New Jersey approves energy efficiency plan, opens Virtual Power Plant proposal to public
New Jersey’s NJBPU approved a one-year energy efficiency plan on July 15, 2026, projecting $531 million in savings, and opened its VPP plan for input.
Photo by HUUM │sauna heaters on Pexels
The New Jersey Board of Public Utilities (NJBPU) approved a one-year energy efficiency transition plan on July 15, 2026, projecting more than $531 million in avoided utility costs over the next decade, according to the regulator’s press release. The New Jersey virtual power plant program is the plan’s stated end goal: NJBPU said the transition, running from July 1, 2027 through June 30, 2028, is meant to prepare the state for its first Virtual Power Plant (VPP) program, scheduled to launch in 2027.
NJBPU President Ben Hertz-Shargel said the changes cut utility program spending by 28 percent by simplifying how energy savings are tracked and reducing administrative overhead. The board adopted a “gross savings” model that counts actual energy saved by efficient appliances rather than compensating utilities based on projected savings, which state officials estimate delivers equivalent energy reductions for about 30 percent lower program cost, per the July 15 release. EnerKnol, an energy-policy research outlet, independently reported the same July 1, 2027 to June 30, 2028 transition window and the $531 million figure in coverage published July 16, 2026.
How the plan leads to a Virtual Power Plant
On July 27, 2026, NJBPU announced it would hold a public meeting on July 30, 2026, at the Conference Center at Mercer County Community College in West Windsor Township to gather input on a VPP “Straw Proposal” released earlier in July. A VPP links devices such as home batteries, smart thermostats and EV chargers into one coordinated system so that, when demand spikes, small adjustments across many devices can substitute for building new power plant capacity, with participants paid through bill credits, discounts or direct payments, NJBPU said.
The VPP effort stems from Governor Mikie Sherrill’s Executive Order No. 2, issued January 20, 2026, which declared a statewide energy emergency and directed the board to build a VPP program, according to the July 27 release. Hertz-Shargel said the program will “tap into technology that’s already sitting in driveways and living rooms across the state.” The board is accepting written comments on the proposal under Docket No. QO26030099 through August 17, 2026, and the meeting was also livestreamed on NJBPU’s YouTube channel without registration.
| Metric | Figure | Source |
|---|---|---|
| Projected ratepayer savings | $531 million over 10 years | NJBPU, July 15, 2026 |
| Utility program spending cut | 28 percent | NJBPU President Ben Hertz-Shargel |
| Program cost reduction from gross savings model | ~30 percent lower | NJBPU, July 15, 2026 |
| Transition period | July 1, 2027 – June 30, 2028 | NJBPU, July 15, 2026 |
| VPP program launch target | 2027 | NJBPU, July 27, 2026 |
| Public comment deadline (Docket QO26030099) | August 17, 2026 | NJBPU, July 27, 2026 |
The four investor-owned utilities named in the July 27 release, PSE&G, JCP&L, Atlantic City Electric and Rockland Electric, are expected to be involved in eventual VPP implementation, alongside ratepayers, technology providers and environmental advocates who NJBPU said it wants to hear from before finalizing the program.
The New Jersey plan adds to a wider set of grid modernization moves winssolutions.org has tracked in 2026, including 481 grid modernization actions taken by US states in the second quarter and New York’s $24 million grid-enhancing technology grants, both aimed at integrating more distributed and renewable resources without costly new infrastructure.
Background
The New Jersey Board of Public Utilities regulates electric, natural gas, water, wastewater and telecommunications utilities statewide and administers the state’s clean energy programs. The energy efficiency programs affected by the July 15, 2026 transition plan are funded through a portion of customers’ monthly electric and gas bills and are entering their next major cycle, Program Cycle 3 (PC3). New Jersey’s push toward a Virtual Power Plant follows Governor Sherrill’s January 20, 2026 declaration of a statewide energy emergency, and the July 30, 2026 public meeting marked the formal start of stakeholder input on how the state’s first VPP program will be designed before it launches in 2027.
Sources: New Jersey Board of Public Utilities; New Jersey Board of Public Utilities; EnerKnol
Featured image: photo by HUUM │sauna heaters on Pexels (free Pexels license).
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I specialize in sustainability education, curriculum co-creation, and early-stage project strategy. At WINSS, I craft articles on sustainability, transformative AI, and related topics. When I’m not writing, you’ll find me chasing the perfect sushi roll, exploring cities around the globe, or unwinding with my dog Puffy — the world’s most loyal sidekick.
