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Bill

A 659

Prohibits utility from billing customer for costs incurred for certain upgrades to utility infrastructure; allows costs for certain upgrades to utility infrastructure be recovered in utility's rate base.

2026-2027 Regular Session Introduced by Greg McGuckin

New Jersey bill prevents utilities from direct-billing customers for infrastructure upgrades but allows cost recovery through rate base, spreading expenses across all ratepayers.

Introduced, Referred to Assembly Telecommunications and Utilities Committee
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Bill Summary · A 659

Legislative bill overview

Bill A 659 prohibits New Jersey utilities from directly billing customers for costs of certain infrastructure upgrades while allowing those same costs to be recovered through the utility's rate base (the assets on which utilities earn a regulated return). Essentially, it shifts cost recovery from direct charges to rate-based mechanisms, meaning upgrade costs would be spread across all ratepayers rather than targeted to specific customers.

Why is this important

This bill affects how utility infrastructure modernization gets funded—a critical issue as states push for grid upgrades to support electrification and renewable energy. The distinction matters significantly: rate-base recovery typically spreads costs broadly and is more predictable for utilities, while direct billing targets costs to specific customers but may discourage necessary upgrades if customers can avoid them.

Potential points of contention

  • Cost allocation fairness: Shifting costs to the rate base means all customers pay for upgrades that may primarily benefit others, raising equity concerns for customers in areas that don't receive upgrades
  • Incentive structures: Rate-base recovery guarantees utility profits on infrastructure spending, potentially reducing incentives to minimize upgrade costs or pursue more efficient alternatives
  • Definition ambiguity: The bill references "certain upgrades" without specifying which ones qualify, creating uncertainty about scope and creating potential for future disputes over categorization

Compiled from official sources — confirm details with the bill’s official record.

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