Electricity rates in New Jersey

New Jersey residents and businesses have had the power to choose their electricity suppliers since 1999. Shop for the lowest kilowatt-hour rates from more than 100 third-party electricity suppliers in the Garden State, each offering a variety of energy plans to compare.

Best energy prices in New Jersey

See the lowest rates available today for your location on the deregulated energy market.

Key players in the New Jersey energy market

The New Jersey Board of Public Utilities introduced the Electric Discount and Energy Competition Act in August 1999, allowing for choice in who powers homes and businesses.

Today, energy in the Garden State is delivered through a system of third-party suppliers, electric distribution companies, co-ops and the New Jersey Board of Public Utilities that work together to get electricity from power plants to your front door.

New Jersey Board of Public Utilities (NJBPU)

NJBPU is the regulatory authority of New Jersey’s utilities that supply electricity, natural gas, water, telecommunications and cable TV. Its mission is to “provide safe, adequate and proper utilities at reasonable, nondiscriminatory rates.” Overseen by a five-member board, it supports the state governor’s goal of 100% clean energy by 2050.

Electric distribution companies

Electric utilities generate and deliver the electricity that powers homes and businesses. Each of the four companies in New Jersey covers a specific territory.

Electric cooperatives

Sussex Rural Electric Cooperative is a locally managed, member-owned nonprofit representing Northwestern Sussex County and a small part of New York’s Orange County. Its mission is to provide electrical service to its members at the lowest possible cost. SREC also provides electricity to Picatinny Arsenal through a 50-year contract with the US Army.

Energy service companies (ESCOs)

More than 100 ESCOs in New Jersey transmit and deliver electricity to homes and businesses in the state, among them:

Alternative energy companies

Most ESCOs in New Jersey offer renewable or clean energy plans that come from natural sources or replenished processes, like wind, hydro or solar energy.

How to find the cheapest electricity rate in New Jersey

Finding the lowest electricity rates in New Jersey requires comparing retail electric providers and energy plans to find the best fit to power your home or business. But first, you’ll want to know your average electricity use.

1. Calculate your current energy use. Look at two or three of your most recent energy bills and average out your use by energy unit — per kilowatt-hour (kWh) for electricity. This information will help you shop for similar or cheaper rates on the market.
2. Shop by ZIP code on an energy marketplace. Marketplaces like EnergyBot can help you compare rates and energy plans specific to your residence with your ZIP code and information about your home.
3. Compare energy providers and plans. Weigh kWh rates, contract terms and potential for savings to narrow down the best provider for your needs.

What is NJ Power Switch?

Power Switch is the state-operated energy shopping website managed by the New Jersey Board of Public Utilities. You can learn more about your rights under deregulation and file a complaint against third-party suppliers through the site.

How to compare electricity plans

You have many third-party electricity suppliers to choose from in New Jersey, each offering different rates and energy plans. Factors to weigh when researching your options come down to rates and the type of plan that fits your electricity needs and budget.

Fixed, variable and hybrid rates

Providers in New Jersey offer the choice of fixed, variable or hybrid kilowatt-hour rates:

• Fixed rates. Fixed rates allow you to lock in a rate for an established contract term. These plans protect your budget from surprise rate spikes, though they can keep you from more easily switching providers with lower rates if the market dips.
• Variable rates. Variable rates allow you to purchase energy without a contract. These plans give you the flexibility to jump to a different provider at any point, though you can expect to pay increased rates when demand is high, such as during colder weather months.
• Hybrid rates. Fixed and floating options split your contract into a fixed rate for part of your term and a variable rate for another.

For variable rates, ask your potential provider if it limits how much rates can fluctuate, which can help you keep costs manageable.

Introductory rates and signup bonuses

Many suppliers and providers offer lower advertised rates or bonuses to entice new customers. These bonuses can be reflected as a lump-sum savings or percentage knocked off the standard rate.

