PJM’s recommended Installed Reserve Margin (IRM) will increase slightly because of the increasing alignment of the RTO’s peak demand with demand outside of the region, according to a preliminary analysis presented to the Planning Committee Thursday.
The analysis recommends an IRM of 16.2% for delivery year 2014/15 (up from 15.9% in the 2012 analysis) and margins of 15.7% for delivery years 2015 through 2017.
The IRM is increasing despite a small reduction in the average Effective Equivalent Demand Forced Outage Rate (EEFORd).
PJM’s Tom Falin told members the reason for the increased IRM was an increase in the “World Peak” — the world’s share of its annual peak coincident with the PJM annual peak — to 96.4% from 95.4% last year. “We’re seeing a little less help coming in from the other regions,” Falin explained.
The study results will re-set IRM for the 2014/15 through 2016/17 delivery years and establish the initial IRM for 2017/18.
The IRM must be finalized by February 1 prior to its use in next year’s capacity auction.
