PJM CEO Ott outlines a reimagining of the grid in annual meeting keynote

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The PJM grid is more diverse and stronger than it has ever been, President and CEO Andy Ott told the Members Committee at the annual meeting on Wednesday. But, he said, “In the future, 10 years from now, I don’t think it’s enough.”

In keeping with PJM’s 2017 annual report, “A Step Beyond,” Ott outlined the characteristics of a grid reimagined for the future, and the steps underway to achieve it.

His vision, he said, includes a fair valuation of resources that contribute to resilience, fewer grid dependencies, fully integrated distributed resources and tightly coordinated transmission and distribution systems.

Toward this end, PJM and its stakeholders have embarked on several initiatives. They include advancing PJM’s value proposition, valuing resilience through the markets, incrementally improving operational resilience, leveraging the capabilities of distributed resources and increasing vigilance around security.

Resilience is the common thread woven through all of these efforts.

“We need to be able to take a hit and bounce back quickly,” Ott said. “We are much quicker than we have been historically, but we can be even better.”

He stressed, however, that he means cost-effective resilience – not resilience at any cost.

Ott also took a moment to review the value PJM offers society, even beyond its core mission of providing a reliable grid for more than 65 million people at the least reasonable cost.

The market signals PJM delivers has enabled it to become the most successful system in the world in promoting investments in infrastructure, new generation and technology, he said.

PJM also fosters a greener grid by providing opportunities for renewables to participate in the market and rewarding generator efficiency and availability. Using the markets, PJM has lowered emissions substantially over the past decade.

Finally, Ott spotlighted the independence PJM offers as an entity that can provide independent assessments and evaluation, along with the observations of its Independent Market Monitor.

Returning to the state of today’s grid, Ott said that the system performed admirably during this winter’s cold snap, reinforcing the effectiveness of improvements made since the 2014 Polar Vortex.

Generator performance was strong, and in the end, the system had plenty of capacity – enough, even, to help out our neighbors.

Building on that strength going forward, he reported 72,000 MW – an “astounding number” – of new generation being driven largely through the competitive wholesale market.

There also are $16 billion in new transmission projects underway or approved.

This investment and planning will counteract the 2,084 MW that retired in 2017 and another 13,358 MW – mostly coal and nuclear – scheduled for retirement over the next few years.

Ott closed his address by returning to resilience, an issue that PJM has been discussing for the past two years and which now has been thrust into the national spotlight.

“Let us as a community put facts on the table, analytical studies on the table, and define what we mean by resilience so that it doesn’t become this amorphous conversation,” he said.

“Our hope is that we as a stakeholder community can engage this conversation,” Ott said. “I need your help.”