FERC Rejects PJM Settlement, Saving PSE&G Customers $100M+ in Transmission Costs

Event summary

  • FERC rejected a proposed settlement on March 6, 2026, that would have disproportionately allocated transmission costs to PSE&G customers.
  • PSE&G was the only utility in PJM to oppose the settlement, which FERC found to be unjust and discriminatory.
  • The decision will result in approximately $100 million in refunds for PSE&G customers for the years 2020-2022, with additional savings expected from recalculations dating back to 2015.
  • PSE&G, along with NJ BPU and NJ Division of Rate Counsel, filed multiple pleadings opposing the settlement.

The big picture

FERC's decision underscores the growing scrutiny over transmission cost allocation within PJM, a regional transmission organization managing the electric grid in 13 states. PSE&G's successful opposition highlights the strategic importance of regulatory advocacy in managing operational costs. The ruling could influence future cost-sharing mechanisms and regulatory oversight in the energy sector, particularly as utilities navigate the complexities of grid modernization and rate setting.

What we're watching

Cost Allocation Impact
How the recalculation of cost assignments dating back to 2015 will affect the total savings for PSE&G customers.
Regulatory Dynamics
Whether FERC's decision sets a precedent for other utilities in PJM to challenge similar cost allocation proposals.
Customer Relations
The pace at which PSE&G can communicate and distribute the refunds to its customers, enhancing trust and satisfaction.

Related topics

Utilities