Markets and Reliability Committee

Voting on Site Control Requirement Manual Revisions Deferred Pending Settlement

VALLEY FORGE, Pa. — Stakeholders in the Markets and Reliability Committee (MRC) voted for a third consecutive meeting to delay acting on revisions to Manual 14H intended to clarify when developers may add or remove parcels from their project footprint. PJM and EDF Renewables stated they’re working toward resolving a complaint filed on the matter (EL25-22). (See “Other Committee Business,” PJM MRC/MC Briefs: Jan. 23, 2025.)

The complaint from the American Clean Power Association, Solar Energy Industries Association and Advanced Energy United alleges PJM is violating its tariff and Manual 14H in guidance it has issued to developers around when they can change the parcels included in their projects. In past stakeholder meetings, PJM said the proposed manual revisions would codify that guidance, which renewable developers have argued is overly burdensome and would require them to retain land they have determined is unneeded.

A motion to defer voting on the manual revisions initially was rejected by stakeholders, with the 60% in support falling shy of the two-thirds sector-weighted threshold. Emma Nix, of EDF Renewables, told the committee that settlement discussions are making progress and passing the proposal would frustrate that process. The second vote passed with 82% support.

“I expect that we will have a settlement that we can share with stakeholders within the next month … things are going very smoothly,” she said.

PJM attorney Chris Holt said the RTO is limited in what it can say due to settlement confidentiality. But he confirmed discussions are progressing toward a resolution. He noted that FERC has granted an abeyance on the complaint that ends on March 10 and stated that PJM is hopeful an agreement can be reached by then. General Counsel Chris O’Hara said settlements often result in PJM committing to propose revisions to its governing documents in the FERC docket in which the settlement is made. If such an agreement is reached, those changes might not come back to the stakeholder process for consideration next month. Interested parties instead could comment on that docket.

The proposed changes would allow parcels to be added to a project at Decision Point 1, so long as the land is adjacent to the site or evidence of connecting easements is provided. Parcels also could be removed at this point, so long as the project continues to meet the minimum acreage and energy output defined in the project application. (See “Vote on Site Control Requirements Deferred,” PJM MRC/MC Briefs: Dec. 18, 2024.)

The revisions would seek to clarify language stating there are no specific site control evidentiary requirements associated with Decision Point 2 by specifying that “site control must be maintained throughout the cycle process.” A note also would be added stating that parcels similarly can be added to DP1, with the caveat that a one-year term would be imposed from the end of Phase 2 of the relevant study cycle.

No additions would be permitted at the final Decision Point 3, but reductions would be allowed so long as the acreage-per-megawatt and evidentiary requirements continue to be met. Once a generator interconnection agreement is signed, any site control changes would require a necessary study agreement to determine permissibility.

3 Packages Advancing from ELCC Task Force

PJM presented a slate of proposals aimed at adding new generation categories to the effective load carrying capability (ELCC) framework and how analysis of changes in the resource mix and risk modeling affect class accreditation. They are the first recommendations made by the ELCC Senior Task Force (ELCCSTF), which was formed last year to consider changes in the functionality and transparency of the methodology.

Two of the proposals focus on how changes in ELCC inputs can affect resource class ratings between the completion of a Base Residual Auction (BRA) and the associated delivery year, as well as how that might interact with any capacity shortfalls that could be caused if a resource sees its accreditation reduced between a BRA and incremental auction (IA).

The main motion advancing to the MRC, Package B, would lock resources’ ELCC ratings and accreditation in at their values used in the BRA, though any changes in risk modeling still would affect the Reserve Requirement Study values used in the IAs and could cause PJM to revise the amount of capacity it procures in those auctions. The alternative, Package C, would follow the status quo of updating ratings between IAs, but would lower the penalty rate for any deficiency associated with reduced accreditation to 100% of its clearing price, down from the 120% penalty rate. The two proposals were nearly tied in an ELCCSTF poll, with Package B holding 66.5158% support and 68% preference over the status quo, while Package C received 66.5025% and 74.9% preference.

Package A was introduced by Vistra and would have capped the deficiency charge at the lesser of any change in accreditation or the equivalent demand forced outage rate (EFORd).

PJM’s Pat Bruno said Package B would remove the uncertainty associated with shifting accreditation from market sellers while retaining penalties for any shortfall in installed capacity (ICAP). He gave the example of a unit experiencing a catastrophic failure or a planned resource not entering commercial service on time still being subject to deficiency charges. Package C would retain some incentive for market sellers to mitigate any lost AUCAP.

