Gov. Phil Murphy posted on X.com about his June 9 meeting with electricity grid operator PJM Interconnection. Murphy has made PJM the villain in the New Jersey electricity pricing crisis that has become a major political issue in the race to replace the term-limited governor.
Murphy has accused the organization of “shameful” incompetence for failing to connect what he says are 1,500 backlogged energy projects to the grid, a move that he says would significantly relieve the current supply imbalance that is driving up prices. The governor has also asked the Federal Energy Regulatory Commission to investigate PJM for possible market manipulation.
Murphy may not have been the most welcome of visitors, as PJM faces strong political pressure to quicken the rate at which energy projects, many based on solar technology, get access to the 13-state grid that PJM oversees. A number of PJM officials have testified on the energy pricing problems in New Jersey legislative hearings and other forums, essentially placing blame for much of the current set of problems at the feet of the state and its energy programs.
In October Jason Stanek, executive director of government services for PJM, told state legislators that policymakers in New Jersey must not continue to allow power-generating resources to go offline until there is sufficient new generation capacity to replace them.
Murphy said on the X platform that New Jersey stands ready to enact reforms to ensure that states have a much greater say in PJM decisions. “PJM makes choices every day that directly impact our energy supply and costs,” Murphy said. “Every member state deserves a say in those important decisions.”
PJM Interconnection is the oldest and largest of the country’s Regional Transmission Organizations, founded in 1927 to serve Pennsylvania and New Jersey. Maryland joined in 1957, and the nonprofit organization became the Pennsylvania-New Jersey-Maryland Interconnection. Today PJM is the transmission grid operator for all or parts of 13 states and the District of Columbia, responsible for keeping electricity flowing for more than 65 million people in the eastern United States.
With some states, like New Jersey, pushing for a rapid transition from fossil fuels to renewables for the generation of electricity, the grid operator has become a target for political pressure due to the rising costs of such a transition and the easy way the pricing of energy becomes a political issue, especially in election years like 2025.
Elected leaders in some states have concluded that PJM decision-making is what is driving up costs and creating political problems in their states. Suits have been filed, states have asked federal oversight groups to investigate, others have threatened legislation to force changes and possibly even pull their states out of the grid organization. Republican Virginia Gov. Glenn Youngkin called on the organization to fire its chief executive officer.
What has led to the anger focused on PJM is sharply rising energy prices, with demand for electricity increasingly outstripping supply. Part of the reason is soaring increase in electricity use to run new data centers with artificial intelligence. State officials, Murphy included, do not want to lose out in the struggle to host these data centers, which may have a very positive impact on a state’s economy. At the same time these states want to lower costs to their electricity ratepayers even with supply lagging behind demand growth.
PJM has been painted as the dam which, if removed by common-sense reforms, would allow enormous amounts of existing energy to flow to the grid. The pressure is on PJM to speed up the approval of new sources of electricity going to the grid while still maintaining a stable grid.
FERC Chairman Mark Christie who has just been replaced by President Donald Trump, has said that PJM needs reforms. A 2024 report by a Columbia University policy group says that PJM has experienced the most severe delays in bringing online new generation sources. In May, PJM announced that its CEO, Manu Asthana, would step down by year’s end.
Contact the reporter, Vince Conti, at vconti@cmcherald.com.
