Governor Phil Murphy has commended a recent agreement between Pennsylvania and PJM Interconnection that aims to prevent $21 billion in price increases for consumers across the 14 jurisdictions served by PJM, including New Jersey. This development follows a period of historic electricity price surges due to market rule flaws, with prices rising up to tenfold in PJM's last capacity auction.
In October, Governor Murphy, alongside governors from Pennsylvania, Illinois, Maryland, and Delaware, called for urgent measures to address the record-high electricity prices. Their efforts led to a complaint by Governor Josh Shapiro filed with the Federal Energy Regulatory Commission (FERC) against PJM. As a result of these actions and subsequent letters from founding member governors criticizing the auction flaws, PJM agreed to implement a price cap expected to save consumers $21 billion over two years.
Governor Murphy expressed satisfaction with this outcome: “I am pleased that PJM did the right thing by finding a path forward that will save consumers billions of dollars on their energy bills.” He emphasized New Jersey's ongoing commitment to advocating for consumer affordability and working with partner states to ensure accountability.
New Jersey is actively pursuing policies aimed at increasing in-state power generation and meeting resource adequacy needs. These initiatives are intended to reduce electricity costs for ratepayers. Recently, Governor Murphy urged PJM to address escalating energy costs through long-term solutions such as aligning market planning processes with state policymaking and expediting interconnection timelines for new generation projects.
Christine Guhl-Sadovy, President of NJBPU, stressed the importance of continued efforts: “Affordability is always top of mind and we will continue fighting for New Jersey ratepayers.” She highlighted the need for improvements in market rules and interconnection queue times.
Rate Counsel Director Brian Lipman also noted progress but acknowledged further work is necessary: “This appears to be a good step that will likely help reduce exposure to high electricity prices for New Jersey ratepayers... We encourage FERC to approve additional structural changes.”
The agreement marks an initial step towards addressing regional cost challenges while emphasizing the need for ongoing reforms in market design and policy integration.
