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With an unprecedented amount of electric generation retiring within the next three years, PJM Interconnection's capacity market secured record amounts of new generation, demand resources and energy efficiency to keep the grid reliable.
PJM has announced the results of its capacity market, the annual Reliability Pricing Model (RPM) auction, for resources to meet power supply needs between June 1, 2015, and May 31, 2016. The RPM auction procured a record amount of new generation in one year, 4,900 megawatts (MW). In addition, capacity imported from west of PJM increased about 8 percent from last year to 4,335 MW.
The RPM establishes contracts with power producers who commit to make their facilities available to provide electricity for the PJM system for a year. Prices are established through competitive bidding. PJM's auction also includes demand response and energy efficiency providers.
This year, the auction procured 164,561 MW of capacity resources at a base price of $136 per MW. A megawatt is enough electricity to power 800 to 1,000 homes. PJM's all-time peak demand is 158,448 MW. Prices were higher in northern Ohio and...