Why It Matters
New Jersey regulators approved programs designed to reduce peak electricity demand and expand battery storage. The actions seek to curb electricity-cost spikes associated with artificial intelligence data centers.
What Happened
The New Jersey Board of Public Utilities unanimously approved an interim virtual power plant program and the next phase of the state’s energy storage program. Together, the initiatives make up PowerUp New Jersey.
The virtual power plant program will compensate reductions in electricity use or energy sent to the grid from stored power. Participating resources may include smart devices, in-house batteries, solar panels and other energy sources.
Virtual power plants remotely manage equipment during periods of highest grid demand. Examples include adjusting smart thermostats and controlling electric vehicle chargers. Participants may receive payments directly from their utility or through a distributed energy resource manager.
Gov. Mikie Sherrill said residents and businesses could provide energy from their homes through “smart devices, in-house batteries, solar panels, and other energy sources” and receive payment for supporting the grid.
The board also approved block one of the second phase of New Jersey’s energy storage program. The phase expands residential battery storage, with payments available to individuals and businesses participating through a distributed energy resource manager.
By the Numbers
3% — targeted peak energy-use reduction at each of four regulated utilities.
82% — potential share of targeted reductions from existing eligible devices.
Three-quarters — share of eligible devices assumed to be enrolled for the 82% reduction.
547.1 megawatts — overall reduction sought across four electric distribution companies.
Oct. 1, 2027 — deadline for utilities to establish interim virtual power plant programs.
Sept. 30, 2029 — end date for interim virtual power plant programs.
$200 per kilowatt — payment for new residential or small-scale commercial storage capacity.
$100 per kilowatt — payment for existing storage capacity joining the program.
150 megawatts — new storage sought in block one.
100 megawatts — existing storage sought in block one.
2,000 megawatts — New Jersey energy storage capacity target by 2030.
Zoom Out
The program applies across four electric distribution companies, including PSE&G and Atlantic City Electric. Its design combines demand management with distributed storage rather than relying only on utility-scale resources.
Emma Rebhorn, a Board of Public Utilities commissioner, said the most expensive hours of the year drive unsustainable increases in utility and electricity bills.
What’s Next
The four regulated utilities must establish interim virtual power plant programs by Oct. 1, 2027. Those programs will operate through Sept. 30, 2029, before permanent versions replace them.