PJM Renewable Capacity Pricing | Renewables Watch Blog

Published September 9, 2021 | Renewables-Watch

Renewable generation in PJM has been increasing over the past few years and will play a larger role in the market’s resource mix going forward. Coal-fired capacity is retiring at a rapid pace, and the interconnection queue is heavily comprised of renewable capacity. There is approximately 133 GW of utility-scale solar, wind, and offshore wind projects with queue positions in various stages of development.

In the short-term, ESAI Power expects Class I REC prices to increase as state Renewable Portfolio Standard (RPS) requirements ramp-up, resulting in REC demand outpacing supply. However, as more renewable capacity, including substantial offshore wind capacity, enters the market, REC prices are expected to fall off significantly after 2026.

Over the past few years, several PJM states made significant revisions to their RPS. Maryland, New Jersey, Virginia, and Delaware increased their annual RPS requirements. These revisions have a bullish impact on future REC prices. Check out the full Renewables Watch report for an in-depth briefing on each state’s policies.

ESAI Power’s Class I REC forecast and projected supply / demand balance incorporate all pertinent legislative changes, the PJM load forecast, all existing capacity and expectations for future renewable supply additions. Subscribers can check out the recent Renewables Watch for in-depth price forecasts and analysis.

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ESAI Power evaluates the renewable energy issues, markets and trends in the PJM, New York, and New England market footprints. Coverage includes solar, onshore and offshore wind, hydroelectric, and storage. For each region, ESAI Power details the regulatory and market factors that impact the supply and demand balance for Class I Renewable Energy Credits (RECs) and projects the supply and demand balance of Class I RECs through 2030.

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Renewable Energy Northeast Trends White Paper Graphic

Offshore wind is driving renewable energy growth in the PJM, NYISO & ISO-NE. ESAI has examined the interconnection queue data in each of the three Northeast power pools to identify trends in the generation capacity development by fuel type. Highlights of this white paper include:

  • Conventional generation development has dwindled.
  • Renewable energy aims for state-mandated targets.
  • Solar is surging across the area.
  • Onshore wind is declining significantly.
  • Offshore wind takes center stage, especially in NY & NE.

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Renewables Watch Executive Summary Volume 1

ESAI Power recently completed its inaugural issue of ESAI’s Renewables WatchTM.  This is the first of a quarterly series covering ongoing developments in clean energy and renewable power. Renewables WatchTM brings the same detailed coverage the ESAI Power team has provided for the energy, capacity, and emissions allowance markets to the renewable energy sector. Subscribers to Renewables WatchTM receive quarterly updates about the supply and demand balance for renewable energy and ESAI Power’s forecast for renewable energy credit (REC) prices in PJM, ISO-NE & NYISO.