Browsing by Subject "PJM"

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Open Access
A Guide to Inform Institutions about Participation in PJM’s Demand Response Programs
(2013-04-21) Aldina, Robin; Soden, John
Increasing reliability concerns over the last decade have led stakeholders within the Energy Industry to place a great deal of attention on the management of electricity load. Traditionally, consumers have been shielded from the price signals that indicated high stress on the electricity grid, but through a process known as Demand Response (DR), customers are now being offered incentives to actively manage their load for increased reliability. Attention on DR has grown with its profusion into electricity markets; at both the wholesale and retail levels. Focusing on institutional customers and DR programs within the PJM wholesale electricity market, this study provides a comprehensive resource to answer questions associated with (1) the regulatory structure of PJM’s markets for DR and (2) the possible benefits that can result from market participation. As a first step in addressing these objectives, this report first provides an analysis of the current publically available information, and establishes that there is no single resource that provides sufficient information to resolve all the questions an institution may have. This report then offers clear and concise content by which institutional customers can assess the framework of PJM’s DR programs. Further, a tool for estimating the potential revenue available from participation in the capacity auction was created to help institutions understand the profitability of engaging in the capacity market. Finally, this report concludes that while participation in PJM’s demand response programs is a complicated undertaking, there are a wide variety of options available to meet the unique needs of individual customers, as well as significant financial incentives.
Open Access
Assessing the Implications of PJM Interconnection Capacity Market Reforms to State Energy Resource Transitions
(2021-04-26) Landes, Christopher
States are increasingly adopting policies which create supplemental revenue streams to advance energy priorities. Although the policies are effective at increasing or protecting specific resources, they distort the competitive nature of organized electricity markets. To remedy these price suppressing distortions, PJM Interconnection will expand the Minimum Offer Price Rule to require all state subsidized resources offer into the capacity market at a default minimum price. Through qualitative and quantitative analysis, this paper evaluates the impact of proposed capacity market reforms to new and existing capacity resources as well as the implications to state energy objectives. The analysis demonstrates that Minimum Offer Price Rule expansion will provide administrative pricing reform but will create challenging market conditions for new capacity entrants and renewable technologies while bolstering existing capacity units and fossil technologies. Further, existing nuclear units are unlikely to clear future capacity market price floors; thus, increasing the likelihood that these units will retire early. Since these policies acknowledge negative externalities, a coordinated subnational or national carbon price would be a more equitable method to reform the capacity market and incorporate state energy priorities.