Otis Singleton
New Jersey has a deregulated electricity market, which means that consumers can shop around for the best electricity rates for their business or home. This has driven down the cost of electricity supply as companies compete for customers. The average residential electricity rate in New Jersey is 20.16 ¢/kWh, which is 15% higher than the national average. The average monthly industrial electricity bill in New Jersey is $5,344, which ranks 36th in the nation.
| Characteristics | Values |
|---|---|
| Average industrial electricity rate | 10.52 ¢/kWh |
| Average industrial electricity consumption | 50,818 kWh/month |
| Average monthly industrial electricity bill | $5,344 |
| Average residential electricity rate | 15.78 ¢/kWh to 20.16 ¢/kWh |
| Average residential electricity consumption | 691 kWh/month to 1,050 kWh/month |
| Average monthly residential electricity bill | $109 to $222 |
| Average commercial electricity rate | 15.41 ¢/kWh |
| Average monthly commercial electricity bill | $833 |
| Electricity market | Deregulated |
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What You'll Learn
Average industrial electricity rate
The average industrial electricity rate in New Jersey is not readily available. However, it is a leading industrial state in the country and the largest chemical-producing state. The state's energy market is deregulated, which means that businesses can shop around for the best electricity rates.
Energy suppliers offer two types of plans for business customers: a fixed-rate plan or a variable-rate plan. A fixed-rate plan is a contract with an energy supplier that offers a constant rate for the term of the contract. Variable-rate plans, on the other hand, are often called "V-shaped plans" because the rates are more expensive for those who use the least and most energy, and lowest for those in the middle.
The average commercial electricity rate in New Jersey is 15.41 ¢/kWh, which is 17% higher than the national average. This rate is for businesses, which may include industrial sectors. The average residential rate in New Jersey is 19.68 ¢/kWh as of May 2025, according to the U.S. Energy Information Administration (EIA). This rate is expected to rise by 17-20% starting June 2025, potentially reaching 24.05 ¢/kWh.
New Jersey has an ambitious goal of requiring 35% of energy sold in the state to come from renewables by 2025. As such, most energy providers offer 100% green energy plans, which may cost 1 to 2 cents more per kWh than non-renewable plans.
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Average industrial electricity bill
The average industrial electricity bill in New Jersey is $5,344 per month, which is 28.58% less than the national average monthly bill of $7,483. The average industrial electricity rate in New Jersey is 10.52 cents per kWh, which is 57.72% greater than the national average of 6.67 cents per kWh.
New Jersey has a deregulated energy market, which means that consumers can shop around for the best electricity rate from Certified Retail Electric Suppliers (CRES). This allows customers to take advantage of competitive rates and reduce their monthly expenses. Online tools and websites such as EnergyBot, EnergyPricing.com, and WattBuy allow consumers to compare electricity plans, rates, and suppliers. The Board of Public Utilities (BPU) in New Jersey also launched NJ Powerswitch, a website that provides information on energy deregulation, supplier lists, and tips for shopping for energy.
Energy suppliers in New Jersey offer two types of plans for residential and business customers: fixed-rate plans and variable-rate plans. It is important for customers to understand the differences between these plans before signing up for an electricity plan. Fixed-rate plans offer a constant rate for the term of the contract, while variable-rate plans may be influenced by factors such as energy usage.
To reduce their electricity bills, consumers can consider installing solar panels or subscribing to a community solar farm. On average, it takes about 7.77 years for a solar investment to break even in New Jersey. Even with solar panels, a property that remains grid-connected will still receive an electric bill from the utility provider.
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Energy deregulation
New Jersey has a deregulated energy market, meaning that consumers can choose their energy supplier and plan. Prior to 1999, New Jersey residents could only purchase electricity from their local utility company. However, New Jersey's energy market was deregulated to allow for consumer choice. This gave customers the option to choose from Certified Retail Electric Suppliers (CRES).
In New Jersey, the average monthly electric bill for residential customers is $222/month, which is calculated by multiplying the average monthly consumption by the average electric rate: 1,050.00 kWh * 21 ¢/kWh. The average electric rates in New Jersey cost 21 ¢/kilowatt-hour (kWh), so the average electricity customer in New Jersey is using 1,050.00 kWh of electricity per month. As of May 2025, the average residential rate is around 19.68 cents per kWh, according to the U.S. Energy Information Administration (EIA). This is a sizable increase from past years due to inflation and grid upgrades.
