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Pepco Files Part II Of PJM Capacity Auction Task Force Report
In the District of Columbia Pepco filed Part II of the PJM Capacity Auction Task Force Report. The report states that “there was no consensus regarding any long-term recommendations for the Commission derived from the Task Force and there were no consensus positions reached by the working group.”
Positions of Stakeholders
“The Task Force Along with Commission staff met to discuss the Part II Report. The majority of stakeholder indicated that their preference was to draft their individual positions regarding the Task Force topics and matters discussed during the Task Force, and other positions related to the Tasks Force topics. The stakeholder positions are appended to this Part 2 Report as follows:
Task Force member positions:
- AOBA- See Addendum 1
- DOEE- See Addendum 2
- OPC- See Addendum 3
- Pepco- See Addendum 4
- PJM- See Addendum 5
Conclusion
“There were no consensus positions reached by the working group.”
In terms of Modifications to Standard Offer Service (SOS) Procurement Process Pepco presented potential modifications to the District’s SOS procurement process as discussion points, with the goal of improving price stability and reducing exposure to PJM capacity auction volatility.
Potential options in Pepco’s presentation covered:
- INC/DEC Load Adjustment Mechanism (Used in Maryland) – MD uses an INC/DEC mechanism based on customers’ Peak Load Contribution (PLC), limiting unexpected swings in supplier-served load.
- Reducing DC’s Two Annual Auctions to One – DC currently conducts two auctions (3-year forward for residential/small commercial; 1-year for large commercial).
- Shifting Capacity Cost Recovery from Summer to Winter – Proposals potentially redistribute or smoothes costs between seasons.
- Removing RPS (Renewable Portfolio Standard) Requirement From SOS Pricing (Bates White Proposal) – This would increase transparency by separating energy costs from RPS compliance costs. And allows more flexible REC procurement instead of tying REC purchases to SOS volumes.
The Task Force consists of OPC, Potomac Electric Power Company (“Pepco”), Department of Energy and Environment (DOEE), the Apartment and Office Building Association of Metropolitan Washington (“AOBA”), PJM Interconnection LLC, (PJM), DC Sustainable Energy Utility (“DCSEU”), and DC Office of the City Administrator.
As reported previously, the Task Force was directed to submit Part II of the recommendation report on what improvements might be made locally to address the impacts of the capacity auction on District consumers. The two-part recommendation report goal was to allow the Task Force to update the Commission on the discussions held on these initial topics, while allowing the Task Force to continue to discuss ideas related to the long-term issues surrounding the capacity auction.
More specifically, the Commission Staff had identified the four specific meeting topics the PJM Task Force meetings were to address in Part II of their report that included:
- Supply-Side Opportunities;
- Modifications to Standard Offer Service (SOS) Procurement Process;
- Demand-Side Solutions and Customer Programs; and
- Final Recommendations
FC1183 (12/09/2024)
(In The Matter Of The Investigation Into The Impact Of The PJM Capacity Auction And The Establishment Of The PJM Capacity Auction Task Force)
