Your connection to the latest in electricity, natural gas, and utilities news.
In this Issue:
PJM
PJM asks FERC to halt energy efficiency payments
PJM sought approval from the Federal Energy Regulatory Commission to halt energy efficiency capacity payments, saying there was no evidence they encouraged efficiency projects. Consumers that install efficiency measures already benefit from lower capacity costs, the grid operator said, through reduced peak load obligations from cuts in energy consumption.
PJM’s record capacity price auction sends “build signal”
Record high prices in PJM’s recent capacity auction could spur reconfigurations in retail demand response, battery, and distribution efforts. Prices surged to almost $270 per megawatt-day for the 2025-2026 delivery year and could rise even higher. “These results will get noticed,” said the head of a power producers’ trade group. “It’s a build signal.”
PJM looking to fast-track “shovel-ready” generating projects
PJM is considering a process that would fast-track shovel-ready generating projects through the interconnection process. The grid operator expects generators will develop new supply in response to high prices from its recent capacity auction. The proposal comes amid tightening supply-demand conditions and concerns about potential capacity shortfalls later this decade.
Market monitor says capacity auction marred by design flaws
PJM’s market monitor said that the grid operator’s recent capacity auction was affected by market design flaws, including one that allowed generation owners to boost prices by wielding their market power. The switch in how power plant availability is measured contributed to an increase in revenue of about $4.4 billion – or nearly 50 percent – compared to the former metric.
PJM rejects calls to include reliability must-run resources in capacity auctions
PJM rejected calls to include generational resources with reliability must-run contracts in future capacity auctions. The grid operator’s rules do not require that a deactivating resource take part in an auction. It said mandating that those resources participate could distort price signals, impede new generation, and hinder existing generators from spending on cleaner technologies.
Calpine to explore new locations for adding generation capacity
Calpine will explore multiple new locations for generation capacity, especially in Ohio and Pennsylvania, in response to soaring energy prices within the PJM footprint – and consider expanding its current fleet. An executive said the grid operator’s recent auction, which saw prices hit $269.92 per megawatt day, sent a signal to boost spending on new and existing sources.
Expert offers five moves for PJM in wake of record capacity auction prices
PJM’s July capacity auction, which saw record-setting prices amid tightening resources, sent a clear message to suppliers, said a top regulatory consultant and ex-head of the Pennsylvania Public Utility Commission: “(W)e need you to stay, and we need you to bring some more friends.” He offered five actions PJM can take to ensure reliability and market efficiency.
State Regulatory Developments
California sets procurement process aimed at enhancing clean energy resources
The California Public Utilities Commission established a centralized procurement framework designed to enhance the state’s clean energy resources. The Department of Water Resources will be the sole agency to secure the resources, a move expected to streamline the purchase of advanced energy resources on behalf of ratepayers.
Texas approves 17 projects under new state energy fund
The Public Utility Commission of Texas approved 17 power projects for due diligence under the state’s new Texas Energy Fund. The projects comprise 9,781 megawatts of potential generation and would result in $5.38 billion in loans. The commission selected from among 72 applicants, prioritizing speed to market and ability to relieve identifiable transmission constraints.
New model proposed for generation interconnection process
The former head of the Arkansas Public Service Commission said the current generation interconnection process is leaving proposals for low-cost energy projects in limbo and choking economic development. His solution: an entry-fee model with an up-front, flat-fee approach to interconnection, with providers determining costs for customers before getting in the queue.
Report: Climate goals, not just energy savings, should drive efficiency efforts
A new report offers recommendations for how state legislators and regulators can broaden the scale and scope of energy efficiency programs to deal with climate change. It said climate goals – not just energy savings – should fuel utilities’ focus on efficiency, describing how states and utilities can ensure their programs adopt climate-related impact metrics and track their progress.
Head of grassroots solar opposition group tied to fossil fuels interests
The head of an anti-solar group admitted that a well-connected natural gas executive is among the organization’s biggest donors. His testimony, before Ohio regulators, provided a close look at the group’s connections to fossil fuel interests, appearing to undermine claims that it is a grassroots advocate for farmers and local residents.
Nuclear
Landmark federal nuclear legislation seen as most substantial in years
A landmark law is being praised as the most substantial piece of federal nuclear legislation in years. It calls on the Nuclear Regulatory Commission to state it will not “unnecessarily limit” civil use of nuclear technology; cuts some licensing fees; speeds review of reactor applications for existing sites; and paves the way for more efficient microreactor licensing.
In shift, environmentalists begin to embrace nuclear
While activists have long targeted nuclear energy, there are signs of increasing support among environmentalists. They have begun to acknowledge the resource’s benefits, including no pollution and no carbon emissions, and are rethinking concerns about costs, waste, and safety. As such, nuclear is now perceived as a crucial part of a wider zero-carbon energy future.
Energy Industry in Transition
Trend toward utility rate increases in regulated markets continues
The trend toward increases in utility rates in regulated markets has continued into 2024. State regulators approved $9.7 billion in net increases last year – more than a third going to a pair of California utilities – and from the start of 2023 through August 2024, they have authorized 58 percent of requests. If that ratio holds, increases are set to hit $8.8 billion.
Discussion over future of the grid seen shifting
For years, the discussion over the future of the electric grid focused on how inexpensive it would be or how “out of political favor” resources would be replaced with more politically favored resources without creating disruptions or reliability problems. But that narrative has changed, the head of an industry trade group argues, and he pointed to three reasons for the shift.
Clean energy leader urges utilities to act boldly amid major sector transformation
A leading clean energy adviser said challenges utilities face are coming from all sides. He added that that the sector is “in the midst of one of the greatest economic transformations of the modern era” and incremental change “just won’t cut it anymore.” Utilities that understand the change and act boldly, he said, will be the ones that emerge successfully from the energy transition.