At Utilities event, many explanations for rising rates but few solutions on how to control them

MORRISTOWN - The opening act of the 2025 N.J. Utilities Association Conference brought a lot of big names to talk about the biggest issue in the industry: The explosion of cost on utility bills that is coming next month and in the coming years.

And while Stu Bressler, executive VP of market services and strategy at PJM, and Christine Guhl-Sadovy, president of the N.J. Board of Public Utilities, offered insights on a panel of industry experts, the group was not able to provide the ultimate answers to why this is happening (perfect storm of events), when will it slow (not anytime in the near future) and what can be done (it’s complicated).

Bressler offered a straight-to-the-facts supply-and-demand explanation.

“We’re seeing retirement of existing supply resources and then explosive load growth and simultaneously a relatively slow pace of resources coming on the system to replace the retirement and to serve that additional load,” he said.

“And the resources that are coming onto the system right now are primarily renewable, which are great — and we want all of them — but they don’t quite have the same reliability attributes of the more fossil-fuel generation resources that are actually retiring these systems.

“We’re seeing this sort of confluence of events. As a result, the system is getting tight from a resource adequacy perspective — and when supply goes down and demand goes up under a market construct, or really any construct, prices tend to go up.”

It’s a simplified response — and not one that satisfied an overflow crowd of hundreds gathered at the Hyatt Regency in Morristown.

Guhl-Sadovy acknowledged that BPU has been blamed for the rising prices but pushed back.

“We know that market conditions drive up prices, and that last year’s auction results were a significant implication of the need for more resources,” she said. “I think where we somewhat differ is actual supply and demand versus some artificial scarcity on how the auction results played out.”

Guhl-Sadovy said the state’s efforts in solar and, especially, offshore wind, are not producing the desired additional generation, but she said the issue doesn’t stop and start there.

“The fact of the matter is, a significant number of resources were not bid into the market last year,” she said. “So, certainly no argument from the BPU that we need more generation resources. I think there’s certainly some discussion about what those resources should look like, where they should come from, and what their emissions profiles should or should not be.

“But there were definitely resources that were not bid into the market, that did produce, that did run, that did generate electricity, that were not incorporated, and so therefore there was some contribution, I think, from artificial scarcity to the driving up of that price.”

What does this all mean going forward?

The other panelists — Brian Lipman (NJ Ratepayer Advocate), Amber Perry (Exelon), Joe Accardo (PSEG) and Abigail Philips (JCP&L) — tried to fill in the gaps.

Utilities, after all, will bear the brunt of customer complaints in the coming weeks (when bills jump 20%) and the coming months and years (when they don’t go back down).

Perry said maintaining reliability and resilience needs to be done in an affordable way, with innovative and creative partnerships across the industry.

She highlighted the benefits of “budget billing,” in which the cost is spread throughout the year so there is no summer peak. She also discussed the importance of smart meters to help customers manage their usage to control costs.

Perry also said there are programs to extend payments from 12 to 24 months and the waiving of certain fees for customers.

“There is money in customers’ pockets if they know a program is available for residential and commercial to sign up for incentives and rebates,” she said. “We need to remove hurdles so they can get online and enroll.”

Of course, that doesn’t solve the long-term issue of a need for more power generation to satisfy a huge increase in demand.

Accardo said, no doubt, that New Jersey needs more power generation – and touched on another sensitive topic with long-term implications: Should rules and regulations be changed so that the utilities themselves can get back into the generation business?

“How are we going to take our destiny into our own hands?” he asked.

Accardo said we are all “beating each other up too much” and that the state needs to focus on investing in reliability for customers.

He also noted the nature of the industry — and how quickly present-day needs (when severe weather hits the state, causing outages) overtake long-term planning in the minds of customers.

Philips said concerns of the future must incorporated into the present and wondered whether this price explosion offers an opportunity.

“This is tremendous economic opportunity for the state, if we can figure out a way how to moderate the costs and the rates and to figure out the aspects of generation that have long lead times,” she said.

Philips said New Jersey has just seen the beginning of utility increases, as infrastructure in New Jersey needs to handle the demand growth. The time to act is now, she said.

“Our infrastructure needs to be maintained to provide our communities the energy they need,” she said.

Lipman, part of an independent state agency that represents the interests of consumers in matters related to utility services and insurance, said one universal truth in all of this: Demand — or demands — is the chief concern of customers.

He said ratepayers want New Jersey utilities to invest and build, but, candidly, “(they) don’t want to pay for it.”

Lipman said the system needs a smart construct to control price fluctuations.

Rising costs — and rising reactions to these costs — are coming, Lippman said.

He said people already are debating about what they will choose: Buying medications, paying rent or paying for utilities.

“People are making these decisions,” he said.