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PSC Increases Capacity Proxy Price To Be Used In Upcoming Default Service RFP
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The District of Columbia PSC has directed that a higher capacity proxy price be used in Pepco's 2025-2026 RFP for electricity SOS supplies
The capacity proxy price is included in the SOS supply contracts for Residential
and Small Commercial service for periods in which a PJM BRA capacity price is not established. In the upcoming RFP, Pepco is seeking, for Residential
and Small Commercial SOS, 36-month contracts for a delivery period of June 1, 2026 through May 31, 2029, with such contracts blended with other full requirements contracts in the SOS portfolio
Pepco had proposed using the same method to set the capacity proxy price as used in last year's procurement, in which the
capacity proxy price, $299.89/MW-day, is based on the average of the two most recent PJM auction
results.
However, the D.C. PSC directed Pepco to set the proxy price, in both the Wholesale Full Requirements Service Agreement and
RFP, at $329.43/MW-day, which is the most recent PJM BRA result.
The PSC said, "Future BRA prices are expected to
remain elevated in the short term, consistent with recent auction results, and absent significant
changes to existing capacity market rules."
"By utilizing the most recent BRA result as the proxy price, we anticipate a better alignment with future BRA prices, thereby minimizing potential true-up
costs between the proxy price and actual BRA results and mitigating exposure to market
volatility," the PSC said
The PSC also directed additions to the RFP materials to inform bidders of the PSC's recent decision approving a long-term PPA to serve 5% of SOS load
In light of the PPA being approved, the PSC said, "we take this opportunity to provide bidders with additional clarity by directing Pepco to add the
following language to the RFP at the end of Section 2.1, 'Supply Requirement Overview,': 'On
August 14, 2025, the Commission issued Order No. 22702 approving Pepco’s proposed SOS
renewable energy power purchase agreement ('PPA') for 5 percent of SOS energy. Delivery of
energy from the approved PPA project is expected to begin in December 2027. SOS auctions
beginning in December 2026 for Delivery Years 2027-2028 and beyond will be adjusted
accordingly. There will be no impact on the upcoming auctions scheduled for December 8, 2025,
and January 5, 2026.'"
FC 1017
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October 1, 2025
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Copyright 2025 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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