This bill prohibits the Board of Public Utilities (BPU) from authorizing any rate increases for electric and gas public utilities that utilize inclining block rates for residential customers. An inclining block rate is a pricing structure that imposes higher charges once a customer's usage surpasses certain thresholds, regardless of the time of consumption. The bill aims to eliminate this outdated rate structure, which has been criticized for not accurately reflecting the actual costs of generating electricity and gas, as highlighted in a report prepared for the BPU.

The legislation mandates that the BPU shall not approve any rate increases for utilities that employ this pricing model, thereby protecting residential customers from potential hikes in their energy bills, particularly during peak usage periods in the summer. The BPU is also required to adopt necessary rules and regulations to implement this provision, ensuring a smooth transition away from inclining block rates. The bill is set to take effect immediately upon passage.