Statement from EPSA and the PJM Power Providers Group
For Immediate Release: December 17, 2025
Media Contacts:
- Electric Power Supply Association: Christina Nyquist | cnyquist@epsa.org
- PJM Power Providers Group: Steve Kratz | Kratz@thebravogroup.com
December 17, 2025 – The PJM Power Providers Group and the Electric Power Supply Association today released the following statement on PJM Interconnection’s Base Residual Auction (BRA) results for the 2027/2028 Delivery Year.
“PJM’s capacity auction provides an early signal of future power needs as demand rises. The results continue to reflect the challenge at hand: a power system adjusting to rapidly rising demand after years of relative flat growth, particularly from data centers and AI load, alongside electrification and broader economic expansion.
Competitive generators are responding to recent price signals with new supply, and the market has multiple safeguards in place to meet reliability needs and adjust as system conditions evolve. Today’s results don’t fully reflect the wave of recent investment announcements because projects take years to deliver and the auction calendar has been compressed over multiple auction cycles.
The reality is that while customers enjoyed record low supply prices over the past decade, we are in a new era and there will be a cost to building the projected necessary resources on the timeline required. We remain focused on meaningful and cost-effective solutions to meet the moment: removing non-market barriers to development, such as permitting and siting roadblocks, to help bring needed resources online, addressing supply chain constraints, and providing regulatory certainty for investors.
Arguments in support of dramatic policy reversals, such as permitting utilities to rate base generation would do nothing to speed construction and would further exacerbate concerns about affordability.
In the face of unprecedented demand growth and the potential for overbuilding, competitive electricity markets like PJM remain the strongest and most proven tool to deliver reliable power, discipline costs, and protect customers from financial risk over the long term.”
Background:
PJM Interconnection’s latest capacity auction comes as electricity demand continues to rise, driven by data centers and AI development, electrification, and broader economic growth—sharpening the focus on how to build needed energy infrastructure while protecting consumers from rising costs.
PJM’s capacity market is designed to operate on a predictable, forward-looking timeline. In recent years, auction delays and changes have pushed multiple auctions closer together, effectively compressing several planning cycles into a shorter period. As a result, developers have had less time between auctions to advance projects through permitting, financing, and construction before competing in the market.
The Base Residual Auction reflects current market conditions but is not the final determination of resource adequacy for the 2027/2028 Delivery Year. PJM’s market design includes safeguards to address evolving system needs, including Incremental Auctions that allow additional resources to participate closer to the delivery year. At the same time, new generation capacity is moving through the development pipeline, and improved load forecasting is moderating some of the highest earlier demand projections.
Competitive generators continue to respond to market signals. The auction cleared 134,479 MW of unforced capacity generation (UCAP) and demand response. This includes 774 MW UCAP cleared of new resources and uprates. This follows, 2,669 MW of new generation added and the reversal of plans to retire 1,100 MW in the most recent auction held in July 2025—the first increase in new generation in four auction cycles.
Following the July 2024 capacity auction results—which cleared near the Cost of New Entry (CONE) for the first time in two decades—the generation market has seen a surge in momentum with substantial capital investment rapidly mobilizing. Over 12,000 MW of new generation is expected to enter the PJM regional grid, evidencing a definitive and robust market response.
See Factsheet: New or Restarted Generation Facilities in PJM
PJM and several states are also reviewing regulated utility load forecasting methodologies to ensure future auctions reflect accurate projections. Demand growth is real, but early forecasts overstated near-term risk, and future auctions can adjust accordingly.
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About EPSA:
The Electric Power Supply Association (EPSA) is the national trade association representing America’s competitive power suppliers. EPSA members provide more than 200,000 MW of reliable and competitively priced electricity throughout the U.S. using a diverse mix of fuels and technologies including natural gas, nuclear, wind, solar, hydropower, geothermal, storage, biomass, and coal.
About P3:
P3 is a non-profit organization that supports the development of properly designed and well-functioning power generation markets in the PJM region. All of New Jersey is located within the PJM footprint. P3 members own over 88,000 megawatts of generation assets and produce enough power to supply over 63 million homes in the PJM region. Our members have invested tens of billions of dollars into facilities in the PJM marketplace without any regulatory guarantee of a return on that investment. P3 members own and operate virtually all forms of electricity generation (gas, wind, solar, nuclear, coal, hydrogen, battery storage), and provide demand response and battery storage services in certain markets.
