Public Service Enterprise Group NYSE: PEG reaffirmed its full-year 2026 operating-earnings outlook after reporting second-quarter results supported by utility infrastructure investments and improved performance at its power business.
The company reported second-quarter net income of $0.67 per share, compared with $1.17 per share a year earlier. Non-GAAP operating earnings rose to $0.86 per share from $0.77 per share in the prior-year quarter. For the first half, PSEG reported net income of $2.15 per share and non-GAAP operating earnings of $2.41 per share.
Chair, President and CEO Ralph LaRossa said investments in system replacement, reliability and energy efficiency were major drivers of second-quarter financial growth. At PSEG Power, higher realized market prices, greater nuclear generation and gas operations more than offset the expiration of Zero Emission Certificate programs in May 2025.
PSEG maintained its 2026 non-GAAP operating-earnings guidance of $4.28 to $4.40 per share and reaffirmed its outlook for 6% to 8% annual operating-earnings growth through 2030.
Utility investments and storm response
PSE&G recorded second-quarter net income and operating earnings of $342 million, up from $332 million in the year-earlier quarter. CFO Dan Cregg said results reflected continued investment in energy efficiency and gas-system modernization. Distribution margin increased by $0.05 per share year over year, largely due to incremental gas margin from GSMP 2 extension roll-ins and higher energy-efficiency investment.
The utility invested approximately $1 billion during the quarter and remains on track to spend about $4.2 billion in regulated capital investments during 2026. Its five-year regulated capital plan remains $22.5 billion to $25.5 billion through 2030.
LaRossa also highlighted PSEG’s response to severe weather over the July 4 holiday weekend. Heat waves and successive thunderstorms with winds exceeding 70 miles per hour affected the service territory, and the company reconnected about 380,000 customers. Nearly all affected customers were restored within 24 hours, according to LaRossa.
The restoration effort involved more than 330 crews and more than 10 million proactive customer communications. PSEG said it will submit a post-event performance report to the New Jersey Board of Public Utilities on Aug. 5 and supports the agency’s review of the response.
During the heat wave, PSE&G reached a peak summer load of 10,446 megawatts, its highest level in 14 years. The company activated demand-response programs during three events in early July. LaRossa said PSEG’s Clean Energy Future programs generate more than $1 billion in annual customer savings and have helped nearly 525,000 residential and business customers reduce energy use and bills since October 2020.
Rate-case and regulatory outlook
PSEG said PSE&G now expects to file a base-rate case by the end of 2026, earlier than the 2029 deadline established in the utility’s prior base-rate settlement. LaRossa said the potential earlier filing reflects significant additions to distribution rate base and fewer infrastructure investment programs that provide accelerated recovery.
The timing also coincides with New Jersey’s review of the electric-utility business model under Governor Sherrill’s Executive Order 1. A consultant report released by the BPU included examples of multi-year rate plans, performance-based rates, performance metrics, earnings-sharing mechanisms, decoupling and shared-savings mechanisms.
LaRossa said PSEG does not expect many elements of that framework to be incorporated directly into the upcoming rate filing, but said a base-rate case would help establish a foundation for later regulatory changes. PSEG expects to submit comments in the next phase of the BPU process by Sept. 18.
The company also cited customer-affordability actions, including residential bill credits and an ongoing 12-month refund of approximately $166 million in Zero Emission Certificates. PSE&G has filed to reduce residential gas bills by more than 5% beginning Oct. 1.
PSEG said a PJM filing at the Federal Energy Regulatory Commission is expected to produce about $33 million in benefits for its zonal transmission customers from June through year-end 2026, with an expected annual benefit of approximately $65 million going forward.
Nuclear performance and generation opportunities
PSEG Nuclear produced 7.8 terawatt-hours of carbon-free baseload generation in the quarter and achieved a 92% capacity factor. The performance included Salem Unit 2’s second consecutive breaker-to-breaker run, LaRossa said.
In PJM’s latest capacity auction, PSEG Nuclear cleared about 3,600 megawatts of eligible nuclear capacity at $325 per megawatt-day for the period running from June 1, 2028, through May 31, 2029. That was modestly below the $333 per megawatt-day result in the prior auction.
LaRossa said PSEG Power has submitted several proposals in PJM’s bilateral Reliability Backstop Procurement process for potential dispatchable generation projects that could be paired with large new loads under bilateral contracts. Management did not disclose prospective project returns, emphasizing that any investment would need to have a utility-like or sufficiently contracted risk profile.
The company is also evaluating opportunities related to existing nuclear output, possible nuclear uprates and other generation projects. New Jersey’s Power in New Jersey Act established a BPU nuclear procurement process for at least 1,100 megawatts of capacity. PSEG said its Salem County site holds an early site permit from the Nuclear Regulatory Commission, though LaRossa described new nuclear as a longer-term solution because such projects can take about 12 years to develop.
PSEG ended June with $3.4 billion in available liquidity, including about $200 million in cash. In June, the company issued $500 million of 4.8% senior notes due in 2031 and used the proceeds to prepay a $500 million term loan. Management said its balance sheet supports its $24 billion to $28 billion total five-year capital plan without new equity issuance or asset sales.
About Public Service Enterprise Group (NYSE:PEG)
Public Service Enterprise Group NYSE: PEG is a diversified energy company that operates primarily in New Jersey. Its core businesses include a regulated utility that delivers electric and natural gas service to residential, commercial and industrial customers, as well as generation and energy services operations that participate in wholesale power markets. The company's activities encompass transmission and distribution, power generation operations, and related energy infrastructure services.
The regulated utility arm, Public Service Electric and Gas Company (PSE&G), is responsible for owning and maintaining electric and gas networks, connecting customers, performing meter and billing services, and managing system reliability and storm response.
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