Sunday, October 15, 2023

PJM Interconnection Formally Files Changes To Electric Capacity Market Rules With FERC Based Largely On Unreliability Of Natural Gas-Fired Power Plants During Winter Storm Elliot

On October 13, the
PJM Interconnection formally submitted proposed electric market reforms designed to support reliability of the electric grid now and in the future amid increasingly extreme weather and a changing generation fleet.

One of the most significant changes is "enhance resource accreditation" that would more accurately assess the reliability value of natural gas-fired power plants which accounted for 70% of the power plant outages in PJM during Winter Storm Elliot.

PJM filed its proposal with the Federal Energy Regulatory Commission after more than a year of stakeholder meetings followed by an accelerated and intensive stakeholder process that began in February.

Capacity market enhancements to the PJM Tariff aim for implementation beginning with the 2025/2026 Base Residual Auction (BRA), scheduled for June 2024. The proposed reforms are designed to:

-- Enhance how PJM accounts for generator reliability-related risk in its models and sets procurement targets.

-- Advance an accreditation framework for all resources to reflect the actual capacity value that those resources provide to consumers.

-- Reform certain rules related to the Capacity Performance program, which establishes accountability for generator performance during system emergencies.

-- Improve generator testing, including operational and seasonal requirements.

-- Revise the Market Seller Offer Cap and Minimum Offer Price Rule to better include costs of taking on a capacity obligation and adopt a forward-looking Energy & Ancillary Services Offset.

-- Enhance rules related to a unit-specific Market Seller Offer Cap.

-- Better align Fixed Resource Requirement rules with the capacity market construct.

The proposal reflects stakeholder collaboration that began in October 2021 with the establishment of PJM’s Resource Adequacy Senior Task Force. 

Following more than a year of stakeholder meetings, in February of this year, the PJM Board initiated an accelerated Critical Issue Fast Path – Resource Adequacy process that concluded in September with an advisory vote to inform PJM Board action.

“PJM and the PJM Board thank stakeholders for their focused consideration of market reforms designed to support resource adequacy and grid reliability,” said PJM President and CEO Manu Asthana. “The grid is evolving, and our markets must also adapt to facilitate the energy transition without sacrificing reliability.”

“The proposal, while enhancing reliability, would maintain fundamental principles of competition that control costs for consumers as well as incentivize investment in new resources,” said PJM’s Adam Keech, Vice President – Market Design & Economics.

“These proposed capacity market reforms will help PJM do what we do best – operating markets that attract critical investment in the resources we need to keep the lights on,” added Keech. “Maintaining enough resources that can support reliability are crucial to PJM’s ability to serve demand through the transition to a less carbon-intensive grid.” 

PJM recognizes stakeholder interest in continuing targeted collaboration on additional market enhancements, including a more granular approach to the capacity market, and will engage with stakeholders in pursuing these areas through various stakeholder venues.

Click Here for the complete announcement.

The PJM Interconnection PJM is a regional transmission organization that coordinates the movement of wholesale electricity in all or parts of 13 states and the District of Columbia, including Pennsylvania.

Related Articles - PJM Generator Nonperformance:

-- PJM Interconnection Board Proposes Market Reforms Based Largely On Unreliability Of Natural Gas-Fired Power Plants During Winter Storm Elliot  [PaEN]

-- Federal Energy Regulatory Commission, NERC Final Report On Winter Storm Elliott Says Legislative Action Needed To Establish Reliability Rules For Natural Gas Infrastructure   [PaEN]

-- PJM Interconnection Hears Testimony On Making Electricity Market Reforms To Address Nonperformance Of Natural Gas And Other Generators During Winter Storm Elliot; Transition To Clean Energy [PaEN]

-- PUC Vice Chairman [Now Chair]: During Winter Storm Elliot We Learned Natural Gas Can Be An Intermittent Generator Of Electricity Just Like Renewables   [PaEN]

-- PJM Interconnection Reports Higher Percentage Of Natural Gas-Fired Electric Generation Outages Than Originally Thought During Winter Storm Elliott - 70%  [PaEN]

-- S&P Global: Federal Inquiry Finds Same 3 Causes Driving U.S. Electric Generation Outages In Extreme Cold - Reliability Of Natural Gas System Remains A Concern   [PaEN]

-- Senate Hearing: Wholesale Electricity Prices Too Low To Support Coal, Natural Gas Power Plants In Market; Natural Gas Reliability Issues Will Continue   [PaEN]

-- Senate Hearing On Electric Grid Reliability: Natural Gas Continues To Have Reliability Problems; Renewables Aren’t Coming Online Fast Enough; Energy Office To Be Proposed   [PaEN]

