PJM files proposal with FERC to update reserve pricing
PJM recently filed a proposal with the Federal Energy Regulatory Commission (FERC) to adjust its energy reserve pricing rules to “fairly value resources that play a vital role in the reliability of the bulk power grid.”
These reserves help to balance generation and demand during times of unexpected generation loss or increased electricity demand, PJM said. They also help in managing the variable output of generation resources like wind and solar.
PJM said that its current rules “do not accurately value reserves for their reliability nor drive consistent response when the resources are called upon.”
“PJM’s proposal represents a major step forward in the design of the market,” Stu Bresler, PJM’s senior vice president of operations and markets, said. “These resources are not just critical to reliability today and in the future, they will provide the backup flexibility needed so that the grid is prepared for the continued integration of alternative sources of energy.”
The proposed rules include separate pricing calculations for day-ahead and real-time markets. PJM noted that the concepts its proposed rules are based upon have been implemented and proven by other independent system operators and regional transmission organizations
PJM filed the proposal under Section 206 of the Federal Power Act after stakeholders could not reach the required two-thirds sector consensus on a proposal over the past year.
