Handling the Atlantic City Electric Rate Hike and Cutting Your 2026 Costs

Electricity costs in Southern New Jersey have undergone a significant transformation over the last twelve months. For the approximately 556,000 customers served by Atlantic City Electric (ACE), the monthly bill is no longer just a routine expense to be paid without a second thought. Following the rate adjustments that took effect in mid-2025, many households have seen their expenses climb by an average of 17.2%, or roughly $28 per month for a typical user. Understanding why this happened and how to navigate the current 2026 energy landscape is essential for maintaining a balanced household budget.

Atlantic City Electric operates across a massive 2,800-square-mile service area, stretching from the Delaware River to the Atlantic Ocean and encompassing counties like Atlantic, Cape May, Cumberland, and parts of Burlington and Camden. As a regulated utility under the Exelon umbrella, the company is responsible for the infrastructure—the poles, wires, and substations—that keeps the lights on. However, the cost of the actual electricity you consume is a different matter altogether, influenced by state auctions and global energy markets.

The Reality of 2026 Electricity Rates

The current price structures are a reflection of several converging factors: rising wholesale costs for natural gas, increased regional demand driven by the proliferation of data centers, and massive investments in grid modernization. In New Jersey, the price for electricity supply is determined through a state-run auction known as the Basic Generation Service (BGS) auction. Atlantic City Electric does not make a profit on the electricity it buys for you; it simply passes that cost through to the consumer.

As of the 2025-2026 cycle, the "Price to Compare" (PTC) has reached levels that require active management. For residential customers, the rates are tiered based on usage and seasonality. During the peak summer months, those using over 750 kWh per month are seeing rates around 18.920 cents per kWh. This is a sharp contrast to the rates seen just a few years ago. Even for lower-usage households (under 750 kWh), the rate remains significant at 17.920 cents per kWh.

Seasonal Variations and the PTC

It is important to remember that Atlantic City Electric changes its default supply rates twice a year. The summer rates, which apply from June through September, are typically designed to account for the higher demand caused by air conditioning. Winter rates, running from October through May, often see a slight adjustment. For 2026, the annualized average provides a benchmark that helps consumers decide whether to stick with the utility's default supply or switch to a third-party provider.

These numbers represent the "Supply" portion of the bill. When you add the "Delivery" charges—which cover the maintenance of the physical grid—the total cost per kilowatt-hour often exceeds 20 cents. This makes South Jersey one of the more expensive regions for energy in the Mid-Atlantic, necessitating a closer look at how energy is consumed within the home.

Deciphering Your Atlantic City Electric Bill

To effectively lower your costs, you must first understand the anatomy of your ACE bill. Most customers glance only at the "Total Amount Due," but the real insights are hidden in the breakdown on the second page. Your bill is essentially split into two primary categories: Delivery Charges and Supply Charges.

Delivery Charges: The Fixed Component

Delivery charges are what you pay Atlantic City Electric to maintain the grid. This includes the 90 substations and thousands of miles of transmission lines across the region. These charges are regulated by the New Jersey Board of Public Utilities (BPU). Even if you choose a different electricity supplier, ACE will still deliver the power, and these delivery charges will remain on your bill. They include components like the customer charge (a flat monthly fee), distribution charges (based on usage), and various state-mandated transition and societal benefits charges.

Supply Charges: The Variable Component

This is the cost of the energy itself. If you haven't shopped around, you are likely receiving "Basic Generation Service." This is where the "Price to Compare" comes in. By looking at the supply section of your bill, you can see exactly how much you are paying per kWh. If a third-party supplier offers a rate lower than the current ACE PTC, you have the potential to save money. Your account number and residential service number, found on the top of the second page, are the keys to making this switch.

Maximizing Energy Efficiency Rebates in 2026

One of the most effective ways to offset the recent rate hikes is to take advantage of the robust energy efficiency programs offered by Atlantic City Electric. The company has allocated millions of dollars toward helping customers reduce their carbon footprint and their monthly expenses. These programs range from simple appliance rebates to deep-home energy retrofits.

Appliance Rebate and Recycling Programs

If you are planning to upgrade your appliances, checking for Energy Star certification is a financial necessity. ACE offers rebates up to $750 for qualifying products. These incentives apply to high-efficiency washing machines, dryers, and heat pump water heaters.

Furthermore, the appliance recycling program provides a double benefit. If you have an old, inefficient refrigerator or freezer running in your garage or basement, ACE will pick it up and recycle it at no cost. In return, you receive a $100 incentive. If you include a working room air conditioner or dehumidifier at the same time, you can earn an additional $35. This not only puts cash in your pocket but also removes a significant "energy vampire" from your home, potentially saving another $100 annually in reduced electricity usage.

The No-Cost Whole Home Energy Assessment

Perhaps the most underutilized tool in the ACE arsenal is the no-cost Whole Home Energy Assessment. A certified energy professional will visit your residence to conduct a thorough evaluation of how your home uses—and loses—energy. During this visit, they often perform several immediate upgrades at no additional cost to you, such as:

• Installing high-efficiency LED light bulbs.
• Adding smart power strips to prevent phantom power draw from electronics.
• Installing efficient-flow showerheads and faucet aerators.
• Checking insulation levels and identifying air leaks.

Following the assessment, you receive a customized report. This report is your roadmap for 2026. It identifies larger improvements, such as attic insulation or HVAC upgrades, and details the specific rebates available to help cover those costs. In some cases, the Whole Home Energy Solutions program offers rebates of up to $7,500 for comprehensive upgrades that significantly lower your long-term demand.

