Exelon and Invenergy Transmission this week filed separate complaints at the Federal Energy Regulatory Commission seeking changes to the capacity markets run by the PJM Interconnection and the Midcontinent Independent System Operator.
Exelon asked FERC to order PJM to shift to a “prompt” auction from its current forward capacity auction schedule, according to a Tuesday filing at the agency. Currently, PJM holds annual base capacity auctions to secure power supplies three years in advance.
Under Exelon's proposal, PJM would hold its capacity auctions two months before the delivery year begins, starting with the 2030/31 delivery year. If FERC approves the proposal, PJM would hold its next capacity auction in December for the 2029/30 delivery year as planned, and then it would hold its next auction in early 2030.
Pushing out the date of the 2030/31 auction would give PJM time to overhaul its capacity market, which Exelon contends is no longer working properly, according to the complaint.
Adopting a prompt auction would help ensure that auctions are based on more accurate load forecasts, resource availability data and capacity accreditation levels, Exelon said. It would also facilitate more efficient resource entry and exit through improved market signals, the Chicago-based utility company said. Exelon’s utilities have about 10.7 million customers in PJM’s Mid-Atlantic and Midwest footprint.
Exelon asked FERC to make a decision on the complaint by Jan. 31, the last day before PJM is set to release the planning parameters for the 2030/31 delivery year base auction, which is set to be held in May.
PJM is reviewing the complaint and will reply at “the appropriate time,” Jeffrey Shields, a PJM spokesman, said.
The grid operator is accepting proposals from stakeholders on how it could reform its capacity market through its Power Reliability Through Market Design initiative, Shields noted. PJM has received more than 30 responses to its request for papers on the issue. They will be discussed at a Nov. 13 workshop.
When it kicked off the effort in May, PJM proposed three broad reform pathways: stabilizing its existing capacity market, rationing grid reliability among customer classes or regions and shifting to a market focused on energy and ancillary services and away from the capacity market.
Invenergy seeks MISO capacity payments
Meanwhile, Invenergy Transmission on Wednesday told FERC that MISO improperly bars high-voltage, direct-current merchant transmission lines from its capacity market.
MISO counts the capacity value of HVDC lines when it decides how much capacity it needs to buy in its capacity auctions, a move that reduces the amount of capacity it acquires, according to the complaint.
But, MISO’s rules prevent those lines from being accredited as capacity resources or their owners otherwise being paid for their capacity value, allowing the grid operator to benefit from the lines for free, Invenergy said.
“MISO cannot rely on that capacity, to the benefit of other customers, while refusing to provide any avenue for the entity that provides that capacity to receive commensurate compensation,” the Chicago-based company said.
Instead of recovering their costs through FERC-approved cost-of-service rates, the owners of merchant lines recover their costs via rates negotiated with their customers, Invenergy noted.
“Interregional merchant HVDC transmission lines only receive compensation if there is a product or service — such as capacity — for which they can transact with potential customers,” Invenergy said.
Without capacity payments from MISO, “there is no product or service that can be the basis of a merchant-based transaction in MISO,” Invenergy said.
Using a “direct loss of load” accreditation methodology, Invenergy’s Grain Belt Express HVDC transmission line could provide more than 1,800 MW of accredited capacity, according to the complaint.
The 5-GW, 600-kV Grain Belt project is slated to run about 800 miles from Kansas to Indiana. Invenergy plans to build the roughly $11 billion project in two phases, with the first phase running from southwest Kansas to central Missouri.
