of carrying costs for credits that might be issued this summer, pending BPU action.

"As Gov. Murphy said yesterday in his press release, utilities are not the cause of the unexpected rise in utility rates, but we have a role to play in providing options to assist our customers," said Kim Hanemann, president and COO, PSE&G. "PSE&G works closely with our customers and communities to help ensure they have access to programs that fit their needs to manage their bills. We will continue to work with policymakers on short-term solutions to assist our customers while working with the state on long-term solutions, including the need for more generation."

For decades, PSE&G has worked with customers, and with nonprofits and community organizations who work with utility customers, to raise awareness, educate and inform customers about energy assistance options. In recent years, PSE&G has participated in hundreds of events across the state and communicated directly to customers through the mail and online about the programs and support available to help manage bills.

Short-term solutions filed with the BPU
In response to requests made in Gov. Phil Murphy's May 14 press release, and as they relate to the May 7 BPU filings he noted in his press release, PSE&G requests the BPU approve:

• The implementation of an expansion of the Winter Termination Program, which provides utility shut-off protection to low-income and vulnerable individuals.
• The suspension of reconnection fees.
• The voluntary removal of its carrying charges for a temporary credit beginning on July 1, 2025 to offset the electric bill increases that will occur this summer. Carrying charges are the cost that the company will incur when delaying collection of the supply cost increase PSE&G pays to the suppliers.

PSE&G is proud of its track record of maintaining customer affordability and award-winning reliable service. PSE&G bills are nearly equivalent to 2008 levels when adjusted for inflation. PSE&G works hard to keep customer bills as low as possible and this has resulted in PSE&G being a top performer nationally in affordability.

May 7 filing with the BPU

In compliance with the BPU's order dated April 23, 2025, PSE&G's May 7 filing describes options for the creation of a Temporary Supply Offset Clause ("TSOC"), a temporary credit beginning on July 1, 2025 to offset the electric bill increases that will occur this summer, bill increases that largely stem from the July 2024 PJM Base Residual Auction. As indicated in the May 7 filing, the three options included a 100% offsetting credit, a 50% offsetting credit and a 25% offsetting credit, which were based on guidance from BPU Staff. 

Long-term solutions needed

While PSE&G has been warning for several years about the supply and demand imbalance in the PJM region, we remain committed to working with stakeholders in government regarding long-term solutions to these significant rate increases, including policy and legal changes to encourage the development of new generation.

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. These efforts are designed to provide access to information on a range of energy efficiency and affordability offerings – from rebates and discounts to programs for small businesses and corporations.

PSE&G's energy efficiency programs provide free assessments to help make customer's homes or businesses more efficient, and lower energy use year-round. As of this past February, over 415,000 customers benefitted from programs that reduced energy consumption and lowered bills. On an annual basis, participants saved nearly $640 million.

Last year, PSE&G made improvements to better identify and reach customers who are most likely eligible for energy assistance programs and affordability options. In the end, approximately 226,000 customers received more than $265 million in support and assistance from these and other outreach initiatives. We estimate that another 100,000 customers are eligible for these programs but have yet to reach out.

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.

PSE&G is promoting affordability and bill management programs in person through its customer service centers and call center, while also educating customers through a multichannel communication that includes bilingual emails, social media, newsletters, bill inserts, direct mail, media interviews and webinars and events with our community partners. Customers can also find valuable energy assistance information at pseg.com/saveenergy and bizsave.pseg.com.

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 solutions is PSE&G (PEG) proposing to address energy price increases in 2025?

PSE&G is proposing to expand the Winter Termination Program, suspend reconnection fees, and remove carrying charges for temporary credits starting July 1, 2025. They also filed options for a Temporary Supply Offset Clause with 100%, 50%, and 25% offsetting credit options.

How many PSE&G customers received financial assistance in 2024?

226,000 PSE&G customers received over $265 million in support and assistance through various outreach initiatives and energy assistance programs.

What is the annual cost savings for PSE&G customers from energy efficiency programs?

PSE&G's energy efficiency program participants saved nearly $640 million annually, with over 415,000 customers benefiting from programs that reduced energy consumption.

How does PSE&G's 2025 pricing compare to historical rates?

PSE&G bills are nearly equivalent to 2008 levels when adjusted for inflation, demonstrating the company's efforts to maintain customer affordability.

What payment assistance programs does PSE&G offer to customers?

PSE&G offers the Low Income Home Energy Assistance Program (LIHEAP), SHARES for temporary financial crisis, Equal Payment Plan for levelized monthly payments, and Deferred Payment Arrangements for past-due balances.