NJ — Power Infrastructure Updated 2026-07-17

New Jersey

PJM Natural Gas Nuclear Solar Wind Storage Data Center PPAs Queue Bottlenecks Transmission Constraints

1) Grid operator and market structure

  • RTO/ISO: New Jersey is fully within PJM Interconnection’s footprint; PJM’s New Jersey infrastructure report treats New Jersey transmission planning, interconnection requests, and RTEP investment as part of the PJM regional planning process (PJM New Jersey State Infrastructure Report, 2025-06).

  • Retail market: New Jersey remains a restructured retail market in which the supply portion of electric service is open to third-party competition while utilities continue delivery service over wires and pipes (NJBPU Shop for Energy Suppliers, 2026-06-10).

  • Basic Generation Service (BGS) context: NJBPU certified the 2026 BGS auction results on February 12, 2026 for supply beginning June 1, 2026; BPU said winning prices increased slightly versus the prior year and were driven largely by wholesale energy and PJM capacity market costs, with the 2026 auction securing about 7,600 MW of customer requirements (NJBPU BGS auction release, 2026-02-12).

2) Interconnection queue (status, depth, wait times, reforms)

  • New Jersey generation queue: PJM’s state report for New Jersey lists 18,270 MW of interconnection requests in New Jersey as of May 7, 2025, led by offshore wind and storage, with PJM-wide queued capacity at 158,260 MW (PJM New Jersey State Infrastructure Report, 2025-06).

  • 2026 load forecast recognizes data-center load in New Jersey zones: PJM’s January 2026 load forecast adjusts JCPL for data-center load and the PS zone for data-center load plus port electrification (PJM 2026 Load Forecast Report, 2026-01).

  • PSE&G data-center adjustment is now material: PSE&G’s January 2026 PJM load-forecast adjustment reported 39 data center sites with 394 MW summer peak demand in 2025 and projected data-center customer demand in the PS zone rising to 785 MW in summer 2026, 3,084 MW in summer 2031, and 3,461 MW in summer 2046 (PSE&G Load Forecast Adjustments, 2026-01).

  • PJM tightened near-term large-load treatment: PJM said its 2026 forecast lowered near-term peak demand versus the 2025 forecast because of updated economics, EV assumptions, and improved vetting of data-center and large-load adjustment requests, including firm/non-firm distinctions designed to reduce double-counting risk (PJM Inside Lines, 2026-01-14; PJM 2026 Load Forecast Report, 2026-01).

  • BPU distribution interconnection RFI: On February 4, 2026, NJBPU issued an RFI to the four electric distribution companies on accelerating distributed energy resource interconnection, hosting-capacity maps, constrained circuits, energy storage interconnection, smart inverters, and flexible interconnection protocols; the release explicitly links grid modernization to rising demand from data centers (NJBPU RFI release, 2026-02-04).

  • PJM generation-queue fast track approved: FERC accepted PJM’s temporary Expedited Interconnection Track on June 9. Through 2027, PJM may study up to 10 state-supported, shovel-ready generation projects per calendar year that provide at least 250 MW of accredited unforced capacity and can reach commercial operation within 36 months; the reform accelerates potential supply rather than creating a data-center load-interconnection right (FERC order, 2026-06-09).

  • Federal large-load proceedings now govern PJM’s next reforms: On June 18, FERC opened PJM Docket EL26-67 and ordered PJM and its transmission owners, within 60 days, either to justify existing tariffs or propose reforms addressing large-load studies, cost shifting and transparency, co-location, flexible service, and nearby generation; FERC also required a generation-adequacy informational report within 30 days. Those responses were still pending at the July 17 cutoff (FERC, 2026-06-18).

  • PJM is developing a Connect and Manage option for flexible loads: PJM’s active stakeholder work would let large new loads, including data centers, connect before all ordinary upgrades are complete if they accept operational flexibility and pre-emergency curtailment to protect other customers; it remained a framework under development rather than an effective tariff at the cutoff (PJM Connect and Manage Senior Task Force, 2026-03-25; PJM Interconnection, 2026-07-14).

3) Ratepayer protection (large-load tariffs, cost allocation, BPU orders)

  • Data Center Fair Share became law, but the implementing BPU order and tariffs are not yet due: Governor Sherrill signed A796/S731 as P.L.2026, c.32 on July 7. BPU has 12 months to issue standards and define “large data center” at a threshold of at least 50 MW; utilities must file a separate class or tariff within 180 days after the BPU order. No implementing tariff could therefore be treated as final at this cutoff (A796 fourth reprint, 2026-06-18; Governor Sherrill signing release, 2026-07-07; A796 status, 2026-07-07).

