A PJM Energy Market analysis released concludes that the RTO’s markets are efficiently managing the entry and exit of capacity resources but warns their efforts could be hamstrung by policies to protect social, economic or political interests.“Policymakers must weigh these trade-offs, but understand that pursuing individual actions that ‘defeat’ efficient market outcomes will aggregate to a point they will altogether thwart effective operation of the market to the point it can no longer be relied upon to govern resource exit and entry and attract capital investment when needed,” it said.
The report was commissioned by the Board of Managers last summer, following efforts by money-losing coal-fired generators in Ohio and nuclear generators in Illinois to win state-backed subsidies.
The Public Utilities Commission of Ohio is grappling with how to respond to a recent FERC order requiring federal review of power purchase agreements it granted to American Electric Power and FirstEnergy.
Meanwhile, Exelon CEO Christopher Crane said in an earnings call on Friday that if Illinois legislators don’t step in and provide aid, it will decommission its money-losing Clinton and Quad Cities nuclear plants beginning next year.