Import Cap Likely to Settle About 9,000 MW

Oct 22, 2013

PJM is considering five capacity import zones with a combined limit (e.g. import cap) of 8,400 to 11,000 MW, officials told the Planning Committee Friday.

PJM is considering five capacity import zones with a combined limit of 8,400 to 11,000 MW, officials told the Planning Committee Friday.

PJM’s initial review indicated the RTO could import 11,000 to 12,000 MW simultaneously. Last week, however, PJM’s Mark Sims told members that the limit will be “slightly lower” than 11,000 and closer to the 8,347 MWs imported on July 16, 2013, the highest import observed in an analysis of three years of historical data.

“It should be around [8,347 MW] or a little higher,” Sims said.

PJM officials said the MISO North zone should have been drawn to include the thumb of Michigan and NIPSCO on the PJM-MISO seam (Source: PJM Interconnection, LLC)

Officials said they are considering modeling five “conceptual import zones”: MISO; MISO North; TVA/Louisville Gas & Electric; VACAR and NYISO.

In response to members’ questions, officials also said they may add a sixth zone to reflect the integration of Entergy’s transmission system into MISO. Entergy is “two hops away” from PJM, said Sims. “I don’t think it will have that much of an impact on the final limit.”

Stu Bresler, PJM vice president of market operations, said PJM is unlikely to accept suggestions that imports have firm transmission before offering into the capacity auction. Bresler said officials fear that the Federal Energy Regulatory Commission would reject such a requirement, which would be analogous to requiring internal resources to have signed interconnection service agreements three years before the delivery year. That, Bresler said “would be a barrier to entry.”

The Planning Committee approved a problem statement on a proposed cap in response to the May Base Residual Auction, in which more than 7,400 MW of imports cleared.

PJM wants to include the new limit in February when it posts the planning parameters for the 2014 base auction.

To meet that schedule, officials plan to present proposed methodology and manual language at the Planning Committee meeting Nov. 7. The MRC will hear first reading on Nov. 14, with a vote scheduled for Nov. 21.

If imports hit the limit, officials said they will clear at lower prices than internal resources, just as resources east of PJM’s west-to-east constraints are often priced higher.

Capacity Market PJM Planning Committee (PC)Reliability