Susan Bruce, representing the PJM Industrial Customer Coalition, argued that Package B would shift all risk to load and require load to buy shortfall capacity twice, in the BRA and IA.

“The main motion addresses a concern, and I certainly am sympathetic to the concern, but it shifts the risk to load … so I think some fundamental question should be answered here,” she said.

Adrien Ford, of Constellation, said the main motion would handle the unhedgeable risk of changing ELCC ratings more effectively than the other two options considered.

The third proposal advancing from the ELCCSTF would add two new resource classes: a waste-to-energy subset of the steam generation category and oil-fired combustion turbines (CTs). The former has an estimated ELCC rating of 83% based on the parameters used in the 2025/26 third IA, while oil CTs would have an 85% rating.

1st Read on CIFP Manual Revisions

PJM’s Joseph Tutino provided a first read on a set of manual revisions to conform with FERC’s order granting PJM’s capacity market changes drafted through the Critical Issue Fast Path (CIFP) process in 2023. The package is the second set of conforming revisions, this time focusing on generation testing requirements and adding a requirement that dual-fuel resources must offer schedules with both fuels into the energy market. (See “1st Read on 2nd Phase of CIFP Manual Revisions,” PJM MIC Briefs: Jan. 8, 2025.)

The summer and winter capability testing detailed in Manual 18 would be changed to focus on whether capacity resources are able to output their daily ICAP minus the 95th percentile hourly seasonal net output. A resource that has a daily ICAP value exceeding the tested capability during that season would be subject to shortfall charges until it is able to test to a greater capability. The addition of generation operational testing to Manuals 14, 18 and 28 would allow PJM to test a resource twice per season, plus any additional retests if a unit fails to perform. The dual-fuel must-offer requirement would be codified in Manual 11.

Ford said Constellation has worked with PJM on changes to the language to reflect permit requirements. PJM’s Skyler Marzewski said the RTO views those changes as a clarification rather than substantive change to the proposal.

Members Committee

Manual Revisions Seek to Reimagine Role of MC Webinar

PJM’s Michele Greening presented revisions to Manual 34 that would restructure the MC Webinar in an effort to shift substantive discussions to be held instead at the MC. The proposal includes a single change to revise the manual to state that “reports, briefing and non-decisional business will be conducted” to instead read as “may be conducted,” allowing for more flexibility.

Vistra’s Erik Heinle said the webinar is a useful venue and should continue. But some stakeholders have grown concerned that topics discussed there are more appropriately addressed before the broader attendance that the full committee sees. In particular, he said the monthly reports the Independent Market Monitor provides should be moved to the MC.

Tom Hyzinski, of the GT Power Group, provided an example from the March 18 MC Webinar to highlight the concern raised by Heinle. Hyzinski said that although it was not covered or even noticed in the Market Monitoring Report that was posted, the Monitor mentioned at the webinar that PJM had unilaterally increased the amount of reserves they carry some time ago. That increase needs to be addressed, he said, suggesting the additional reserves PJM procures are inappropriately increasing consumer costs. Hyzinski said PJM staff were not present to refute those claims or offer alternative perspectives. (See “Stakeholders Reject PJM Synch Reserve Manual Change; RTO Overrides,” PJM MRC/MC Briefs: May 31, 2023.)

Monitor Joe Bowring responded that the argument he voiced during the webinar was that there are communication issues between PJM dispatchers and generation owners that have led to reserves underperforming and that resolving that issue would obviate the need for the higher reserve requirement. Rather than moving the reports to the MC, Bowring suggested it may be more effective for webinar participants to request that discussion of materials presented be added to the MC agenda when warranted.

Stakeholders Discuss Synchronized Reserves

PJM’s Mike Bryson said PJM may lower its synchronized reserve requirement if a trend of increased performance holds up. The RTO increased the requirement by 30% in May 2023 to address low performance. That change may be reversed if five consecutive spin events see 100% or higher performance. In response to stakeholder questions as to whether PJM will continue to monitor reserve deployment and consider ongoing changes to the requirement, Bryson said the focus is getting back to the standard procurement target before considering next steps.

Bowring said he’s glad to hear PJM is considering the change and he’s hopeful changes to how reserves are deployed will improve performance to where the baseline requirement is sufficient for PJM. (See “Stakeholders Endorse Reserve Rework, Reject Procurement Flexibility,” PJM MRC Briefs: July 24, 2024.)

Both Bowring and Bryson said the dialogue they had with generation owners whose units underperformed yielded helpful insight into what was driving the issue, and ongoing coordination would be beneficial.