Statement From EPSA President and CEO Todd Snitchler on EPSA’s Protest and Affidavit Filed in Response to PJM Interconnection MOPR Reform Proposal
For Immediate Release: August 20, 2021
Contact: Christina Nyquist | cnyquist@epsa.org
Washington, D.C. – The Electric Power Supply Association (EPSA), which represents competitive power suppliers, today filed a protest and expert affidavit at the Federal Energy Regulatory Commission (FERC) calling on the Commission to reject PJM Interconnection’s proposed revisions to the Minimum Offer Price Rule (MOPR).
EPSA’s President and CEO Todd Snitchler shared the following statement on EPSA’s concerns with how PJM’s proposal will impact power generators’ ability to advance a sustainable energy transition by bringing reliable, affordable and cleaner electricity to the 65 million customers served by the nation’s largest grid operator.
“Competitive regional electricity markets have been and can continue to be a powerful force to bring reliable, affordable and cleaner energy solutions to Americans. But continued factors – such as out-of-market subsidies – undermine market efficiency and cripple our nation’s shared goals by raising energy costs and stifling competition and innovation.
A holistic approach to develop a durable market solution that achieves the best outcomes for consumers, the grid and the environment is warranted. But as EPSA has previously stated, the PJM MOPR reform proposal is not necessary at this moment, as demonstrated by the May capacity auction results, and more time should be taken by PJM and stakeholders to consider the matter.
The PJM proposal, rushed as it is, will fail to achieve the goals needed to ensure a reliable and affordable system while enabling a competitive clean energy transition. As EPSA discusses in its extensive protest and expert affidavit, PJM’s ‘focused’ MOPR proposal outlined in its July 30 filing infringes on states’ rights, and will not result in just and reasonable rates for PJM resources and consumers. It therefore should be rejected.”
EPSA member companies own and operate about 50,000 MW of power generation resources in the PJM region including natural gas, wind, solar and more. Competition among power suppliers in PJM markets has led to substantial consumer savings, ample capacity to provide reliable electricity, innovation and significant emissions reductions. PJM’s capacity market, the “Reliability Pricing Model,” secures generation resources three years in advance that can be called on when needed to meet demand and help ensure reliable electric service.
EPSA’s protest notes that the organization remains open to the development and implementation of just and reasonable refinements to, or a replacement for, the MOPR. But it cites concerns with the current proposal, highlighting the point that a weakened MOPR actually infringes on states’ rights by allowing some states to impose their policy choices on others and shift the cost of subsidized power generation to out-of-state producers and consumers.
The protest also cites: a lack of evidence submitted by PJM to support proposed changes; a rushed process to develop and implement the proposal; concern that it ignores the interests of suppliers that have invested billions of dollars into resources that keep the lights on within the PJM footprint which encompasses 13 mid-Atlantic states and DC; and the unreasonable shifting of the cost of subsidizing uneconomic resources onto other PJM sellers.
EPSA also filed as an attachment an affidavit from Bates White Economic Consultant Collin Cain, M. SC., which details why PJM’s proposal would undermine the competitive capacity market, enshrine discriminatory treatment and ultimately raise costs to customers. The affidavit notes that PJM’s capacity market is critical for protecting grid reliability, saying it is “not a peripheral or disposable feature of the PJM wholesale markets, but an integral component essential to ensuring economically efficient results” needed for reliable electric service.
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The Electric Power Supply Association (EPSA) is the national trade association representing America’s competitive power suppliers. EPSA members provide about 150,000 MW of reliable and competitively priced electricity from environmentally responsible facilities using a diverse mix of fuels and technologies including natural gas, wind, solar, hydropower, geothermal, storage, biomass, and coal. EPSA seeks to bring the benefits of competition to all power customers. Learn more at www.epsa.org and connect with us on LinkedIn and Twitter @EPSAnews.
