Author: l     Published: 9/3/2019   Utility Dive

PJM’s proposal to prevent state energy policies from affecting market prices is one of several high profile issues that could see advancement at the Federal Energy Regulatory Commission (FERC) with the Aug. 31 retirement of Commissioner Cheryl LaFleur.

But that policy could increase costs in PJM’s $10 billion capacity market by $5.7 billion a year, according to a study released Wednesday by Michael Goggin and Rob Gramlich, vice president and founder, respectively, of consulting firm Grid Strategies.

The report is a way to account for FERC and Regional Transmission Operator (RTO) interference, Gramlich, former advisor to ex-Commissioner Pat Wood, said in an email to reporters. By attempting to remove the market influence of state subsidies, the price floor for capacity auctions would increase and lead to higher near term capacity price charges in customer bills. Grid Strategies’ study says customers in the PJM area would pay on average $6 more on their monthly bills under PJM’s proposal.

“PJM’s markets are currently facing a complex scenario where one state’s policy choices are impacting other states that may not have the same policy view.”

Susan Buehler Spokesperson, PJM Interconnection