FERC Rejects Illinois Municipal Electricity Agency Waiver From PJM Capacity Rules
On March 9, 2015, FERC rejected the Illinois Municipal Electric Agency’s (“Illinois MEA”) waiver from PJM Interconnection, L.L.C.’s (“PJM”) capacity rules for the 2018/2019 delivery year. As a result, the Illinois MEA cannot use a majority of generation located outside of the Commonwealth Edison Locational Delivery Area (“ComEd LDA”) to meet its capacity obligations of load located within the ComEd LDA.
Currently, Illinois MEA operates under PJM’s Fixed Resource Requirement (“FFR”) Alternative, rather than PJM’s capacity market. Under the FFR Alternative, a load-serving entity (“LSE”) such as Illinois MEA can elect to serve load within PJM through self-supply or bilateral agreements. To utilize the FFR Alternative however, Illinois MEA must file an FFR Capacity Plan that includes a minimum percentage of generation from within the affected LDA – in this case, ComEd LDA.