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Study Finds that PJM Can No Longer Deliver Reliable Service at Lowest Cost
Calls for Needed Reforms
NJBPU has released an in-depth study that finds the capacity market run by regional grid operator PJM Interconnection (PJM) can no longer deliver reliable power at the lowest possible cost, and that calls for reforms to improve it.
The report advances Governor Sherrill’s affordability agenda by confronting the root cause of recent bill increases.
The report, titled “An Investigation of PJM’s Capacity Market,” comes as New Jersey electricity bills jumped roughly 20 percent last year, driven in large part by rising costs in PJM’s capacity market. Capacity charges account for about 15-20% of a typical customer’s electric bill, the single largest cost component the NJBPU cannot directly set, regulate, or change.
The recommended reforms call for data centers to pay their fair share across the 13-state PJM region, while modernizing PJM’s markets to better reflect real-world conditions and protect ratepayers from price volatility. They also seek to make it easier to finance new power generation and give states a clearer path to secure long-term energy resources without unnecessary regulatory barriers.
NJBPU will use this framework to advance reforms and champion ratepayer interests with PJM and the Federal Energy Regulatory Commission (FERC).
The full report is available here, and you can read more in the press release.
