FERC Grants PJM Waiver to Delay Capacity Auction

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On Aug. 30, FERC granted PJM’s request to delay its 2019 capacity market auction by three months in order to allow time to implement rule changes ordered by the Commission to address the impact of state energy subsidies on PJM’s capacity market.

PJM on Aug. 13 requested to delay the base residual auction for the 2022-23 delivery year from May 2019 to August. In the request, PJM stated that unique circumstances justified the proposed delay, since the Commission found in June that certain existing Tariff rules governing the auction are unjust and unreasonable.

The June order from FERC also instituted a paper hearing under Section 206 of the Federal Power Act to determine the just and reasonable replacement rate.

The Organization of PJM States, Inc. filed a motion on July 27, 2018, to extend the deadline for submitting initial testimony and reply testimony in the paper hearing from August. Those deadlines have been extended to Oct. 2 and Nov. 6, respectively. The OPSI request prompted the change in paper hearing deadlines.

PJM also asked to postpone the Feb. 1 date for releasing the variable resource requirement curves to be used in the auction as well as the preliminary PJM region peak load forecast for the delivery year.

Financial Transmission Rights Auction Ruling

On Aug. 31, FERC accepted revisions to PJM’s long-term financial transmission rights auctions that will institute new auction rules.

The rules will eliminate the three-year long-term FTR auction product and adjust the treatment of auction revenue rights. PJM filed the changes with FERC in July.

As part of the filing, PJM proposed eliminating the three-year long-term FTR auction product because of historically low bidding activity. PJM believes that the changes would also increase FTR software efficiency.

PJM also said that eliminating the three-year product will not decrease participant flexibility, however, since auction participants may still purchase FTRs for each of three planning periods covered by a given auction.

The changes were implemented in PJM ’s long-term FTR auction which began Sept. 4.