The Federal Energy Regulatory Commission on Sept. 1 issued the results of its wide-ranging audit of various elements of PJM’s markets, operations and planning over a five-year period.
FERC’s comprehensive review looked at PJM’s compliance with its Tariff and Operating Agreement, business practices, bylaws, policies, and market-related codes of conduct, and also with various FERC orders.
After reviewing PJM’s practices and data between January 2016 and May 2021, FERC’s Audit Report identified a single instance of noncompliance. This involved one 18-hour period in 2019 in which PJM did not properly offer-cap a self-scheduled generator in the Day-Ahead Market.
“While we always strive for perfect compliance, this is an important achievement that reflects the incredibly strong culture of compliance at PJM and validates our emphasis on compliance in all aspects of our business practices and operations,” said PJM President and CEO Manu Asthana. “The scope of this audit was enormous and touched many areas of our organization. It examined our compliance with thousands of pages of governing documents and required a significant investment of time and resources from PJM staff.”
As part of the audit, FERC issued a series of 20 recommendations regarding offer-capping, day-ahead resource commitment, incentives to follow dispatch, software issues, and FERC Order 760 (involving the reporting of market data to FERC). PJM has already begun work on improvements in most of these areas and will begin enhancements on the remaining areas as part of our response to the audit. “The FERC audit report confirms not only PJM’s culture of compliance, but also PJM’s culture of teamwork,” said Chris O’Hara, Sr. Vice President, General Counsel, Secretary and Chief Compliance Officer. “This was an organization-wide effort, and we are proud of the results.”