PJM releases capacity market auction schedule, relevant deadlines

New York — PJM Interconnection staff detailed the grid operator's long-awaited capacity market auction schedule Nov. 19, confirming the Base Residual Auction for delivery year 2022/23 will be held in May 2021, with the 2023/24 auction following in December 2021.

PJM on Nov. 12 received "a relatively clean" forward energy and ancillary service offset order (EL19-58) from the Federal Energy Regulatory Commission which PJM had been waiting on to establish a timeline for its base capacity auctions, Pete Langbein, PJM's manager of demand response operations, said during a remotely held Markets and Reliability Committee meeting.

Traditionally held annually in May to procure resources three years ahead, PJM has not conducted a capacity auction since 2018 when FERC determined (EL16-49, EL18-178) PJM's capacity market rules were unjust and unreasonable due to their treatment of state-subsidized clean energy resources.

PJM received an order from FERC on Oct. 15 that approved the grid operator's plan for fixing the capacity market rules by imposing a minimum offer price rule, or MOPR, designed to level the playing field between resources receiving state subsidies and those that do not.

PJM Base Residual Capacity Auction Schedule

*Auction back to original schedule

Source: PJM

The Nov. 12 forward E&AS order asked PJM for one "minor" additional piece of information, Langbein said, but FERC gave PJM 15 days to make the compliance filing and provided the tariff language that should be included.

As a result, PJM "feels confident" that it can move forward with the actual BRA, Langbein said.

PJM will use the January 2021 load forecast for the upcoming BRA to be held in May 2021, and moving forward, PJM will use the latest January load forecast going into the base auction, he said.

The methodology is to hold the BRA's six months after posting the results to the prior BRA.

There are several key deadlines in January 2021, including one on Jan. 19 for resources seeking an exemption form the MOPR, according to a presentation shown during the meeting.

The BRA itself will run from May 19, 2021, to May 25, 2021, with the results posted on June 2, Langbein said.

All the preliminary MOPR prices are due by Dec. 20 and PJM will publish them on the PJM capacity market web page, he said.

Additionally, entities electing to leave the capacity market via the fixed resource requirement alternative need to submit their plans for procuring capacity outside the market by April 19, 2021.

PJM has also posted a detailed document with all the relevant capacity market planning deadlines on their website.