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E&E News: Largest Grid Operator Advances Overhaul of FERC Market Rule

Posted by Jeffrey Tomich on Jul 9, 2021

E&E News summarized a potential revamp of grid operation rules in parts of the U.S., quoting AEE’s Jeff Dennis. Read snippets below and the full article here.

The operator of the bulk power grid across parts of the Mid-Atlantic and Midwest is proposing to revamp controversial market rules — a change that could empower states to reshape energy policies to address climate goals.

The updated rules by PJM Interconnection LLC were approved by the grid operator's board yesterday and are expected to be filed with federal regulators by mid-month.

Changes to the MOPR in effect now were spurred by a 2019 FERC order that directed PJM to apply the price floor to renewable energy projects and nuclear plants supported by state subsidies. Previously, the price floor had been applied only to new natural gas units.

The revised MOPR would apply to resources that enter at deliberately lower prices to benefit the bidder's overall portfolio. It would also apply to generators that receive state subsidies specifically conditioned on clearing the capacity auction — but it wouldn't typically kick in under a range of other beneficial polices [sic].

Jeff Dennis, general counsel and managing director of Advanced Energy Economy, a clean energy trade group, said the PJM proposal won strong support among various interests in PJM and, if approved, should help quiet the MOPR debate.

"It removes a clear barrier to participation by advanced energy technologies like wind, solar, and energy storage, and other technologies that states have been supporting through their policies," Dennis said. "And it also allows us to move on to addressing some of the other issues that we need to see reformed in the PJM capacity markets to ensure that those resources can be fully integrated in future."

Dennis, a former FERC staffer, said the proposal wouldn't eliminate debate over state subsidies and the interplay with competitive markets. But it would make FERC the referee of those disputes and free up PJM to focus on other market design issues.

Read the full article here.

Topics: AEE In The News