New Jersey Assembly Bill AJR216

New Jersey 2024-2025 Regular Session

• Introduced: 2/20/25
• Refer: 2/20/25
• Report Pass: 5/5/25

Caption

Directs BPU to investigate PJM Interconnection, L.L.C.'s Reliability Pricing Model; directs State to promote affordable energy practices and to urge PJM Interconnection, L.L.C. to implement certain reforms.

Impact

The proposed investigation into PJM's Reliability Pricing Model is expected to have considerable implications for New Jersey's energy policies. By focusing on the correlation between capacity prices and cost-effectiveness, AJR216 seeks to ensure that any developments in the energy sector are in line with the state's efforts to make energy affordable for all residents. Especially for low-income families, maintaining a balance between reliability and affordability will be critical as energy demands grow over the next decade. Additionally, the bill's direction for investigating market reforms aims to protect consumers from the increasing costs seen in the current auction framework.

Summary

AJR216 is a joint resolution introduced in the Legislature of New Jersey that directs the Board of Public Utilities (BPU) to investigate PJM Interconnection, L.L.C.'s Reliability Pricing Model. This resolution emphasizes the importance of maintaining adequate resources on the electricity grid while ensuring that costs are kept as low as possible for ratepayers. With the rising costs associated with PJM's capacity market auctions impacting consumers, this investigation aims to assess if these costs align with the principles of affordability and transparency highlighted in New Jersey's Electric Discount and Energy Competition Act. The resolution also calls for collaboration with neighboring states to promote affordable energy practices.

Contention

While the bill is intended to promote energy affordability and sustainability, there may be points of contention among stakeholders. Some industry advocates might argue that reforming PJM's pricing model could disrupt current market operations, potentially leading to short-term challenges in resource allocation. There might also be concerns about how effectively these reforms can be implemented given the complexity of energy markets and the various stakeholders involved. The resolution, while well-intentioned, may face scrutiny from those worried that it could alter the balance in a way that disproportionately affects certain regions or energy suppliers.