Aftab Khan, PJM Interconnection Executive Vice President – Operations, Planning & Security, testified Oct. 16 about maintaining resource adequacy amid growing demand and operational complexity before the Federal Energy Regulatory Commission’s annual Reliability Technical Conference.
In the past, capacity auctions seamlessly facilitated the PJM generation fleet transition from mostly coal to natural gas as a result of EPA’s Mercury and Air Toxics rule, Khan said in his written testimony (PDF). That transition has resulted in a dramatic reduction of emissions from generators in PJM since 2005.
Today, the latest transition to lower-carbon resources, such as wind and solar, is complicated by changes in the technology and fuel of the generation mix; unprecedented growth in electricity demand, or load; government policies that are driving both generator retirements and new renewable and storage resources; and external hurdles to progress, such as supply chain bottlenecks.
PJM’s analysis, Energy Transition in PJM: Resource Retirements, Replacements & Risks (PDF), discussed how these trends may affect resource adequacy. In addition, thermal resources are exiting the system at a faster pace than new generation entry for reasons including project financing, siting and supply chain shortages.
As a result, PJM anticipates a possible generation shortfall by the end of this decade. Along the way, PJM expects to undergo a profound shift in grid operations and planning:
- Some 21% (40,000 MW) of PJM’s 192,000 MW installed generation mix is expected to retire by 2030.
- Generation fleet mechanics will shift from predominantly dispatchable thermal generators to mostly intermittent inverter-based resources, which have very different physical attributes, with limited dispatchability and contribution to voltage support, load following and stability. Because of these differences, multiple megawatts of new inverter-based generation are required to replace each megawatt of retiring thermal generation.
Serving Growing Load and Forecasting for the Future
As generation shifts, load is also changing and growing – sometimes in ways that introduce more complexity for operations and the long-term load forecast.
“For much of PJM’s recent history, load growth has been essentially flat,” stated Khan, noting that PJM’s annual peak load growth in the decade before 2024 was close to 0%. “That is no longer the case.”
PJM forecasts overall positive annual load growth for the foreseeable future. That said, behind-the-meter solar and storage – such as residential rooftop solar and/or batteries – will dampen some of the new demand as customers generate their own power during certain hours.
In his written testimony, Khan said that PJM reasonably predicts that:
- Data centers’ current 4% share of load will triple to 12% by 2030 and quadruple to 16% by 2039.
- Electric vehicles’ share of load, while currently negligible, will surge to 11% by 2039.
- More electric heating, promoted by government policy, will drive load growth.
Charting the Path Forward
As generation and transmission needs rise in step with growing load, PJM recognizes the need for balance among many competing interests. Tradeoffs for consideration include:
- Facilitation and implementation of federal and state energy policy while sharing clear information about reliability impacts
- Supporting the ability of the grid to reliably serve load growth, especially artificial intelligence, while addressing questions of affordability and social equity implicit in new load costs borne by captive, end-use customers
Maintaining resource adequacy is PJM’s primary purpose and a responsibility shared by FERC, policymakers, industry, customers and other stakeholders. PJM is working through these issues, Khan’s testimony said, in close collaboration with stakeholders and policymakers.