  • The law specifies cost allocation and customer-commitment protections: BPU’s standards must prevent other customers from subsidizing large data centers, assign data-center-related infrastructure and stranded costs to the class that causes them, screen duplicate service requests, use financial guarantees and minimum billing commitments, and address co-located generation. Some financial-guarantee provisions do not apply to capacity approved for service before the law’s effective date, while pending requests must comply with the new framework (A796 fourth reprint, 2026-06-18).

  • The law includes PJM-facing load controls: Utilities must submit Large Load Adjustments and Peak Shaving Adjustments to the RTO, report annually, and curtail large data centers before residential customers during emergencies except for designated critical load. It also authorizes a retail demand-reduction mechanism outside PJM through which large loads can offset capacity obligations by paying for reductions elsewhere on the system (A796 fourth reprint, 2026-06-18; Governor Sherrill signing release, 2026-07-07).

  • A2770 provides a separate surcharge model: A2770 remained in Assembly Telecommunications and Utilities as of July 17; it would define large load data centers at 50 MW monthly demand, require peak-demand surcharges approved by BPU, and deposit surcharge revenue into a BPU Grid Modernization Fund (A2770 introduced text, 2026-01-13; A2770 status, 2026-07-17).

4) Generation adequacy (major projects, storage, shortfall concerns)

  • Existing resource mix: PJM reports New Jersey installed capacity as 69% natural gas and 26% nuclear, making thermal and nuclear resources central to near-term adequacy even as the interconnection queue is dominated by offshore wind and storage (PJM New Jersey State Infrastructure Report, 2025-06).

  • RTO-wide growth remains historically high: PJM’s 2026 report forecasts PJM RTO summer peak load growth averaging 3.6% per year over 10 years and 2.4% over 20 years, with summer peak reaching 253,077 MW in 2046; PJM’s public summary states the growth rate is much higher than recent decades and is driven in large part by data-center and large-load additions (PJM 2026 Load Forecast Report, 2026-01; PJM Inside Lines, 2026-01-14).

  • 2028/29 capacity auction cleared short of the reliability requirement: PJM’s July 14 auction procured 138,318 MW UCAP, plus 10,864 MW under Fixed Resource Requirement plans, leaving the region 6,831 MW below its reliability requirement. The price cleared at the FERC-approved $325/MW-day cap, the cleared-supply value was $16.4 billion, and only 525 MW UCAP of new generation or uprates cleared; PJM specifically cited continued additions of large data-center loads to the forecast and said it would seek a September backstop procurement (PJM Interconnection, 2026-07-14).

  • State policy response includes storage and in-state resources: Governor Sherrill’s May 27 data-center plan links data-center guardrails to broader affordability actions, including approval of large-scale solar and battery storage projects, a community-solar expansion to 3,000 MW, battery-storage legislation, and the lifting of the 50-year moratorium on new nuclear energy (Governor Sherrill press release, 2026-05-27).

  • Power NJ Act starts a new-nuclear procurement: Governor Sherrill signed A4881/S4296 on July 13, directing BPU and NJEDA to establish a competitive process for at least 1,100 MW of new nuclear generation. The law requires a net ratepayer benefit, federal financing, public participation, and protection from construction costs and overruns; the first request for expressions of interest is due within 180 days (Governor Sherrill signing release, 2026-07-13). This is a broader adequacy measure rather than a data-center entitlement, although the legislation’s findings identify data-center growth as a major demand driver (S4296 first reprint, 2026-06-18).

  • SMR-powered AI data center fast-track proposal: S3639, introduced February 24 and still in Senate Economic Growth on July 17, would require BPU, DCA, and DEP to adopt expedited approval and permitting procedures for AI data centers powered by on-site small modular reactors (S3639 introduced text, 2026-02-24; S3639 status, 2026-07-17).

5) Utility load forecasts and IRP context

  • PJM forecast is the key public planning document: Because New Jersey has competitive generation supply and regulated delivery service, the most explicit public evidence of data-center-driven load growth is PJM’s long-term load forecast and supporting utility adjustment documents rather than vertically integrated utility IRPs (NJBPU Shop for Energy Suppliers, 2026-06-10; PJM 2026 Load Forecast Report, 2026-01).

