A federal audit found that Atlantic City Electric overbilled transmission customers and committed other accounting violations, but a critical question for South Jersey residents remains unanswered: Will any of that money actually come back to them?
The Federal Energy Regulatory Commission identified five areas of noncompliance and issued 22 recommendations following an audit of Atlantic City Electric's financial practices from 2021 through 2025. FERC lists the Atlantic City Electric review, docket FA25-4, among its completed 2026 financial audits.
Two of the findings are particularly significant.
Auditors determined Atlantic City Electric improperly recorded settlement payments involving alleged employment-discrimination claims as operating and administrative expenses. FERC concluded the accounting treatment overstated the utility's annual transmission revenue requirement and resulted in transmission customers being overbilled.
Auditors also found Atlantic City Electric improperly accounted for certain materials and supplies inventory write-offs, potentially overstating the transmission revenue requirement and overbilling wholesale transmission customers.
But the audit does not say every Atlantic City Electric residential customer was overcharged, does not specify an amount owed to residential customers and does not order the utility to begin mailing refund checks.
That distinction has become increasingly important as elected officials tout the audit as a victory and call for customers to be reimbursed.
Van Drew Demands Answers — And Refunds if Customers Paid Too Much
U.S. Rep. Jeff Van Drew, R-2nd, who pushed for the federal review after raising concerns about soaring South Jersey electric bills, is demanding that Atlantic City Electric determine how much was improperly charged and whether those costs ultimately reached families and businesses.
“If South Jersey families paid even one dollar more because of these failures, they deserve that dollar back,” Van Drew said Thursday.
Van Drew also renewed his call for the entire New Jersey Board of Public Utilities to resign, accusing state regulators of approving repeated rate increases while failing to identify the accounting problems uncovered by federal auditors.
But even Van Drew's latest demand highlights the central unresolved issue: Atlantic City Electric still must determine whether the transmission-level findings translated into improper charges to individual residential and business customers.
Atlantic City Electric: Audit Doesn't Establish Residential Impact
Atlantic City Electric says the audit is being interpreted too broadly in some discussions.
Cynthia Holland, a spokeswoman for Atlantic City Electric, told KYW Newsradio that the federal review focused on transmission rates and federal accounting standards, not individual household bills.
“This audit report doesn't speak about residential customers or direct customer bill impacts,” Holland said.
Atlantic City Electric also says the audit did not conclude that the company violated federal tax law and did not identify a specific dollar amount of customer overbilling.
Company spokesman Brian Ahrens told BreakingAC that two of the five findings require additional analysis to determine whether customers were affected and whether refunds are warranted. The company says it accepted FERC's recommendations and is completing that analysis.
That means South Jersey customers hoping the audit will produce substantial refund checks may have to wait considerably longer for an answer.
Pittman: Don't Tell Customers a Big Refund Is Coming Yet
Nor'Easter Nick Pittman, the longtime South Jersey meteorologist and media personality who spent roughly two years publicly challenging Atlantic City Electric over rising bills, told South Jersey NewsBeat on Friday that he welcomes the audit but believes its significance is being overstated.
“While I'm pleased to see an audit was actually conducted, I'm not very impressed overall,” Pittman said. “It's unclear if residential bills are impacted and it seems extremely limited in scope.”
Pittman said he is particularly concerned that customers could interpret the political reaction to the audit as a promise that substantial refunds are imminent.
“It is being framed as a big win and gives folks the impressions they're going to get big refund checks in the mail,” Pittman told South Jersey NewsBeat. “I'd bet my farm, if I had one, that won't happen.”
Pittman said the actual audit findings are much narrower.
“The audit concluded that ACE overcharged transmission fees but doesn't go into specifics,” Pittman said. “No amounts, nothing.”
On that central point, Pittman's characterization is consistent with what is publicly known about the audit: FERC found overbilling at the transmission level, but no residential refund amount has been announced.
Pittman Says Problem Goes Beyond One Party
Pittman, who describes himself as a former Republican who is now an independent, said he doesn't believe either political party deserves to declare victory over New Jersey's energy problems.
