Exelon sees $3–7B in utility storage; its NJ test case faces dismissal bid

Exelon told investors on October 30, 2026 that its utilities see a $3 billion to $7 billion opportunity in 1.5 to 3.5 GW of utility-owned energy storage, on top of the roughly $1 billion, 500 MW battery Atlantic City Electric (ACE) has proposed in New Jersey. Exelon's third-quarter earnings deck lists the storage range as "visible opportunity beyond the plan," outside its $41.7 billion capital plan, beside $12 billion to $17 billion of transmission opportunity. The storage figure is new this quarter: the July deck put a number beyond the plan on transmission alone.

The same deck says the New Jersey project "remains on track" and expects a final order from the Board of Public Utilities in the first quarter of 2027. The case docket is less serene. New Jersey's Division of Rate Counsel has asked the board to dismiss the petition outright, arguing that New Jersey's 1999 restructuring law forbids rate-regulated utility ownership of generation, and PJM's independent market monitor has backed the motion. ACE filed its opposition on October 30, the day of the earnings call.

Exelon's case for owning batteries

Exelon's argument for owning storage is control. "With regulated storage, we have certainty that projects get built, and control over when and how they're deployed," chief financial officer Rob Kleczynski said on the call, as Utility Dive reported, calling it "one option alongside competitive development, not a replacement for it." He said customers would benefit through lower capacity prices and the flow-through of investment tax credits, and that New Jersey, Maryland and Delaware allow Exelon's utilities to own storage facilities to bolster grid resiliency.

Chief executive Calvin Butler's complaint was that PJM Interconnection is not adding generation fast enough, according to Utility Dive. PJM's backstop procurement has been refiled to open March 1, 2027 if FERC accepts it, and FERC rejected PJM's large-load curtailment plan on October 9. "Neither proposal would have solved the reliability and affordability challenges facing our customers, but both represented important steps forward," Butler said.

Exelon wants more than batteries. A company whose deck calls it a "pure T&D-only utility" is asking states for policies "including utility-owned generation and battery storage," and, as a longer-term fix, for "state-directed planning and procurement of generation resources," with the capacity market "providing residual support."

The New Jersey test case

The project is Pittsgrove Storage, a four-hour lithium iron phosphate battery of up to 500 MW on ACE-owned land in Pittsgrove Township, Salem County, per ACE's July 23 petition. At four hours, that is about 2,000 MWh by our arithmetic (power versus energy). Invenergy would help develop and build it and then operate it for ACE, which estimates it could run as soon as the last quarter of 2030. ACE would sell its energy, capacity and ancillary services into PJM and put the plant in rate base at a 9.6% return on equity, which performance incentives could raise, with market revenues and tax credits offsetting the cost. The petition projects no incremental bill impact for roughly the first five years of operation and $1.36 of customer benefits per $1.00 invested.

New Jersey's ratepayer advocate says the petition fails as a matter of law. Rate Counsel's motion to dismiss, dated October 16, calls ACE's position "patently incorrect." The statute ACE invokes permits utility investment only in energy efficiency and conservation programs and Class I renewable resources or programs, and a battery is none of those, Rate Counsel argues. It adds that the 1999 Electric Discount and Energy Competition Act (EDECA) deregulated generation and capacity services, and that the board limited its own storage program, the Garden State Energy Storage Program, to "private (non-EDC) and governmental entities," excluding the utilities. "It is unclear why any private developer would invest in storage in New Jersey when they must compete against a rate-regulated utility that faces no market risk, earns a guaranteed return, and also controls the developer's interconnection," the motion says. It also asks the board to toll the 180-day review period until it rules.

Monitoring Analytics, PJM's market monitor, agreed with all of it on October 29. It counts 55,603.3 MW of batteries in PJM's queue seeking to become competitive market resources, and its answer names the parent company: "Exelon's proposal is inconsistent with the competitive PJM market design and is likely to increase costs to New Jersey customers when compared to a competitive market solution."

ACE's response calls the case "a question of first impression": whether a utility may own a transmission-scale battery, run it in wholesale markets and recover its net costs from customers. A battery selling into PJM is not "electric generation service" under EDECA, which covers retail supply, ACE argues, so the 1999 law is no bar. It says the 180-day clock began when staff deemed the petition complete as of September 25 and that Rate Counsel offered no reason to stop it.

Missouri regulators approved 545 MW of Ameren batteries on October 21 and left who pays for later proceedings. New Jersey's question comes earlier: whether a utility that, by its own account, sold its regulated power plants in the early 2000s may own a grid battery at all.

Who else wants in

The fight has drawn the generators. A board order set October 27 as the deadline to seek intervention or participation, with responses due November 6. Constellation moved to intervene as a wholesale supplier that owns about 43% of the Salem nuclear station, in the same county as the proposed battery. ACE, board staff and Rate Counsel agreed that oppositions to the motion were due October 30 and replies November 10. The PJM Power Providers Group (P3), which has moved to intervene, objected on October 29 that briefing should wait until intervention is decided and asked that the motion be held in abeyance; the New Jersey Large Energy Users Coalition, also seeking intervention, agreed the next day that briefing should not run ahead of those rulings. The docket listed the case as under review on November 3.

Outlook

Pittsgrove is the only project in the storage pipeline on Exelon's deck, and the first test of whether a New Jersey utility may own a grid battery at all. If the board dismisses the petition, the $3 billion to $7 billion range would lean on the other states Kleczynski named, Maryland and Delaware. If the board denies the motion and does not toll the clock, 180 days from September 25 runs to March 24, 2027 by our count, inside the first quarter Exelon is guiding to. P3's request to hold the motion in abeyance is the nearer risk to that date.