  • PSE&G forecast detail should be monitored: PSE&G’s data-center forecast includes existing sites, expansions, new service requests, and feasibility requests, with completion assumptions of 100% for existing expansions and new service requests and 50% for feasibility requests; it also notes additional inquiries not included in the forecast, including 2,000 MW in capacity-review requests and 3,600 MW in potential leads (PSE&G Load Forecast Adjustments, 2026-01).

  • BPU’s FY2027 planning orders acknowledge the step-change in load: In approving FY2027 clean-energy program budgets on June 30, BPU cited a projected 20% increase in New Jersey peak demand by 2030 relative to 2024, driven substantially by data centers, as part of the planning context for efficiency and resource acquisition (NJBPU FY2027 compliance-filings order, 2026-06-30).

  • A3980 would create broader load-capacity disclosure: The Powering Up New Jersey Act was reported as an Assembly Committee Substitute on June 4 and remained in Assembly Science, Innovation and Technology on July 17; it would require utilities to file distribution hosting-capacity and load-capacity mapping, energization targets, flexible interconnection or energization tariffs, and infrastructure plans with BPU (A3980 Assembly Committee Substitute, 2026-06-04; A3980 status, 2026-07-17).

6) Behind-the-meter, co-location, and direct PPAs

  • Vineland/DataOne-Nebius highlights behind-the-meter interest: Nebius said its New Jersey DataOne project would use behind-the-meter electricity and advanced energy technology, with the New Jersey site expandable to 300 MW (Nebius, 2025-03-05). Pinelands Alliance reported DataOne’s January 2026 town-hall statements that the Vineland project would use natural-gas engines for most operations and a water-reuse/condensation approach, while residents raised noise, environmental, health, and energy-price concerns (Pinelands Alliance, 2026-02-11).

  • New state law regulates co-located generation treatment: P.L.2026, c.32 directs BPU standards to create tariff treatment for co-located generation, assess the capacity value of such resources, prioritize interconnection for clean generation or demand-reduction commitments, and prevent evasion through behind-the-meter or off-tariff arrangements (A796 fourth reprint, 2026-06-18).

  • FERC set interim PJM transmission-service rules and required further compliance: In Docket EL25-49, FERC’s June 18 order established certain rates, terms, and conditions for new PJM transmission services associated with co-located load, accepted and rejected PJM’s earlier compliance filing in part, and directed PJM and its transmission owners to make further filings within 60 days (FERC June meeting summary, 2026-06-18).

7) Transmission constraints and upgrades

  • RTEP investment levels in New Jersey: PJM’s New Jersey infrastructure report lists $1.557 billion in total RTEP project investment in New Jersey, combining baseline, network, and supplemental projects (PJM New Jersey State Infrastructure Report, 2025-06).

  • Advanced Grid Technologies Act adds state review of supplemental transmission: S4411/A5188, signed July 7, requires a state certificate of public convenience and necessity before supplemental transmission construction, with a 180-day standard track and 120-day fast track for projects using advanced transmission technologies. The Governor’s supporting materials report $14.7 billion in New Jersey supplemental-project spending from 2008-2025 and frame the law as a cost-control and grid-capacity measure relevant to growing loads (Governor Sherrill signing release, 2026-07-07).

  • State-level local/load planning is becoming more explicit: A3980’s proposed hosting-capacity and load-capacity maps and BPU’s February RFI address distribution visibility, while the now-enacted A796 large-load-adjustment requirements will move data-center-relevant forecast information into state utility filings as BPU implements the law (A3980 Assembly Committee Substitute, 2026-06-04; NJBPU RFI release, 2026-02-04; A796 fourth reprint, 2026-06-18).

8) Water/energy reporting and environmental-grid interface

Gaps and follow-up targets

  • BPU implementation dockets: Track the new P.L.2026, c.32 standards docket and subsequent utility tariff filings; A2770, A3980, and S3379/A4096 had not become law at this cutoff.

  • Project-specific interconnection and tariff evidence: Public PJM load forecasts identify zonal load growth, but project-level interconnection studies, customer agreements, and utility extension costs remain largely unavailable in public sources.

  • Local power arrangements: Vineland/DataOne shows how quickly behind-the-meter generation can become central to local permitting debates; future updates should track air permits, water approvals, and BPU/PJM filings for that and other South Jersey projects.