NJ lawmakers chide regional power manager for steep hike in electricity prices

Politicians from both sides of the aisle are voicing outrage over Tuesday’s announcement from New Jersey’s electrical grid operator that bills would likely rise as much as an additional 5% next year for ratepayers in the region — on top of this year’s 20% increase.

NJ Democrats slammed grid manager PJM, which dispatches electricity across more than a dozen states, claiming the company’s mismanagement was the leading cause of yet another uptick in consumer costs. Republicans, meanwhile, said the rate hikes are an indication that the energy policies of Gov. Phil Murphy and the Democrats have failed.

PJM announced the results of this year’s capacity auction late Tuesday. The annual energy industry gathering determines what it will cost to keep the lights on for the following year. This year’s price per megawatt day – the amount paid to energy generators per day over the course of the year for every megawatt of energy they’re capable of putting on the grid – landed at $329.17, about a 22% increase from last year.

Stu Bresler, PJM’s executive vice president of market services and strategy, said that would translate into an increase of 1.5% to 5% in customers’ bills next year.

Democratic NJ Rep. Mikie Sherrill, who currently has a lead over Republican Jack Ciattarrelli in the race for governor, said the auction results added “insult to injury” for Garden State residents already facing high electricity bills.

“New Jerseyans across our state have been appalled looking at their utility bills this summer because of PJM’s mismanagement of our energy grid and the subsequent spike in utility costs,” she said, while also taking aim at her opponent, Ciattarrelli, who she said “is doing everything he can to increase [bills] even more.”

“He is fully supporting Trump’s plan to cancel a huge number of new energy projects,” Sherrill said.

Trump’s recently signed tax and spending bill increases U.S. reliance on fossil fuels like oil, coal and natural gas while gutting renewable energy initiatives, specifically around wind and solar. Think tank Energy Innovations’ analysis of Trump’s bill said the legislation would increase utility bills by 5% in New Jersey over the next decade.

Ciattarelli, whom Trump endorsed in the Republican primary, shot back at Sherrill on X, saying energy demand “is outstripping supply because of [Democrats’] political agenda and foolish policies.”

“It’s [Sherrill] and Phil Murphy’s obsession with offshore wind farms & failure to support natural gas & nuclear energy for 8 years that’s driving up our electricity rates,” Ciattarelli posted.

In a statement to Gothamist, Gov. Phil Murphy accused PJM of stalling “critical projects that would create more energy” in New Jersey and creating a system that puts profits for “out-of-state generators” ahead of affordability for consumers.

“Our clean energy goals have always been rooted in lowering costs, increasing reliability, and building energy right here at home. But those efforts have been consistently undermined by [PJM]," Murphy said in a statement, along with Senate President Nicholas Scutari and Assembly Speaker Craig Coughlin.

In April, Murphy accused PJM of “market manipulation.” Murphy also signed onto a letter with nine other governors in the region calling for reforms at PJM, including giving the state officials the opportunity to choose two new board seats to replace recently fired members.

But PJM pushed back on the suggestion that it was solely to blame for the energy cost woes.

“In any market, when demand is up and supply is down, there will be an increase in pricing. PJM has been warning of this eventuality,” spokesperson Daniel Lockwood said in a statement.

Lockwood said PJM has studied and approved 46,000 megawatts worth of new energy generation projects – enough to power about 40 million homes – that have been “slow to construct due to reasons outside of PJM’s control,” including global supply chain, state and federal permitting, and financing challenges.

He added that as of June 2025, there are approximately 63,000 megawatts that will be studied and approved over the next 17 months that PJM hopes will be constructed.

‘This price hike is unacceptable’

Tuesday’s price was the maximum level allowed under a cap that PJM agreed to last year as part of a settlement in a lawsuit brought by Pennsylvania Gov. Josh Shapiro, who said the company had initially sought a maximum of $500 per megawatt day. Bresler said Tuesday’s clearing price would have been substantially higher – at $388.57 – if the cap hadn’t been in place.

“While we are relieved that the negotiated price cap prevented capacity costs from soaring even higher, this price spike is unacceptable,” said Sarah Moskowitz, executive director for Citizens Utility Board, which is a voting member of PJM representing consumers.

Lyle Rawlings, president and CEO of New Jersey-based commercial solar installation firm Advanced Solar Products, told Gothamist that the auction results coming in at the cap price was “unbelievable!”

“Right when people are getting their bills with the increases from [last year’s] auction! I wouldn’t be surprised if this amplifies the political furor,” he said.

Last year’s spike was due in part to last year’s capacity auction, where the price per megawatt day rose from $28.92 to $269.92 for the PJM region, which includes NJ along with Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia and West Virginia. All of the states have starkly different energy needs and policy goals.

New York and New England, for example, have their own grid operators that more closely reflect regional needs and priorities.

Evan Vaughn, executive director for the Mid-Atlantic Renewable Energy Coalition, said the PJM results illustrated the critical need for New Jersey to work to get new energy sources online.

“[The] consumer price increases from PJM’s capacity auction, while regrettable, demonstrate the critical need for New Jersey’s energy policies to bring online high capacity offshore wind and energy storage resources,” he said.

Other New Jersey Senate Democrats criticized PJM.

“Here we go again. Another failed energy auction that will result in another increase in utility bills for New Jersey residents,” said Sen. John Burzichelli in a statement released by Senate Democrats on Tuesday.

The South Jersey Democrat said the price increase is more evidence that the auction process needs to be reformed and the PJM proceedings – which happen behind closed doors – need transparency.

“The latest PJM auction is yet another instance of New Jersey ratepayers being punished for the organization’s negligence,” said state Sen. Andrew Zwicker, a Democrat from Princeton. “Families and small businesses in our state should not be stuck with the bill for decisions made out of the purview of the state’s elected officials by an unaccountable grid operator.”