-- PJM This Week Sends Penalty Assessments Of Up To $2 Billion To Electric Generators That Failed To Perform During December’s Winter Storm Elliot; Natural Gas Power Plants Had 63% Of Outages   [PaEN]

-- PJM’s Preliminary Review Of Christmas Storm Electric Generation Failures Shows Natural Gas Units Failed To Provide Power At Over Triple The Rate Of Other Generation   [PaEN]

-- PJM Interconnection Files Proposed Winter Storm Elliot Settlement With Nonperforming Electric Generators With FERC, Requests Final Action By Dec. 29  [PaEN]

PA Oil & Gas Industry Public Notice Dashboards:

-- Pennsylvania Oil & Gas Weekly Compliance Dashboard - October 7 to 13 - More Abandoned Conventional Wells; Spills; Venting Gas; Emergency Well Plugging  [PaEN]

-- PA Oil & Gas Industrial Facilities: Permit Notices/Opportunities To Comment - October 14 [PaEN] 

-- DEP Posted 55 Pages Of Permit-Related Notices In October 14 PA Bulletin  [PaEN]

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-- Vice Chair Of DEP Citizens Advisory Council Asks DEP To Report On University Of Pittsburgh Study That Found At Least 800,000 Tons Of Oil & Gas Production Waste Sent To Landfills Was Unaccounted For In One Year  [PaEN]

-- DEP Reports Shale Gas Operations Sent Over 138,000 Cubic Feet Of Radioactive TENORM Waste To Low-Level Radioactive Waste Facilities For Disposal In 2022 - Over  911,000 Cubic Feet Since 2017  [PaEN]

-- DEP Invites Comments At Nov. 14 Hearing On Air Quality Permit For Energy Transfer Natural Gas Liquids Marcus Hook Terminal In An EJ Area, Delaware County  [PaEN] 

-- Better Path Coalition: Oct. 18 Webinar Launching 9th Compendium Of Scientific, Medical Findings Demonstrating Risks, Harms Of Natural Gas Development, Infrastructure  [PaEN]

-- Sierra Club's Delaware County Team Hosts Oct. 16 Webinar On Lawsuit Challenging Law Preventing DEP From Protecting Public Health, Environment From Abandoned Conventional Oil & Gas Wells  [PaEN]

-- House Committee Meets Oct. 16 On Cryptocurrency Mining Moratorium Bill; Resolution To Study Potential Of Geothermal Energy From Abandoned Mine Pools  [PaEN] 

-- PJM Interconnection Formally Files Changes To Electric Capacity Market Rules With FERC Based Largely On Unreliability Of Natural Gas-Fired Power Plants During Winter Storm Elliot  [PaEN]

-- DOE Awards Natural Gas-Based Hydrogen Hub In Western PA, Renewable/Nuclear Power-Based Hydrogen Hub In Eastern PA; Reactions  [PaEN]

NewsClips This Week:

-- The Allegheny Front: After Fayette County’s First Oil, Gas Wastewater Injection Well Permit Was Withdrawn From EPA; Residents Worry There May Be More To Come

-- TribLive: Some Plum Boro, Allegheny County Residents, Activists Push Back Against 2nd Oil, Gas Wastewater Injection Well

-- Post-Gazette: Plum Boro, Allegheny County, Environmental Group Go To Commonwealth Court Trying To Stop New Oil, Gas Wastewater Injection Well

-- Inside Climate News: Plum Boro, Allegheny County, Environmental Group Go To Commonwealth Court Trying To Stop New Oil, Gas Wastewater Injection Well

-- Pittsburgh Business Times: Plum Boro, Allegheny County Residents Battle Penneco, Zoning Board Over Oil, Gas Wastewater Injection Well

-- Warren Times: Land-For-Shale Gas Deal Between Game Commission, PA General Energy Will Result In New State Game Land In Warren County

-- PA Physicians For Social Responsibility: MarkWest Carpenter Natural Gas Compressor Station Natural Gas Leaks In Washington County [Video]

-- Observer-Reporter: Local Couple First Natural Gas Leaseholders To Contribute To Giving Fund Account Created By EQT Natural Gas At Washington County Community Foundation  [EQT Matches Donations]  [Check EQT’s DEP Compliance Record here. ]

-- Observer-Reporter: Range Resources Welcomes 150 Female Students To Annual Power Of Her Event  [Check Range Resources DEP Compliance Record here.

-- Reading Eagle: Chocolate Company Pushes Back Against OSHA Finding Company Was Responsible For Deaths From Natural Gas Explosion

-- The Daily Item Letter: Fossil Fuels Have A History Of Being Unreliable

-- Warren Times: Gasoline Prices Fall In Region, But Not In Warren County  [In Middle Of Conventional Oil Drilling Country]

[Posted: October 15, 2023]  PA Environment Digest

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