PJM BRA 2023/24 Rule Changes and Auction Parameters: Capacity Price Forecast | Capacity Watch Blog
Published November 23, 2021 | capacity-watch
For Investors, Developers and Generation Owners making investment decisions in the PJM RTO it’s imperative to be up to date on the market fundamentals, latest regulatory updates, and other rule changes that may impact pricing moving forward.
In ESAI’s latest Capacity Watch report, we analyze the three major rule changes that will impact pricing in the upcoming PJM Base Residual Auction (2023/24 BRA) and the subsequent influence on clearing prices out to 2030. Here are a few highlights from the report:
- ELCC – FERC’s approval of PJM’s revised proposal to implement capacity accreditation using an effective load carrying capability (ELCC) approach. The ELCC rules will result in changes, both higher and lower, in the qualified capacity of some intermittent resources in PJM. For example,
- ELCC rules are expected to facilitate additional participation by battery storage assets, that previously had an 8-hour requirement.
- Longer-term, the ELCC approach is expected to limit the growth in qualified capacity from some renewable technologies, particularly grid-level solar.
- MSOC – FERC approved a default Market Seller Offer Cap (MSOC) based on the Net Avoidable Cost Rates (Net ACR) for resources, which is more restrictive than both the MSOC that was in place for the 2022/23 BRA and the replacement approach proposed by PJM.
- MOPR – A deadlocked FERC failed to reach a majority decision about PJM’s proposed revisions to the Minimum Offer Price Rule (MOPR), resulting in the proposed changes taking effect by law. Under the new MOPR, offer floors will be imposed only for resources from suppliers deemed to have the ability and incentive to exercise buyer market power. Mitigation will not be triggered by subsidies used to advance state policy objectives or by new merchant entry. Although the rule change is expected to apply for the 2023/24 BRA in January 2022, the filing was met with significant pushback from stakeholders and rehearing requests pending.
The Capacity report also discusses how the 2023/24 BRA clearing prices will be affected by the updated PJM auction parameters, including:
- Net CONE values for the RTO and each LDA.
- Updated RTO-wide Reliability Requirement and VRR Demand Curve.
- CETL values for each LDA, including changes to MAAC, COMED, and ATSI.
ESAI’s updated forecast, reflecting the PJM BRA parameters and rule changes, is discussed in the latest issue of Capacity Watch published recently to our subscriber base. For more information about our Capacity Forecasts, see our Capacity Market Coverage.
Request Your Free Energy Research Reports
Please fill in your contact details, check the box(es) on the right to indicate your preferred complimentary research report, up to a maximum of 3 reports and if you have any comments.
*Project Evaluation Program (PEP) database with detailed evaluation of generator projects under development and at-risk of retirement not included in free trial for Capacity Watch. ESAI Power grants free trials at its sole discretion. Note: the PEP product can be viewed on a demo basis over zoom or teams. Corporate policy is not to grant access to our most recent reports during a free trial.
ESAI Power LLC
401 Edgewater Place, Suite 640
Wakefield, MA 01880
ESAI Power is a market research and consulting firm that delivers focused analysis of the wholesale power markets in the Northeast region of the US: PJM, NYISO, and ISO-NE. Since 2001, ESAI has been providing market-focused research product content and custom consulting services for Northeast power market participants including investors (banks, private equity, & hedge funds) & developers, generation owners & operators, utilities & retail electricity suppliers, regulators & RTOs, traders, and end-users & buyers.
Who We Serve
- All Content Offers
- Clean Energy Service Brochure
- Forecast Methodology Brochure
- Free Trial Report Request Form
- Investors & Developers Brochure
- Long-Term Forecasts Brochure
- Near Term Service Brochure
- Owners & Operators Brochure
- Power Purchasing Agreements WP
- Quarterly Power Service Brochure
- Subscribe To Our Newsletter
- Utilities & Electric Suppliers Brochure
- WholeView Service Brochure
- FERC Approved PJM Queue Reform Proposal | Renewables Watch Blog February 2, 2023
- EPA Proposes Tightening Fine Particulate Matter Standard, Potentially Affecting Coal Power Plants | Emissions News January 6, 2023
- RGGI Auction 58 Clears at $12.99 | Emissions Watch Blog December 9, 2022
- MISO Capacity Price Forecast PRA 2023/24 | Capacity Watch Blog November 2, 2022
- Persistent Congestion on NYISO’s Central East Interface: The End is in Sight | Congestion Watch Blog October 18, 2022
- PJM BRA 2024/25 Capacity Price Forecast | Capacity Watch Blog October 18, 2022
- Renewable Energy PPA Trends & Outlook | Renewables Watch Blog October 5, 2022
- RGGI Auction 57 Clears At $13.45, A 3% Drop | Emissions Watch Blog September 9, 2022
- Renewable Energy Development Challenges | Renewables Watch Blog July 19, 2022
- Supreme Court’s EPA Decision to Impact Coal Plant Retirements | Emissions News July 12, 2022
- Proposed EPA Rule Leads to Quadrupling Group 3 Ozone Season CSAPR NOx Prices | Emissions Watch Blog June 7, 2022
- RGGI Auction 56 Update: RGGI Auction Clears At $13.90 | Emissions Watch Blog June 3, 2022
- NYISO Central East Congestion to Moderate this summer | Congestion Watch Blog May 20, 2022
- ESAI Power Sponsors ACORE Renewable Energy Finance Forum | Renewables News May 17, 2022
- PJM BRA 2023/24 Capacity Price Forecast | Capacity Watch Blog May 13, 2022