July Heat Wave Update

PJM’s Kevin Hatch presented an update on how two heat waves between July 14-17 and 23-30 affected PJM operations, which involved multiple demand response deployments and emergency alerts and advisories. 

Loads reached their apex on the afternoon of July 29, with a preliminary integrated hourly peak of 157,487 MW, which Hatch said would be the ninth highest the RTO has seen. He said the day saw atypically high load ramping, renewable performance below the seasonal effective load-carrying capability (ELCC) value, and generation outages exceeding the three-year average. Around 3.7 GW of DR was deployed. 

The declaration of maximum generation and load management alerts without extreme temperatures raised concerns for PJM that load growth and renewable penetration could jeopardize resource adequacy. During the Aug. 5 Planning Committee meeting, PJM said it had initiated 11 maximum generation and load management alerts in 2025, more than the prior decade combined. 

The first heat wave saw maximum generation and load management alerts July 15 and 16, which Hatch said included notifications to neighboring balancing authorities that off-system sales could be curtailed. 

A generation maintenance outage recall was issued ahead of the second heat wave, followed by hot weather alerts starting in PJM West on July 22 and for the whole RTO the following day. Maximum generation and load management alerts were issued for July 24, 25, 28, 29 and 30. Pre-emergency load management was called July 28 for the BGE, PEPCO and Dominion zones, expanded to the full RTO the next day, when all available long- and short-lead DR was called. 

Synchronized Reserve Performance Inquiry

The Independent Market Monitor presented the results of a poll of resource owners who saw their units underperform during the July 1 synchronized reserve performance inquiry, which saw 79.5% response for individual resources. The event lasted 10 minutes and 38 seconds, with 2,398 MW of generation and 544 MW of DR assigned.  

Joel Romero Luna, of Monitoring Analytics, said the owners of 33 underperforming resources were contacted and responses covered 20 units. The single-largest identifiable cause of those units’ shortfall was inaccurate parameters having been submitted, accounting for around 50 MW of the 581-MW shortfall. Around 225 MW of shortfall was categorized into an “other” category due to the number of resource owners falling below the confidentiality requirement of at least four generation owners providing the same information, allowing anonymized aggregation. 

He said outreach to generation owners is continuing with the goal of increasing the response rate. 

July Operating Metrics

PJM saw an average hourly forecast error of 1.7% for July and an average peak error of 1.78%, according to the RTO’s monthly operating metrics. The 3% daily peak error benchmark was exceeded three days, with over-forecasting on July 19, 24 and 26 attributed to storms causing load to come in lower than expected. 

The month saw four spin events, two shared reserve events, seven maximum generation and load management alerts, five pre-emergency load management reduction actions, seven shortage cases, 10 hot weather alerts and 39 post-contingency local load relief warnings. All the shortage cases occurred July 28, with one primarily due to generation loss and six due to solar generation falling faster than load was expected to decline between 6:59 p.m. and 7:25 p.m. 

Two of the spin events exceeded 10 minutes, allowing the RTO to begin measuring a rolling average to track synchronized reserve performance for the purpose of potentially backing down a 30% adder to the reserve requirement. PJM established the adder in May 2023 to address poor reserve performance, which PJM aimed to address through changes to reserve deployment implemented in December 2024.  

In March 2025, PJM began measuring reserve performance, backdated to December 2024, and created a paradigm under which the adder could be reduced if reserve performance is above 75% across a rolling average of three events exceeding 10 minutes.  

Under that model, the adder would be reduced by 10% if performance across the rolling average is between 75 and 85%. It would be reduced by 20% if the average is between 85 and 95%, and it would be eliminated at performance above 95%. The adder could be increased by 10% if performance falls below 75%, but the reserve requirement must remain within a 100-to-130% band. (See PJM OC Briefs: March 6, 2025.) 

The July 1 and 22 events, paired with a spin event Feb. 5, carry an average of 74.4% performance, meaning the adder remains untouched. For the next event to reduce the adder by 10%, performance would need to be 66.7% or greater; performance at 96.7% or greater would result in the adder being reduced by 20%. 

The July 22 event lasted 10 minutes and 32 seconds and saw 2,764 MW of generation and 548 MW of DR assigned, with performance at 79 and 80% respectively. A July 30 event last 5 minutes and 57 seconds, with 3,588 MW of generation and 328 MW of DR assigned, with performance at 59 and 72% respectively; the next day another spin event was declared lasting 6 minutes and 16 seconds, with 2,802 MW of generation and 582 MW of DR assigned, with 45 and 63% performance. 

Generation Deactivation Manual Revisions

The Operating Committee endorsed by acclamation revisions to Manual 14D: Generator Operational Requirements to rework the requirements for a resource requesting deactivation. The proposal will advance to the Markets and Reliability Committee for a first read at its Aug. 20 meeting, followed by endorsement on Sept. 25. (See “1st Read on Manual Revisions Detailing Generation Deactivation Process,” PJM OC Briefs: July 10, 2025.) 

Resource owners would be required to provide PJM with at least one year’s notice before going offline and follow the must-offer exemption process if they are seeking to not participate in the capacity market. The proposal also expands transparency requirements, mandating that resource owners entering into a reliability-must-run agreement with PJM provide the RTO and the Monitor with an estimate of the costs that would be recovered under the agreement, which would be publicly posted. Ongoing monthly updates would be required during the term of the RMR agreement. The Monitor also would publicize market power letters. 

The language would remove a $2 million cap on project investments allowable under the deactivation avoidable cost credit (DACC) compensation methodology, limit the adder for investments to 10% and remove language causing the credit to be determined through the daily deficiency rate rather than the deactivation avoidable cost rate (DACR) when the DACR and applicable multiplier exceed the deficiency rate.