• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Electric Power Supply Association

  • Podcast
  • About EPSA
    • Our Policy Principles
    • EPSA Members
    • Our Staff
    • Careers
  • Contact
  • FAQ
EPSA

EPSA

  • Filings
    • Federal Energy Regulatory Commission
    • Federal
    • Judiciary
    • State
    • ISOs/RTOs
  • Newsroom
    • Press Releases
    • Media Contacts
    • Power Moves Newsletter
    • Factsheets and White Papers
    • Opinion and Commentary
    • Social Media
    • Podcast
  • Competitive Solutions
    • Reliable Power
    • Cost Savings
    • Environmental Progress
      • Competitive Emissions Policy Primers
    • Energy Innovation
    • In Your State
  • For Members
    • EPSA Membership
    • Committees
  • PowerFacts Blog
Home / Filings / EPSA Submits Capacity Market Workshop Comments to PJM With Guiding Principles on Capacity Markets

March 16, 2021

EPSA Submits Capacity Market Workshop Comments to PJM With Guiding Principles on Capacity Markets

By EPSA

COMMENTS OF THE ELECTRIC POWER SUPPLY ASSOCIATION

PJM Capacity Market Workshop – Session 2

The Electric Power Supply Association (“EPSA”) appreciates the opportunity to provide comments following the PJM Interconnection, LLC (“PJM”) Capacity Market Workshop – Session 2, which was held on March 4, 2021. PJM initiated the series of workshop sessions to discuss and explore with stakeholders potential enhancements to the PJM capacity market and to determine whether or not a formal stakeholder process to consider capacity market reforms should be pursued.

At the conclusion of the Session 2 workshop, PJM staff outlined that stakeholders could provide feedback on the same issues addressed by speakers during the session, which focused on the following:

  1. What problem are we trying to solve through this effort?
  2. Do you agree with PJM that we should be attempting to advance this discussion at this time?
  3. What are the principles that possible enhancement should be built upon? and,
  4. Do you have particular issues or a proposed prioritization that you would like to propose?

EPSA and its member companies have been actively engaged at every phase of the development and refinement of the PJM capacity market since its inception. We do agree with PJM that the discussion should be advanced at this time. Accordingly, to assist PJM and stakeholders with consideration of the issues, EPSA has developed several guiding principles on capacity markets that possible enhancement should be built on.

EPSA Guiding Principles for Capacity Markets
March 2021

  1. In lieu of state-level integrated resource planning or an energy-only market, regional
    capacity markets utilize pre-determined reliability targets to procure the lowest cost
    set of resources to meet regional resource adequacy needs. A forward capacity
    market, which provides needed revenue to resources that may seldom run but are
    needed during extreme conditions, has been a highly successful regional resource
    adequacy tool to maintain grid reliability and is an efficient, cost effective, and
    durable mechanism for integrating the evolving resource mix.
  2. To address state policy goals, capacity markets should integrate state-preferred
    resources that are not procured via a competitive, market-based procurement
    process only when the RTO is confident that both reliability and market integrity will
    be adequately maintained. The capacity market must still ensure buyer-side and
    seller-side market power is appropriately mitigated.
  3. Capacity markets should not be a barrier to renewable integration; all resources
    should have the ability to compete based on their contribution to the reliability target
    regardless of how it is measured (e.g., traditional UCAP or ELCC)
  4. All market participants must have the opportunity to recover their investment to
    maintain confidence in the market and incentivize continued new development and
    retirement through market price signals.
  5. Competitive wholesale markets are the most effective tool to achieve policy
    objectives by encouraging private capital deployment and innovation at the lowest
    cost while appropriately shifting investment risk to resource developers and
    operators, not consumers.
  6. Wholesale energy markets that incorporate both environmental and reliability
    requirements will yield the lowest cost set of resources and technologies that jointly
    produce the greatest emission abatement while maintaining the highest level of
    reliability.

Primary Sidebar

Download PDF

Share

Home Page Help Area

Sign up for EPSA’s Power Moves newsletter – a monthly update on the road to a cleaner, affordable and reliable energy future that works for all Americans.

LEARN MORE

Footer

1401 New York Ave. NW
Suite 950
Washington, DC 20005

p 202.628.8200
f 202.628.8260

  • Facebook
  • LinkedIn
  • Twitter
  • Home
  • About EPSA
  • Filings
  • Newsroom
  • For Members
  • Contact
  • PowerFacts Blog
  • FAQ

Copyright © 2023 | Electric Power Supply Association. All rights reserved. | Privacy Policy >