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FERC chairman warns PJM may need emergency measures this summer and flags governance concerns
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Summary
The FERC chairman said a PJM report warns the RTO might use emergency measures to meet summer load, citing a 3.6 GW drop in dispatchable capacity and 1.9 GW load increase. He also expressed concern after PJM members voted not to reelect two board members, including chairman Mark Takahashi.
The Chairman of the Federal Energy Regulatory Commission said a PJM report issued this week warns the regional transmission organization may have to use emergency measures to meet electricity demand as soon as this summer.
At a FERC press conference, the Chairman said the numbers in PJM’s report were "a little bit shocking," noting that "their operational capacity is down 3.6 gigs and then loads up 1.9 gigs," and that "the arithmetic doesn't add up" when dispatchable generation retires without equivalent replacement. He warned such a trend could push PJM into emergency operations that would rely on demand response and other measures.
Why it matters: FERC oversees wholesale electricity markets and reliability policy, and PJM serves more than 65 million customers across parts of 13 states and the District of Columbia. A formal shift to routine emergency measures would mark a significant reliability strain and could affect customers and market operations across the region.
The Chairman described demand response as behavioral and episodic, not a permanent substitute for generation, saying roughly "three quarters" of expected demand response did not show up during past extreme weather events. He cautioned that relying on demand response as a regular planning assumption risks leaving the grid vulnerable.
Governance question: the Chairman said he attended a recent PJM board meeting in Leesburg and learned that members voted not to reelect two board members, "including Mark Takahashi, the chairman." He called the vote a source of concern given the governance challenges facing PJM and said he has previously filed statements expressing governance worries.
Capacity market critique: the Chairman criticized capacity market design in the PJM zone as an "administrative construct" intended to pay generators their "missing money" and said the market "has got major problems," previewing deeper discussion at a June technical conference where the first day will focus on PJM.
What happens next: the Chairman said FERC will discuss capacity market issues at the upcoming technical conference in June. He did not announce any formal FERC action at the press conference.
