1 / 16

PJM ’ s Experience with Capacity Markets

PJM ’ s Experience with Capacity Markets. Terry Boston President & CEO PJM Interconnection Power Across Texas September 21, 2012. PJM ‒ Focus on Just 3 Things. 1. Reliability Grid Operations Supply/Demand Balance Transmission monitoring. Regional Planning 15-Year Outlook. 3.

gerd
Download Presentation

PJM ’ s Experience with Capacity Markets

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. PJM’s Experience with Capacity Markets Terry Boston President & CEO PJM Interconnection Power Across Texas September 21, 2012

  2. PJM ‒ Focus on Just 3 Things 1 • Reliability • Grid Operations • Supply/Demand Balance • Transmission monitoring • Regional Planning • 15-Year Outlook 3 • Market Operation • Energy • Capacity • Ancillary Services 2

  3. PJM: Who We Are KEY STATISTICS Member companies 800+ Millions of people served 60 Peak load in megawatts 163,848 MWs of generating capacity 185,600 Miles of transmission lines 59,750 GWh of annual energy 832,331 Generation sources 1,365 Square miles of territory 214,000 States served 13 + DC 21% of U.S. GDP produced in PJM As of 7/2012

  4. End-Use Customers 36 Other Suppliers 455 Generation Owners 175 Transmission Owners 63 Electric Distributors 52 PJM Governance Independent Board Members Committee 10/2012

  5. Capacity Resources Generation Demand Response (DR) Energy Efficiency

  6. Pre-2005 Trends Decreasing Prices / Increasing Generation Retirement Installed Reserve Margin After RPM Retired MWs Decreasing Reserve Margin / Increasing Reliability Violations Before RPM Projected Reserve Margin, % Reliability Pricing Market (RPM)

  7. Pre-2005 Capacity Market Issues • One price did not fit all • Not aligned with locational value • Not aligned with reliability • Not aligned to value provided • Insufficient information to drive investment • Short-term market / limited forward certainty • Insufficient time to build

  8. Why Forward Capacity Markets? • Transparent locational price signals show the ‘cost’ of reliability improvements ahead of the need • Resource commitments are obtained to meet peak loads 3 years in the future • Longer-term price signal and stable revenue stream for generation resources incent investment • Competition is promoted between alternative resources(Supply Side and Demand Side)

  9. Cumulative New Dependable Capacity 2007-2016 MWs

  10. Encouraging Demand Resources New Capacity Market (RPM)

  11. RPM Base Residual Auction Resource Clearing Prices (By Zone)

  12. Integrating New Infrastructure Over 16,000 MW of Pending Deactivations (~13,500 MW since 11/2011)

  13. Managing a Sea-Change PJM Installed Capacity Cleared

  14. Wholesale Power Cost

  15. PJM Load-Weighted & Fuel Cost-Adjusted LMP RPM Capacity Market

  16. Union Station ─ 1908

More Related