Why Are New Jersey Electric Bills Increasing?

Updated November 9, 2026 | Electricity Rates & Home Energy

If your New Jersey electric bill seems higher than it used to be, you're not alone. Electricity costs have become a major concern for homeowners across the state, with changes in wholesale energy prices, power-grid costs, and regional demand affecting what customers pay.

But what's actually causing these increases? And what can homeowners do to gain more control over their electricity expenses?

What Happened to New Jersey Electricity Rates in 2025?

In February 2025, the New Jersey Board of Public Utilities (NJBPU) announced the results of its annual electricity supply auction.

The results projected average monthly residential electric bill increases ranging from approximately 17% to 20%, depending on the utility service territory, beginning in June 2025.

For a representative household using 650 kilowatt-hours per month, the projected increases were:

Utility

Projected monthly increase

Atlantic City Electric

$28.02

Jersey Central Power & Light

$22.67

PSE&G

$26.87

Rockland Electric

$25.48

These were projections based on the 2025 auction, not guaranteed increases for every household. Actual bills also depend on electricity usage, utility charges, applicable credits, and other factors.

Source: New Jersey Board of Public Utilities, February 12, 2025.

What Changed in 2026?

The results of the February 2026 electricity supply auction were more stable.

For a representative residential customer using 650 kWh monthly, the NJBPU projected the following changes from the auction before credits or offsets:

This is an important distinction. Electricity costs have faced upward pressure, but that doesn't mean every utility or every customer experiences the same increase each year.

Source: New Jersey Board of Public Utilities, February 12, 2026.

Why Are Electricity Costs Under Pressure?

1. Increasing Electricity Demand

Homes, businesses, data centers, and other facilities all require electricity.

As regional electricity demand grows, the power system needs enough generating capacity to meet that demand, including during peak usage periods.

Growing demand can contribute to higher wholesale electricity costs.

2. Power Generation and Capacity Costs

New Jersey participates in the PJM regional electricity market.

PJM coordinates electricity transmission and wholesale markets across multiple states. One part of this system pays power generators for being available when electricity is needed.

Higher capacity-market costs have been an important contributor to electricity supply price pressures in New Jersey.

3. Grid Infrastructure and Delivery Charges

Your electricity bill includes more than the energy itself.

Utilities also maintain equipment and infrastructure required to deliver electricity to homes, including substations, transformers, and distribution lines.

Delivery charges and other approved rates can affect your final bill independently of wholesale electricity prices.

4. Your Household Electricity Consumption

Even when your rate remains unchanged, your bill can increase if you consume more electricity.

Common contributors include:

Understanding both your electricity rate and your monthly usage is essential.

What Can New Jersey Homeowners Do About Their Electricity Costs?

There are several practical ways to take greater control of home energy expenses.

Improve household energy efficiency. Start with LED lighting, weather sealing, insulation, efficient appliances, and smart thermostat settings.

Review your electricity bill. Check your monthly kilowatt-hour consumption, supply charges, delivery charges, and any changes to your rate.

Understand your electricity supply options. Depending on your utility territory, you may be able to compare third-party electricity suppliers. Review contract terms carefully, including rates, renewal provisions, and fees.

Explore residential solar. Solar panels can generate electricity at your home, potentially reducing the amount of electricity purchased from the grid.

Some solar subscription options may offer little or no upfront installation cost and scheduled monthly payments. Payment escalators, utility charges, and contract terms should be reviewed before committing.

Can Solar Help Protect Against Rising Electricity Costs?

Residential solar offers a different approach to meeting part of your household's electricity needs.

Instead of purchasing all your electricity from the utility, solar panels produce electricity using sunlight.

Depending on the system, ownership structure, utility rules, and household usage, solar may reduce electricity purchases from the grid and provide greater predictability for a portion of your energy expenses.

However, solar does not necessarily eliminate your utility bill or guarantee savings. Some subscription agreements include annual payment increases.

For homeowners interested in additional energy resilience, compatible battery storage may also provide backup electricity for selected circuits during outages.

Is Solar Right for Every New Jersey Home?

Not necessarily.

Solar suitability depends on several factors, including roof condition, shading, available sunlight, electricity usage, local utility arrangements, and the cost and terms of the proposed system.

The best way to evaluate your options is to review a proposal based on your specific property and energy usage.

Frequently Asked Questions

Why did New Jersey electric bills increase so sharply in 2025?

The state's electricity supply auction reflected higher wholesale and capacity-market costs, driven in part by increased regional electricity demand and constraints on available generation.

Did New Jersey electricity rates increase again in 2026?

The February 2026 auction produced relatively stable supply prices. The estimated impact varied by utility, with some representative bills increasing slightly and others decreasing before credits.

Will New Jersey electricity prices keep increasing?

Future prices are uncertain. Wholesale energy markets, generation availability, grid investments, regulation, and electricity demand can all influence rates.

Can solar eliminate my electric bill?

Not necessarily. Most grid-connected solar customers continue to receive utility bills. The amount depends on energy consumption, solar production, utility rules, and plan terms.

Take Greater Control of Your Energy Future

Rising electricity costs make it worthwhile to understand all your options.

From improving energy efficiency to exploring residential solar and battery storage, homeowners have ways to evaluate their energy expenses and potentially reduce their reliance on traditional grid electricity.

Interested in learning whether solar could work for your home?

Request a free, no-obligation solar consultation to explore available residential solar options.

Get Your FREE Solar Quote

Solar eligibility, pricing, savings, and available programs vary by homeowner and location. This article is provided for educational purposes by RisingElectricBills.com, an independent solar referral website.


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