PJM Backs Use of Marginal Emission Rates Data Tool in Comments to the SEC

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PJM has filed comments in response to the Securities and Exchange Commission’s proposed rule to enhance and standardize climate-related disclosures for investors.

The proposed rule changes, announced March 21, would require registrants to include certain climate-related disclosures in their registration statements and periodic reports, including their greenhouse gas emissions. The comment period ended Friday.

In its comments, PJM takes no position on the merits of the proposed rule, but “supports the SEC’s flexibility and openness to allowing registrants to include alternative methods for calculating certain greenhouse gas emissions for purchased electricity in any new SEC disclosure requirements.”

PJM, with its stakeholders, continues to develop and refine methods for determining emissions data that could be useful under the new rule, according to the comments.

In September 2021, PJM added 5-Minute Marginal Emission Rates to the public information available on its Data Miner tool.

A marginal unit is the unit responsible for providing the next increment of energy at a specific location and time, taking into account transmission system congestion-loss costs and energy costs. Marginal units may increase or decrease output in response to changes in demand.

“As such, in some situations, the marginal units, and hence the marginal emission rates, can provide an indication of what would happen based on a change in consumer behavior and therefore potentially provides more actionable information for consumers and investors than simply average emissions data,” the filing says.

The data stream enables viewers to identify periods of high emissions by the marginal generating unit, which can help them better understand the impact of their electricity use.

Using this data, some companies may decide, for example, to reduce power consumption or use stored energy to reduce emissions.

Last year, General Motors, in partnership with PJM member TimberRock, announced plans to use PJM’s marginal emission rates data to help it reach 100% renewable energy to power its operations by 2025, five years earlier than previously announced. Eventually, according to GM, the initiative is expected to expand to include the carbon emissions associated with customers’ electric vehicles.

“PJM anticipates other stakeholders will explore similar uses for PJM’s marginal emissions data stream,” according to PJM’s comments.  

As the availability of marginal emission rates data grows and investors find it useful, it could encourage the publication of such data across the nation. Fostering the evolution of such enhanced methods could lead to lower production costs while better informing business decisions related to electricity consumption and emissions, PJM said.