The Federal Energy Regulatory Commission approved PJM’s request to retain 2,000 MW of capacity in yesterday’s third Incremental Auction for 2015/16 but rejected its request to purchase capacity outside of the Reliability Pricing Model, calling it “unreasonably vague and ill-defined” (ER15-738).

PJM had requested the one-time waiver on rules that would otherwise require it to release 2,000 MW of capacity, saying it feared that it might run short due to retirements of coal-fired generation.

In approving the request, FERC rejected arguments by interveners who said the RTO’s concerns were speculative. (See PJM Responds to Critics on Capacity Release Filings.)

“The release of approximately 2,000 MW of committed capacity could yield a reserve margin below the established installed capacity needed to assure reliable service to loads,” the commission said. “Moreover, given PJM’s reliance on committed capacity resources, the poor performance of generating capacity resources last year and the expected high level of generation retirements, absent granting the waiver, PJM would face increased risks of being unable to serve load.”

The commission, however, rebuffed PJM’s request for permission to obtain additional capacity outside of its auctions.

“Capacity procured under the proposed Tariff provision would be in addition to the 2,000 MW procured at competitive prices under the waiver, and PJM has not provided just and reasonable Tariff provisions that specify the criteria for determining how much additional capacity it requires, nor how to determine whether those contracts are at just and reasonable prices,” the commission ruled.

It said PJM could refile its request with more specifics to address the shortcomings in the initial filing.