Investor-owned utilities call for ending ‘overreliance’ on PJM capacity market

Core Insights - The Edison Electric Institute (EEI) is advocating for reforms in the PJM Interconnection's capacity market to address rising capacity prices and ensure adequate power supplies amid increasing demand, particularly from data centers [3][5][6] - Utility companies like Exelon, FirstEnergy, and PPL Corp. are seeking to re-enter the generation business in states where they were previously required to divest their power plants [4] - EEI emphasizes the need for utilities to have a more central role in decision-making within PJM to enhance reliability and reduce cost uncertainty for ratepayers [5][6] Group 1 - EEI's letter highlights concerns over the effectiveness of PJM's capacity market in meeting rising demand despite significant increases in capacity prices in recent auctions [3][6] - The organization calls for a reduction in reliance on the capacity market and suggests that states and utilities should take a more proactive approach in power supply procurement [6] - EEI president Drew Maloney stresses the importance of timely decision-making among stakeholders to address reliability risks and meet customer needs [5][6] Group 2 - Stakeholders owning grid assets must drive outcomes, and the decision-making process needs to be expedited to avoid exposing customers to reliability risks [6] - The letter from EEI suggests exploring various methods to build generation capacity, including regulated generation and improved self-supply frameworks [6]