FERC Suspends PJM's Sought Tariff Revisions to Change Demand Response Rules for Capacity Market Participation; Sets Technical Conference

FERC accepted but suspended for a five-month period, subject to refund, and to the outcome of a technical conference and a further order, tariff revisions altering how demand response is qualified to participate in PJM's forward capacity auctions.

As previously reported, PJM's proposal specifically requires sellers intending to offer a demand resource into an RPM auction (whether with an offer price or as self-supply) to submit a "Demand Resource Sell Offer Plan" demonstrating "to PJM's satisfaction" that the resource will have the capability to provide a reduction in demand, or otherwise control load, by the start of the Delivery Year for which the resource will be committed. Notably, the Demand Resource Sell Offer Plan may be required to list specific end-users on which the resource intends to rely

"We find that PJM’s proposed tariff changes have not been shown to be just and reasonable and may be unjust, unreasonable, unduly discriminatory or preferential or otherwise unlawful," FERC said.

"Commenters raise a number of issues with PJM’s proposal that we find warrant further discussion, including but not limited to whether the proposed requirements for demand resources are reasonable, given the resource development cycle used by curtailment service providers to provide demand response inside PJM and given the overall reliability objectives of the RPM. We will, within the next sixty days, establish a technical conference to explore these issues. Accordingly, we accept and suspend PJM’s filing for a five month period to become effective the earlier of a Commission order or March 2, 2014, subject to refund, and the outcome of a technical conference. The details of such conference will follow in a subsequent notice," FERC said.