Power Grid Upgrades Underway to Benefit 4,500 JCP&L Customers in Sussex County

Rhea-AI Summary

FirstEnergy Corp. (NYSE: FE) subsidiary JCP&L is undertaking a $50.3 million upgrade of a transmission substation in Franklin Borough, Sussex County. The 18-month project aims to enhance reliability for approximately 4,500 customers across Franklin Borough, Hamburg Borough, Hardyston, Ogdensburg, and Sparta.

The upgrades include substation reconfiguration for increased redundancy, installation of new electrical equipment and control enclosure, addition of a third transformer, and replacement of wooden utility poles with steel monopoles. This project is part of Energize365, FirstEnergy's $26 billion grid evolution program planned for 2024-2028 across six states.

Positive

• Major infrastructure investment of $50.3M to enhance grid reliability
• Part of larger $26B grid modernization program (2024-2028)
• Addition of redundancy and operational flexibility through third transformer
• Infrastructure modernization from wooden to steel poles

Negative

• None.

Insights

Utility Infrastructure Analyst

This $50.3 million substation upgrade project represents a strategic investment in FirstEnergy's grid modernization efforts. The project's scope, including transformer redundancy and high-voltage line reconfiguration, aligns with industry best practices for enhancing grid reliability and operational flexibility. The addition of a third transformer is particularly noteworthy as it provides N-1 contingency capabilities, important for maintaining service during maintenance or equipment failures.

The investment is part of FirstEnergy's broader $26 billion Energize365 initiative, which translates to roughly $5.2 billion annual capital expenditure through 2028. For context, this particular substation upgrade represents approximately 1% of the annual infrastructure investment budget. The focus on replacing aging wooden structures with steel monopoles indicates a shift toward more resilient infrastructure with longer operational lifespans, typically 40-50 years compared to 20-30 years for wooden structures.

While serving only 4,500 customers, this upgrade's strategic value lies in its position within the transmission network backbone. The enhanced redundancy and flexibility will improve the system's ability to reroute power during outages, potentially benefiting a much larger customer base through improved grid stability and reduced maintenance downtime.

Financial Analyst

This project exemplifies FirstEnergy's regulated business model strategy, where capital investments in infrastructure improvements generate predictable returns through rate base growth. The $50.3 million investment will be added to the utility's rate base, typically earning a regulated return on equity of 9-10%. This type of investment is particularly attractive as it combines necessary infrastructure upgrades with guaranteed returns, supporting stable dividend payments to shareholders.

The project is part of the larger $26 billion five-year capital program, which focuses on regulated investments that provide earnings visibility and reduced regulatory risk. For investors, these types of projects are valuable as they represent low-risk, steady returns in a regulated environment. The emphasis on grid modernization and reliability improvements also positions FirstEnergy favorably with regulators, potentially supporting future rate case outcomes.

The timing aligns with broader industry trends toward grid hardening and modernization, particularly as utilities prepare for increased electrification and renewable integration. While the immediate financial impact of this single project is modest relative to FirstEnergy's $22.6 billion market cap, it represents the type of systematic investment that supports long-term earnings growth and dividend stability.

HOLMDEL, N.J., Jan. 16, 2025 /PRNewswire/ -- Jersey Central Power & Light (JCP&L), a subsidiary of FirstEnergy Corp. (NYSE: FE), is upgrading a northern New Jersey transmission substation to better enhance reliability for customers in Sussex County. The project in Franklin Borough is expected to cost $50.3 million and take approximately 18 months to complete.

Doug Mokoid, FirstEnergy's President, New Jersey: "The extensive work happening both inside and outside the fence of our substation in Franklin is designed to enhance the reliability and resiliency of the backbone of our electric grid. Once complete, this project will help us deliver the safe, reliable electricity our customers expect."

The upgrades include:

• Reconfiguring the substation to allow for more redundancy and flexibility.
• Installing new electrical equipment and a new control enclosure.
• Replacing an aging transformer and adding a third transformer to enhance planning and operational flexibility and accommodate existing and future customer demand in the area.
• Installing four steel monopoles outside of the substation, replacing four wooden utility poles and one lattice tower, to allow for the reconfiguration of two high-voltage power lines that will provide backup service if customers' primary lines are out of service.

Approximately 4,500 JCP&L customers in Franklin Borough, Hamburg Borough, Hardyston, Ogdensburg and Sparta are served by the substation in Franklin and stand to benefit from the project.

This work is part of Energize365, FirstEnergy's grid evolution program focused on investing $26 billion between 2024 and 2028 across its six-state footprint to create a smarter, more secure grid that that delivers the power customers depend on today while also meeting the challenges of tomorrow.

JCP&L serves 1.1 million customers in the counties of Burlington, Essex, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset, Sussex, Union and Warren. Follow JCP&L on X @JCP_L, on Facebook at facebook.com/JCPandL or online at jcp-l.com.

FirstEnergy is dedicated to integrity, safety, reliability and operational excellence. Its electric distribution companies form one of the nation's largest investor-owned electric systems, serving more than six million customers in Ohio, Pennsylvania, New Jersey, West Virginia, Maryland and New York. The company's transmission subsidiaries operate approximately 24,000 miles of transmission lines that connect the Midwest and Mid-Atlantic regions. Follow FirstEnergy on X @FirstEnergyCorp or online at firstenergycorp.com.

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/power-grid-upgrades-underway-to-benefit-4-500-jcpl-customers-in-sussex-county-302353618.html

SOURCE FirstEnergy Corp.

FAQ

What is the cost and timeline of FirstEnergy's (FE) Sussex County grid upgrade project?

The project costs $50.3 million and will take approximately 18 months to complete.

How many customers will benefit from FE's Franklin Borough substation upgrade?

Approximately 4,500 JCP&L customers across Franklin Borough, Hamburg Borough, Hardyston, Ogdensburg, and Sparta will benefit from the upgrade.

What is FirstEnergy's (FE) total investment in the Energize365 program?

FirstEnergy plans to invest $26 billion between 2024 and 2028 across its six-state footprint as part of the Energize365 program.

What specific upgrades are included in FE's Franklin Borough substation project?

The upgrades include substation reconfiguration, new electrical equipment, a new control enclosure, a third transformer addition, and replacement of wooden utility poles with steel monopoles.