Powering Up New Jersey

New Jersey's electrical grid is over one hundred years old, with some components built in the 1800s. This grid's aging infrastructure, combined with insufficient maintenance can lead to increased power outages, delays in meeting customer requests for additional electric service, and more expensive rates as operational costs increase.

While public officials and residents recognize the need for grid improvements, New Jersey's current regulatory framework often slows down necessary grid upgrades. To address these challenges, the state needs a proactive, modern regulatory approach that ensures all New Jerseyans benefit from strategic grid planning and investments.

Making a Good Bill Great

Last year, New Jersey State Senator Bob Smith introduced Bill S258 to modernize the aging electrical grid, and it passed in the Senate Environment Committee in March. While this is a good start, a diverse coalition of stakeholders - including labor, industry, environmental, and public health advocates - are calling for amendments to strengthen the bill. To grow New Jersey's economy, meet air quality standards, and achieve its climate goals, we must modernize the electric grid and the regulatory framework governing it. Utility regulators need to account for the increasing demand for electricity to power everything from cars, trucks, buses, buildings and appliances, and distributed energy technologies like solar panels, stationary battery storage, and vehicle batteries that can support the operation of the grid.

By incorporating these proposed amendments, we can ensure the grid is equipped to deliver reliable electricity, reducing the frequency and duration of power outages from winter storms and extreme weather events, like Superstorm Sandy or Hurricane Ida.

And updating the grid to support the electrification of buildings and vehicles can put downward pressure on electric rates to the benefit of all utility customers. A study by Synapse Energy Economics found that over the past eleven years, EV drivers in New Jersey contributed $85 million more on their utility bills than associated costs, resulting in net-revenue that is returned to all customers in the form of rates that are lower than they otherwise would be.

Specifically, the amendments to S258 will accomplish the following:

• Align Infrastructure Planning with State and Federal Law: Require utilities to update their planning processes to line up with state and federal transportation and building electrification policies and requirements.
• Support Make-Ready Infrastructure: Direct utilities to cover the reasonable costs of utility-side equipment, such as the wire from a transformer to the customer meter, needed to energize EV charging stations.
• Promote Advanced Technologies: Encourage the use of innovative technologies and practices, including load management and distributed energy generation like solar.
• Establish Energization Timelines: Set target timelines for utilities to provide service to new electrification loads and distributed energy resources.
• Create Rates Designed for EV Charging: Direct utilities to develop EV charging rates that account for the unique attributes of vehicle charging and increase fuel cost savings for those who charge in a manner that supports the grid.
• Support Workforce Development: Require utilities to maintain a workforce and strong apprenticeship programs that ensure sufficient staffing levels to upgrade and maintain the grid.
• Enhance Transparency: Require transparency, public input, and regulatory oversight in utility operations.

More EVs = Savings for Everyone

Accelerating the modernization of New Jersey's aging grid will ensure utility customers receive the electric service they need when they need it, enabling the use of electric cars, trucks, and buses, and efficient appliances that can save billions of dollars in fuel costs. Right-sizing and future-proofing grid investments will yield cost savings for all utility customers. For example, real-world data shows that building one 8-megawatt substation sized to accommodate expected future truck charging demand can halve total costs compared to multiple, incremental upgrades. The suggested amendments also require utilities to avoid grid upgrades whenever it is less costly to invest in load management and non-wires alternatives.

The suggested amendments will also ensure all utility customers benefit sooner rather than later. By fostering beneficial electrification, we can spread grid maintenance costs over more kilowatt-hours, lowering the price per kilowatt-hour for all customers. This phenomenon has already been observed in the real-world in New Jersey, as documented by Synapse Energy Economics. The suggested amendments will ensure beneficial electrification keeps putting downward pressure on rates to the benefit of all customers and will allow the state to meet its climate, air quality, and equity goals.

Now is the Time to Act

Reliable, affordable, and clean electricity is essential for New Jersey's future. To achieve all of these goals, the state must modernize its electrical grid and its utility regulatory practices. By embracing appropriate planning and leveraging existing and new technologies and equipment, we can enhance service reliability, reduce outages, put downward pressure on electric rates, and help New Jerseyans get off the rollercoaster of gasoline prices that spike unpredictably. The time to act is now.

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