PJM and stakeholders have begun a formal, accelerated process, as directed by the PJM Board of Managers, to develop and propose changes to the capacity market’s Minimum Offer Price Rule, commonly called the MOPR.
The goal is to file proposed modifications with the Federal Energy Regulatory Commission in July to effect changes in time for the 2023/2024 Delivery Year Base Residual Auction, to be held in December. Proposed changes would better accommodate the evolving resource mix and state energy policies.
Stage 1 of the Critical Issue Fast Path (CIFP) stakeholder process began April 28, with discussion of the problem statement and issue charge, as well as review of an initial PJM proposal to modify the MOPR. The conversation was followed by a session on the Market Seller Offer Cap.
Dave Anders, Director – Stakeholder Affairs, also announced a fifth Capacity Market Workshop, scheduled for May 13, to discuss the scope and timing for a process to resolve capacity market issues unrelated to the MOPR.
This stakeholder process is the culmination of four capacity market workshops held in February and March. It is the first use of the CIFP, a process members created in 2019 to resolve issues that are contentious or time sensitive. The CIFP process is outlined in PJM Manual 34, Section 8.6.4.
The PJM Board ultimately will decide what proposal to file with FERC. The Board has issued guiding principles meant to inform stakeholder action, stating that any final proposal should:
- Function to help support reliability
- Respect and accommodate state resource preferences and facilitate competitive, least-cost procurement
- Be flexible in design, thus ensuring the long-term viability of the market
- Embrace competitive principles and send appropriate price signals for efficient entry and exit
- Ensure appropriate mitigation of market power
In addition to these principles, and consistent with the problem statement, PJM also seeks to better accommodate self-supply business models
How It Works
The schedule calls for PJM and stakeholder development of options in Stage 2, consisting of three meetings in May.
In Stage 3 – two meetings in June – proposals will be finalized.
Stage 4 will be accomplished in a final meeting the morning of June 30, followed by a vote at the Special Members Committee meeting later that day. Board review will ensue, along with feedback to members and a filing expected on July 16.