ESAI PJM Capacity Auction Track Record Since 2016
November 21, 2023 | Blog Post | capacity-watch, capacity, base-residual-auctions, capacity-auctions, capacity-forecasts, PJM
Generation owners and their investors are placing big bets (often in the hundreds of millions of dollars) in the PJM Capacity Market. As Mark Christie, FERC Commissioner, put it in March 2023, “Capacity Markets are characterized by such hopeless complexity and impenetrable opacity that they represent the example of a game that only insiders can play and win.”
ESAI Power’s Capacity market experts were consultants during the formation of the PJM Capacity market 20 plus years ago. ESAI’s involvement in these early consulting projects on Capacity market rules and auction structure in PJM prompted ESAI to launch a quarterly report called Capacity Watch in 2003. Over the past two decades, we have helped inform our subscription clients with ongoing analysis of the Capacity markets. This consulting knowledge plus ongoing primary research on the PJM market positions ESAI analysts as the foremost Capacity Market experts.
We publish Capacity Watch and the Generation Asset Monitor to assess Capacity market rule changes, supply, demand, the interconnection queues and forecast upcoming fossil retirements. Whilst many see “hopeless complexity”, ESAI Power’s Capacity experts can see through the noise and into trends to provide reliable input into Generation Owner and Investor Capacity auction bidding strategies.
ESAI Power’s vision is to: ”advance transparency, competitiveness, efficiency, and transformation in the power markets,” and we support clients by providing insights and, as much as possible, transparency for our subscribers.
Capacity Watch customers receive pre-auction pricing forecasts for the capacity markets in PJM, ISO-NE, NYISO and MISO. We maintain long-term (10-year) capacity market projections incorporating detailed assessments of market drivers such as load projections, demand curve parameters, new capacity coming online, retirements (including forecasted plants at-risk of retirement), and transmission constraints that impact locational delivery and pricing.
ESAI is now offering the opportunity to request our Pre-Auction Capacity Price Forecasts for PJM’s Base Residual Auctions (BRA) over the past 7 Capacity Auctions. This white paper compares ESAI’s pre-auction BRA forecasts with actual BRA results across defined locational deliverability areas (LDA) for the past 7 PJM Base Residual Auctions.
