PJM market monitor pushes capacity market changes to enhance efficiency
PJM has many constituents, and it is not easy to keep them all happy. A group of electric cooperatives and municipal power providers, for instance, is pushing for a wide ranging reassessment of PJM’s capacity market. They are concerned that PJM’s capacity market gives short shrift to the policy goals of individual states.
PJM has apparently taken those concerns to heart, as the recommendations in the market monitor’s report include changes to PJM’s capacity market.
The report recommends, among other things, that energy efficiency resources be excluded on the supply side of the capacity market because PJM’s load forecasts now account for future energy efficiency, but did not when energy efficiency was first added to the capacity market.
The report also recommends that if PJM releases capacity in incremental auctions, are used as a true-up mechanism between the intervals auction periods, that the RTO should offer the capacity for sale at the capacity market clearing price in order to avoid suppressing the incremental auction price below competitive levels.
For demand response, the report recommends that PJM does not remove any defined subzone and maintains a public record of all created and removed subzones.