Public Service Enterprise Group
| Company type | Public |
|---|---|
| Industry | Energy |
| Predecessor | Public Service Corporation (origin) |
| Founded | 1985 |
| Headquarters | Newark , United States |
Area served | New Jersey, Long Island (New York) |
| Products | Electricity, natural gas, power generation |
| Owner | Public shareholders |
The Public Service Enterprise Group, Inc. (PSEG) is a publicly listed energy corporation based in Newark, New Jersey. Established in 1985 with origins tracing back to 1903, PSEG primarily conducts its business through its principal subsidiary, Public Service Electric and Gas Company (PSE&G). Founded in 1928, PSE&G holds the distinction of being New Jersey’s oldest and largest regulated utility, delivering electricity and natural gas throughout the state. Initially a segment of the Public Service Corporation, PSE&G continues to be a fundamental element of PSEG’s operational framework and market footprint.
Public Service Electric and Gas Company
Public Service Electric and Gas Company (PSE&G), created in 1928, serves as the chief utility subsidiary under Public Service Enterprise Group (PSEG).
Its origins date to 1903 when more than 400 gas, electric, and transit companies in New Jersey were consolidated under the Public Service Corporation. That same year, electric and gas utilities merged to form PSE&G. After the parent corporation dissolved in 1948, PSE&G became an independent utility entity. The transportation division, initially known as Public Service Coordinated Transport (PSCT), was renamed Transport of New Jersey in 1971 before being sold to New Jersey Transit in 1980. Following this sale, PSE&G concentrated exclusively on utility services.
Public Service Enterprise Group
Established in 1985, Public Service Enterprise Group (PSEG) manages the operations of PSE&G. In 1989, it launched Enterprise Diversified Holdings Inc., now called PSEG Energy Holdings, to oversee non-regulated business ventures. By the year 2000, PSEG separated its unregulated national power generation activities into PSEG Power, while PSE&G maintained its role as a regulated utility within New Jersey.
A merger proposal with Exelon in 2005 received federal approval but was ultimately blocked by New Jersey regulatory authorities. In 2009, PSEG introduced the Solar 4 All program, committing $773 million to install solar panels on approximately 200,000 utility poles—then recognized as the largest project of its kind worldwide—completed by 2013. Additionally, the company established solar farms located in Edison, Hamilton, Linden, and Trenton to expand its renewable energy assets.
In August 2020, Hurricane Isaias resulted in extensive power outages impacting nearly 900,000 customers across Long Island and New Jersey. Restoration times ranged from several hours to multiple days, with around 62,000 customers still without electricity days after the event. The company’s handling of the storm response drew criticism from officials such as New York Governor Andrew Cuomo, who threatened to revoke PSEG’s operating license and demanded customer compensation due to service interruptions.
Operations
Public Service Enterprise Group conducts its business through three primary subsidiaries: Public Service Electric and Gas (PSE&G), PSEG Long Island, and PSEG Power.
Public Service Electric and Gas
PSE&G operates throughout a corridor spanning from Bergen County to Gloucester County in New Jersey, making it the state’s largest provider of both gas and electric services. It supplies natural gas to approximately 1.8 million customers and electricity to about 2.2 million customers across more than 300 urban, suburban, and rural areas, including the state’s six largest cities.
The company’s transmission system features voltage levels of 500 kV, 345 kV, 230 kV, and 138 kV with interconnections linking utilities in Pennsylvania, Delaware, and New York. Subtransmission lines operate at voltages of 69 kV and 26 kV, while distribution voltages are set at 13.2 kV and 4.16 kV.
PSEG Power
PSEG Power consists of four primary divisions: PSEG Nuclear, PSEG Fossil, PSEG Energy Resources & Trade, and PSEG Power Ventures.
PSEG Nuclear manages three nuclear reactors located at two sites within Lower Alloways Creek Township, New Jersey. It fully owns the Hope Creek Nuclear Generating Station and holds a 57% ownership interest in the Salem Nuclear Power Plant, which it operates in partnership with Exelon Corporation. These reactors benefit from annual subsidies amounting to $300 million. Furthermore, PSEG jointly owns the Peach Bottom Nuclear Generating Station in Pennsylvania on an equal basis with Exelon, which is responsible for the plant’s operations.
In October 2024, the New Jersey Board of Public Utilities authorized a settlement that raised the average residential electric and gas bill by approximately 7%, equating to an increase near $15 per month. This adjustment represented PSEG’s first base rate hike since 2018 and remained below inflation levels during that timeframe. The rate change is intended to offset costs associated with infrastructure upgrades and escalating operational expenditures, including employee wages and benefits.
PSEG Long Island
PSEG Long Island provides electricity to around 1.1 million customers spanning Nassau and Suffolk counties as well as the Rockaway Peninsula in Queens, New York City. Operating under a contract with the Long Island Power Authority (LIPA), which retains ownership of the electric grid, PSEG assumed most operational duties beginning January 1, 2014. This transition followed criticism of LIPA’s management during Hurricane Sandy and led to the service being rebranded as PSEG Long Island.
In 2020, LIPA initiated a $70 million lawsuit against PSEG Long Island, accusing it of inadequate response efforts during Tropical Storm Isaias. The suit cited mismanagement and failure to fulfill service commitments despite PSEG collecting nearly $500 million from local customers over a seven-year span.
