HomeOctober 2, 2015
PJM Set To Seek FERC Approval For Increase in Energy Market Price Cap
Copyright 2015 EnergyChoiceMatters.com.
PJM is set to formally ask FERC to approve tariff changes that would increase the energy market offer cap, after the Members Committee approved a compromise proposal
Under the proposal sent to the PJM Board, whose approval is expected:
• Incremental energy cost-based offers are now capped at $2,000/MWh and allowed to set price
• Costs in excess of $2,000/MWh may be recovered through make-whole payments
• Market-based offers for individual units will be allowed to rise with their cost-based offers
There are no changes to the following:
• 10 percent adder
• Shortage penalty factors
• Startup, no-load compensation
The current offer cap for generators is $1,000/MWh, though demand response may offer at $1,800/MWh and LMP can exceed that cap under shortage conditions
PJM said that offers above $2,000/MWh would still be dispatched in merit order. PJM committed to providing a detailed analysis for any offers above $1,000/MWh.
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