Another Utility Seeks To Modify Default Service Procurement Products Due To PJM Capacity Market Uncertainty

Dayton Power & Light sought approval from the Public Utilities Commission of Ohio to replace a 36-month contract it would otherwise procure in an upcoming March 2020 Standard Service Offer auction with a 24-month product due to the lack of a base residual auction capacity price in PJM beyond May 31, 2022.

"Consistent with years past, DP&L’s CBP auction typically includes 12, 24, and 36-month products. These recent events between the FERC and PJM, however, have caused complications for EDUs when conducting their SSO competitive bid auctions. Specifically, the 36-month product extends through May 31, 2023, and as of now, there is still no certainty on the applicable capacity rate for the 2022/2023 delivery year. Therefore, including a 36-month product in DP&L’s competitive bid will inevitably increase the amount of inherited risk for all parties involved and may cause prices to be unusually high for the final 12 months. In the interest of maintaining beneficial and stable rates for its customers, DP&L proposes to eliminate the 36-month product and only offer the 12 and 24-month products in its upcoming March 2020 auction in order to alleviate the uncertainty brought about by the December FERC order," DP&L said

DP&L noted that PUCO granted similar relief to Duke Energy Ohio in a fall 2019 procurement

"Based on the uncertainty of the PJM applicable rate for the 2022-23 delivery year and previous findings by the Commission, DP&L respectfully requests that the Commission approve its request to offer a 24-month product, temporarily eliminating the 36-month product in the interest of consistency with other Ohio EDUs and to the benefit of customers," DP&L said

Case No. 17-957-EL-UNC