Navigating Financial Assistance and Payment Plans

For many residents in Southern New Jersey, the recent rate increases have created genuine financial hardship. If you find yourself struggling to keep up with your monthly payments, it is critical to engage with assistance programs before a past-due balance becomes unmanageable. There are several federal, state, and utility-specific options available.

LIHEAP and USF

The Low-Income Home Energy Assistance Program (LIHEAP) is a federal grant that helps eligible households pay for heating and cooling costs. In 2026, eligibility is typically based on household size and income relative to the federal poverty level. Closely linked to this is the Universal Service Fund (USF), a New Jersey state program that provides monthly credits on electric and gas bills to ensure that energy remains affordable for low-income families.

The PAGE Program

For those who might not qualify for LIHEAP but are still facing a temporary financial crisis, the Payment Assistance for Gas and Electric (PAGE) program is an essential resource. This is designed for low-to-moderate-income households who are experiencing a short-term setback, such as a job loss or medical emergency. It can provide a one-time grant to help clear a balance and avoid service disconnection.

Internal ACE Support

Atlantic City Electric also offers flexible payment arrangements. These can include Budget Billing, which levels out your payments over 12 months so you don't get hit with massive bills during the peak summer cooling season. By paying the same amount every month, you can avoid the volatility of seasonal spikes. If you are already behind, the company often works with customers to establish installment plans that prevent shut-offs while you get back on your feet.

Practical Daily Strategies for Lower Bills

While high-level programs and rebates are important, daily habits in a South Jersey home can collectively make a significant difference. Considering the 18.920 cents/kWh rate, every kilowatt saved is more valuable than ever.

1. Thermostat Management: Setting your thermostat just two or three degrees higher in the summer and lower in the winter can reduce your consumption by 5-10%. A smart thermostat, which can be purchased with ACE rebates, automates this process by learning your schedule and adjusting temperatures when you are away or asleep.
2. Sealing the Envelope: Many older homes in the ACE service territory suffer from air leakage. Simple DIY fixes like caulking around window frames and using weather stripping on doors can prevent your conditioned air from escaping. This is particularly important for homes near the coast where wind infiltration is more pronounced.
3. Water Heating Efficiency: Water heating is typically the second-largest energy expense in a home. Lowering the temperature on your water heater to 120°F (49°C) is usually sufficient for all household needs and prevents the unit from overworking. If your water heater is more than 10 years old, upgrading to a heat pump water heater using ACE rebates is one of the highest-ROI investments you can make in 2026.
4. Lighting and Electronics: The transition to LEDs is nearly complete for most, but many still overlook "vampire" loads. Devices like gaming consoles, old televisions, and desktop computers draw power even when turned off. Utilizing smart power strips that cut power to peripherals when the main device is off is a simple, low-cost fix.

Infrastructure and the Smart Network Investment

Part of the reason for the recent distribution rate increases is Atlantic City Electric's ongoing investment in the "Smart Network." While rate hikes are never popular, it is worth understanding what this capital is funding. The company is currently deploying advanced metering infrastructure and automated switching technology across its 2,800 miles of lines.

This technology is designed to improve reliability and resilience, particularly during the severe coastal storms that frequently impact Southern New Jersey. The smart network allows the company to identify the location of outages more quickly—sometimes before a customer even calls—and can remotely reroute power to restore service to large areas within minutes. For a region that relies heavily on tourism and seasonal business, this reliability is a critical component of the local economic infrastructure.

Furthermore, these grid investments are paving the way for more renewable energy integration. As more residents install solar panels and switch to electric vehicles (EVs), the grid must be capable of handling two-way power flows and higher localized demand. ACE's specific EV residential rates and incentives for home charging stations are part of this broader transition toward a more electrified, carbon-neutral economy in New Jersey.

Choosing a Third-Party Supplier: Risks and Rewards

New Jersey's deregulated energy market means you have the right to shop for your electricity supply. This is a powerful tool for ACE customers, but it must be used with caution. When you look at your "Price to Compare," you are looking at a benchmark. Third-party suppliers will often offer rates that seem significantly lower than the ACE default supply.

Fixed vs. Variable Rates

The most important factor when choosing a supplier is the type of rate offered. A fixed-rate plan locks in your price for a specific period (e.g., 12 or 24 months). This provides budget certainty and protects you if the BGS auction prices rise again. However, be aware of "teaser rates" that might be low for the first three months before jumping to a much higher variable rate.

A variable-rate plan fluctuates with the market. While this can sometimes be lower than the PTC, it carries the risk of sudden spikes during extreme weather events or energy market volatility. In 2026, with energy markets still showing signs of fluctuation, many experts suggest that a fixed-rate plan with no cancellation fees is the safest way for residential customers to explore the third-party market.

How to Switch Safely

If you decide to switch, you do not need to contact Atlantic City Electric. The new supplier will handle the transition. You will still receive one bill from ACE, and they will still respond to power outages. The only change will be the name of the supplier and the rate charged in the "Supply" section of your statement. Always read the fine print for enrollment fees, monthly service charges, or early termination penalties that could negate any potential savings per kWh.

Conclusion: A Proactive Approach to 2026 Energy

The landscape of energy in Southern New Jersey has shifted toward higher costs and more complex choices. Being a passive consumer of Atlantic City Electric services is no longer the most cost-effective path. By understanding the 2025-2026 rate structures, utilizing the suite of available rebates, and considering a move to a third-party supplier, you can regain control over your utility expenses.

Whether it is scheduling a no-cost energy assessment or finally recycling that old refrigerator in the garage, the opportunities for savings are tangible. As the grid continues to modernize and rates remain high, the most successful ACE customers will be those who view their electricity not just as a utility, but as a manageable resource that requires active oversight and strategic investment.