In 1977, the federal government responded by establishing the Federal Energy Regulatory Commission (FERC). FERC took the bold step of deregulating the energy industry, leaving it up to individual states to decide how to supply energy to its energy users. With a now-standard energy infrastructure, it was possible to introduce market competition back into the industry with the goal of lowering energy costs. In deregulated states, the utility companies continue to own the delivery infrastructure.
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Renewable energy sources
New Jersey has some of the cleanest electricity in the country, with a strong focus on renewable energy sources. The state has long been ahead of the curve, with policies in place since the 1990s to promote clean energy and combat climate change.
In 1999, New Jersey became one of the first states to adopt a Renewable Portfolio Standard, requiring a certain amount of electricity to be sourced from renewables. This law has since been strengthened and is now one of the strictest in the US. The state legislature has enacted several substantial revisions to the standard, including increased use of solar energy, offshore wind energy, small-scale hydroelectric, and waste-to-energy facilities. The most recent update to the law, in May 2018, requires 50% of electricity sold in New Jersey to come from approved renewable sources by 2030, with a portion of this to be from offshore wind.
New Jersey is committed to achieving 100% clean energy by 2050. In 2020, the state released its Energy Master Plan: Pathway to 2050, a blueprint for meeting this target. The plan includes carbon-neutral electricity generation, electrification of transportation, increased energy efficiency, transmission grid improvements, and expanding net-zero carbon homes incentive programs.
The state also offers incentives for residents to use renewable energy sources. For example, New Jersey offers tax credits and other incentives for rooftop solar installations, including exemption from the state's 7% sales tax. The state also has community solar projects that residents can join, and power providers that produce electricity from clean sources. Additionally, New Jersey requires electric companies to offer net metering, meaning that if a customer's rooftop solar panels produce more power than they use, the utility company must give credit for the excess power at the full retail rate.
Solar energy is the primary source of renewable electricity generation in New Jersey, with utility-scale and small-scale facilities accounting for almost 90% of the state's renewable electricity generation. The rest is produced from biomass, with small amounts from wind and hydropower.
New Jersey also plays a major role in the supply of energy to the entire Northeast region. The state has extensive pipeline, rail, and storage terminals that make it a hub for the distribution of petroleum products.
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$11.99
Fixed-rate plans
New Jersey has a deregulated electricity market, which means that consumers can shop around for the best electricity rates from different suppliers. This gives customers the flexibility to choose from various plans and rates offered by Certified Retail Electric Suppliers (CRES).
Energy suppliers in New Jersey offer two different types of plans: fixed-rate and variable-rate. Fixed-rate plans allow consumers to lock in a rate for electricity for a set period, often 12 or 24 months. During this period, the rate per kilowatt-hour (kWh) remains constant, shielding consumers from market fluctuations and rate spikes. This makes budgeting easier and provides price protection against sudden increases in energy prices. Fixed-rate plans are particularly beneficial for those living on a fixed income or in areas with significant seasonal weather variations, as they ensure that energy remains affordable.
On the other hand, variable-rate plans offer more flexibility, as consumers can switch plans when energy prices change. Variable-rate plans often have lower introductory rates, but once this period expires, the cost becomes subject to market volatility.
While fixed-rate plans offer stability, they may also carry the risk of missing out on potential savings if energy prices decrease for an extended period. Additionally, fixed-rate plans do not guarantee that energy bills will remain the same every month, as the total bill depends on energy usage.
In summary, fixed-rate plans in New Jersey provide consumers with price protection, stability, and predictable budgeting. These plans are well-suited for individuals seeking to hedge against market fluctuations and those living in areas with significant seasonal weather variations. However, it is important to carefully consider one's energy usage patterns and market conditions before committing to a fixed-rate plan.
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Frequently asked questions
The industrial electricity rate in New Jersey is 10.52 cents per kilowatt-hour (kWh).
The average industrial electricity rate in the US ranges from 4.13 cents/kWh to 30.82 cents/kWh. New Jersey's rate of 10.52 cents/kWh is 57.72% greater than the national average of 6.67 cents/kWh.
The average monthly industrial electricity bill in New Jersey is $5,344, which is 28.58% less than the national average of $7,483.
New Jersey's electricity prices are vulnerable to the volatility of fuel prices due to the state's reliance on natural gas for 49% of its electricity generation. Additionally, infrastructure costs for grid maintenance and modernisation, as well as high summer usage, can contribute to spikes in electricity prices.
New Jersey has a deregulated energy market, which means that residents and businesses can shop around for the best electricity rates and switch energy providers. They can also choose between fixed-rate plans, which offer a constant rate for the term of the contract, and variable-rate plans, which have their own pros and cons.