“The issue is much bigger and there's been endless finger pointing by politicians on both sides of the aisle,” Pittman said.
“The blunt truth is this: both sides have horribly failed the people of New Jersey. Costs are spiraling out of control. Working families are finding it harder and harder to live in this state. Chief among the rising costs is energy.”
Pittman said he became heavily involved in the Atlantic City Electric issue about two years ago, using his background in meteorology to question explanations linking some higher bills to weather.
“Two years ago I jumped on this issue,” Pittman said. “I was the leading voice on it until we were able to finally cajole politicians to get involved. I believe it is incumbent upon those with large platforms to work on issues that impact everyone, without partisan politics considered.”
Pittman said he analyzed electric bills alongside historical temperature data after Atlantic City Electric cited weather among factors contributing to higher usage.
“ACE wrongly claimed that the increased costs were due to extreme weather,” Pittman said. “Well, that just so happens to be my area of expertise. I disproved their claims time and time again by comparing bills and temperature data over the past decade.”
“I found that bills, in some cases, were 50% less several years ago when it was actually hotter,” he said. “It's easy to put blame on the weather because most just accept it and move on.”
The FERC audit itself did not evaluate Pittman's weather analysis or conclude that weather explanations for residential bills were false. Its findings concerned Atlantic City Electric's accounting and transmission revenue requirements.
Pittman Worked With Van Drew — But Now Wants More
Pittman said he worked closely with Van Drew as the congressman began pressing Atlantic City Electric for answers.
“I worked tirelessly with Jeff Van Drew,” Pittman told South Jersey NewsBeat. “I testified at a hearing he held as an expert witness and provided reports and video explanations.”
Pittman also recalled a private conversation in which he said Van Drew promised greater action once Republicans gained political power.
According to Pittman, Van Drew told him: “As soon as the GOP wins the majority, we will get this issue solved.”
South Jersey NewsBeat has not independently verified that private conversation.
“Well, here we are, still waiting,” Pittman said. “Very little has been said since the last election. I find it very convenient that the midterms are right around the corner and all of a sudden this comes out front and center to make the issue relevant again.”
Still, Pittman did not dismiss Van Drew's efforts.
“While I applaud the congressman's efforts, it's nowhere near enough,” Pittman said. “His party controls all of Congress and the White House. Why has there been no movement whatsoever to bring down costs?”
Pittman said his frustration isn't limited to Republicans.
“I say this as a non-partisan. Lifelong Republican turned independent,” he said. “I belong to no party because once you realize that both are controlled by the special interests and lobbyists, you have an epiphany that it's all a game for career politicians to garner votes.”
What Happens Next?
The audit process isn't finished simply because FERC issued its findings.
Atlantic City Electric has accepted the recommendations and must carry out corrective measures, while FERC's audit staff monitors implementation. The utility must further analyze the findings involving its transmission revenue requirement and determine the appropriate financial consequences. FERC says its audit program continues monitoring recommendations until they are properly implemented.
For customers, that leaves a substantial gap between two statements that can sound similar but mean very different things:
FERC found that Atlantic City Electric overbilled transmission customers.
It has not yet been established that every — or any particular — South Jersey residential customer is entitled to a refund check because of those findings.
Van Drew says Atlantic City Electric now needs to determine whether those improper costs reached ratepayers and return any money that is owed. Atlantic City Electric says it is conducting the required analysis.
Pittman says he'll judge the outcome by what ultimately happens to customers' bills.
“I would love to see actual results,” Pittman said. “But I'm extremely pessimistic about those chances as we have had zero movement in two years.”
And despite his criticism of both political parties, Pittman said he isn't walking away from the issue.
“I will lend my voice and platform to anyone who wants to make a difference,” Pittman said. “Democrat, Republican or independent. I just won't be associated with empty promises and political agendas.”
About the Author
Paul Kelly
Paul Kelly is a contributor to LocalBeat, covering local news and community stories.
