New Jersey Regulator Examines Framework for Statewide Virtual Power Plant Program

The New Jersey Board of Public Utilities on July 27 announced a public stakeholder meeting scheduled for July 30 to discuss its proposed statewide Virtual Power Plant program, as the regulator seeks input on a straw proposal aimed at improving grid reliability, lowering electricity costs and expanding the use of distributed energy resources. The proposal, released earlier this month, was developed in response to Governor Mikie Sherrill’s Executive Order No. 2 declaring a statewide energy emergency and directing the board to develop a VPP program.

The straw proposal outlines a framework to aggregate customer-owned distributed energy resources, including residential battery systems, smart thermostats and electric vehicle chargers, into coordinated networks capable of supplying grid services during periods of peak electricity demand. Rather than relying solely on new generation resources, the proposal seeks to leverage flexible customer-owned assets to improve system reliability, reduce peak demand and lower overall system costs. Participating customers would be eligible to receive compensation through bill credits, rebates or direct payments, while the framework also considers program eligibility, operational requirements, consumer protections and utility coordination needed to support large-scale deployment.

The proposal represents a key component of New Jersey’s broader grid modernization strategy as electricity demand continues to grow and policymakers evaluate alternatives to traditional infrastructure investments. The board also intends to incorporate lessons from VPP programs operating in other states to help shape market rules, customer participation models and technology requirements. Input from electric utilities, technology providers, consumer advocates, environmental organizations and other stakeholders is expected to inform the final program design and address implementation issues before statewide deployment.

The July 30 meeting will include educational sessions on existing utility programs, best practices from states with established VPP programs and a detailed review of the straw proposal before opening the discussion to stakeholder feedback. Written comments will be accepted through Aug. 17 before the board develops a final framework. The initiative positions New Jersey among a growing number of states pursuing VPPs as a grid management tool to improve reliability, reduce peak demand and maximize the value of distributed energy resources.