Introductory rates can last the first quarter of your contract, for six months or even the full term. Read the fine print of any offer to understand the rate you’ll pay after the bonus and avoid overpaying for your energy in the long term.

Contract terms and details

Understand the contract system of any supplier you’re interested in. Look at available terms, how the supplier handles renewals and whether you can cancel before your contract ends.

• Contract terms. Contracts can range from three months to a year or more. Longer terms can be easier to manage, while shorter terms allow the flexibility to leverage market dips.
• Contract renewal. Some providers require you to renew a contract term, allowing you to review or change the details of your rate schedule, while others automatically renew your terms unless you tell them not to.
• Contract cancellation. Markets being what they are, you may find lower rates so enticing, you’re willing to pay a termination fee to end your contract early. Understand the penalties you face so that you can factor them into any future decisions to switch providers.
• Late fees and grace periods. Ask potential providers about late fees and how many days after the due date you can make a payment without paying a penalty.

Costs and fees to expect in New Jersey

Your electricity bills include home energy costs that can vary by utility provider or supplier.

• Unit or consumption charges. Energy costs are expressed as kilowatt-hours (kWh) for electricity and therms for natural gas, with variances among residential, commercial and industrial customers.
• Delivery and transmission costs. This is the cost a utility company charges to cover moving energy from power plants, across power lines and pipelines and to your meter.
• Capacity or demand fee. Some electric companies charge a fee to cover the cost of ensuring enough electricity or gas when demand peaks.
• Ratchet charges. Also related to demand, these are periodic fees charged by utilities to recoup costs related to surges in use.
• Taxes. Most suppliers include tax costs in pricing schedules. Ask your supplier about taxes if you don’t see them clearly listed in your bill.
• Other costs and fees. Some states and local governments charge fees that fund public policy programs related to such causes as energy conservation or support for vulnerable communities.

If you choose an alternative energy option, your energy bill may include fees associated with the renewables you choose.

How to switch electricity suppliers in New Jersey

After you’ve found an electricity provider that fits your energy needs, gather up a current monthly bill and get ready for the big switch.

• Call your new energy supplier. Confirm the details of your energy plan and ask any remaining questions. You may need to provide information from your current utility provider to transfer your account. Ask how long you can expect to wait until it’s completed.
• Call your old provider. Your new supplier will notify your old supplier, but it’s helpful to confirm the process directly with your current company.
• Review your first bill. Make sure the details of your new bill match your contract or agreement, and flag any issues as soon as possible for a fix.

Benefits of deregulation in New Jersey

Energy suppliers in the Garden State highlight the financial benefits of electricity choice, further advertising the benefits to the environment through renewable energy.

• Competitive rates. In theory, deregulation requires suppliers to compete for your business, motivating quality service and keeping prices lower than regulated rates over time. Commercial and industrial customers stand to save the most over regulated electricity companies.
• Flexibility of suppliers. Unlike the regulated market that chooses suppliers for you, the deregulated market allows you to customize suppliers and rates for control over how you power your home.
• Access to alternative energy. Deregulation has allowed alternative energy suppliers to compete on the market, offering 100% renewable options to consumers.

What to look out for in New Jersey

Results of deregulation are mixed, and there’s research to suggest that it doesn’t lead to the savings it promises over the regulated market. There’s also the potential for suppliers to lure customers into plans without transparency around the risks.

• Focus on new customers. Some customers say that the incentive for suppliers to draw in new customers sometimes leaves the needs of existing customers in the cold.
• Shaky supply security. If generators aren’t able to meet demand, the system can collapse. These situations are rare but possible: In 2021, the Texas power grid failed due to unexpected extreme weather, resulting in an energy crisis that left more than 10 million people without heat — and electricity suppliers pointing fingers.
• Potential for scams. A confusing deregulated market has resulted in unscrupulous suppliers targeting the elderly, low-income households and other vulnerable communities with aggressive calls to switch utility companies and promises to save money.