Rate increases and financial concerns
Throughout 2024, customers served by PSEG Long Island faced seven separate increases in power supply charges, with one adjustment adding roughly $10 monthly to the average bill. The utility attributed these fluctuations to changes in natural gas prices used for electricity production and emphasized that it did not profit from these charges. Nevertheless, the frequency of rate hikes generated substantial public frustration.
Residential users on Long Island, already burdened with some of the nation’s highest utility rates, were billed $4.4 million by PSEG to cover costs linked to pursuing a proposed rate increase. This included lobbying expenses related to an almost 12% electricity rate rise over three years. Consumer advocates criticized this practice for imposing further financial strain on customers who pay rates approximately 62% above the national average.
Call center performance issues
In early 2024, LIPA’s board expressed concern over deteriorating service at PSEG Long Island’s call center. Tracey Edwards, chairwoman of LIPA, reported that in February 2024 only 15% of calls were answered within 30 seconds—a significant drop from 41.8% in 2023—while average call durations approached eight minutes. Previously, wait times had peaked at 22 minutes in September 2022.
PSEG attributed these challenges to increased call volumes and staffing shortages; however, LIPA officials contested this explanation, noting call volumes remained typical and stressing the necessity for service improvements. This issue gains added importance as PSEG prepares to shift its 1.1 million customers onto a new time-of-use rate structure, which is expected to increase customer inquiries significantly.
Negligence and Disputed Claims
PSEG Long Island has encountered scrutiny not only for its storm management but also due to concerns related to safety and upkeep. A federal judge initiated legal action against the utility, accusing it of negligence that resulted in a fire destroying his residence in Suffolk County. He sought $515,000 to cover uninsured reconstruction expenses. The judge noted that a utility employee had previously identified a nearby transformer as outdated and insufficient before the incident.
Issues also arise with customer claims for property damage; out of approximately 2,400 claims submitted annually to PSEG Long Island, only about 15% receive approval.
2025 LIPA Contract Award
At the start of 2025, following the expiration of PSEG Long Island’s contract, LIPA held a competitive bidding process to determine the operator for Long Island’s electrical grid. The contenders were PSEG Long Island and Quanta Services, a utility company based in Texas.
LIPA’s special committee unanimously recommended awarding the contract to Quanta, highlighting its proposal as delivering the “best value to LIPA customers.” Nonetheless, the Board of Trustees voted 6–1 against this recommendation, opting to keep PSEG Long Island as operator; two members abstained from voting. This outcome stirred controversy, with reports emerging about leaked information, lobbying activities, and alleged intimidation tactics.
Executives from Quanta asserted that they had been promised an impartial process free from favoritism toward PSEG, which had managed the grid for over ten years. Analysts described the board’s decision as a reversion to “a legacy of uncertainty” for LIPA. The committee’s comprehensive 150-page evaluation report—ranking Quanta above PSEG and noting that Quanta’s contract terms were “materially better for customers”—has yet to be made public.
In May 2025, an investigation was initiated by the New York State Inspector General into LIPA and PSEG Long Island, examining potential undue influence from lobbyists or political figures affecting decisions related to electric grid operations.
Regulatory and Legal Matters
In 2023, PSE&G agreed to pay a $6.6 million settlement following findings that it provided inaccurate data to PJM Interconnection concerning a $546 million transmission project. The Federal Energy Regulatory Commission (FERC) determined that PSE&G breached regulations mandating truthful information during the Regional Transmission Expansion Plan process.
This settlement pertained to a 2017 initiative aimed at replacing a transmission line within New Jersey’s Roseland–Pleasant Valley corridor. The case highlighted concerns about limited regulatory scrutiny over local transmission projects classified as “supplemental projects” within the PJM framework. After the settlement, Public Citizen, a consumer advocacy organization, filed a formal protest with FERC challenging how project costs were allocated and contending that ratepayers should not be responsible for imprudent expenditures. The protest also criticized PJM and its board for lacking sufficient independent oversight.
Environmental Performance
In 2001, PSEG received both the Walter B. Jones Memorial Award and Excellence Awards from NOAA in recognition of its Estuary Enhancement Program and demonstrated leadership in managing coastal resources responsibly.
Conversely, Violation Tracker records indicate that PSE&G has been subject to numerous regulatory infractions amounting to over $364 million across 33 cases involving environmental violations, competition issues, consumer protection breaches, and safety lapses. Significant penalties include a $10 million fine for utility service violations in 2020, a $6.6 million penalty related to energy market violations in 2024, and a $344.4 million air pollution fine imposed on its subsidiary PSEG Fossil LLC in 2002.
See also
External links
- "Long Islanders React to Seventh Utility Rate Hike This Year". NBC 4 New York. December 2, 2014.
- Articles with short description
- 1903 establishments in New Jersey
- American companies established in 1903
- Companies based in Essex County, New Jersey
- Companies based in Newark, New Jersey
- Companies in the Dow Jones Utility Average
- Companies listed on the New York Stock Exchange
- Electric power companies of the United States
- Non-renewable resource companies established in 1903
- Public Service Enterprise Group
- Companies of the United States by year of establishment
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