Capacity prices cleared PJM Interconnection LLC’s (PJM) most recent auction for the “rest of RTO” region at $140.00 per megawatt-day (MW-day) for the PJM delivery year June 1, 2021 through May 31, 2022.  The rest of RTO region represents all of the unconstrained zones of PJM and makes up the majority of the PJM footprint.  The clearing price of this auction is roughly double the result for the rest of RTO region for the prior delivery year which cleared at $76.53/MW-day.

Five local delivery areas were constrained and cleared at prices higher than the rest of RTO region:  ATSI $171.33/MW-day, BGE $200.30/MW-day, COMED $195.55/MW-day, EMAAC $165.73/MW-day, PSEG $204.29/MW-day.

The auction cleared a total of 163,627 MWs, representing a 21.5% reserve margin over PJM’s projected peak demand for the 2021/22 delivery year.  The prior auction cleared 165,109 MWs, representing a 23.3% reserve margin.

Notably, the amount of nuclear capacity that cleared in the auction was 7,473 MWs less than the prior auction.  FirstEnergy Solutions (FES) announced that it failed to clear 3,865 MW of nuclear capacity: Davis-Besse (875 MW), Perry (1,212 MW), and Beaver Valley Units 1 & 2 (1,778 MW).  Exelon announced that it failed to clear roughly 3,500 MW of nuclear capacity in the Dresden, Three Mile Island, and Byron plants, with Three Mile failing to clear for the second consecutive auction.  Exelon also announced that it cleared its Quad Cities nuclear plant in Illinois in the auction, a plant that had failed to clear in the prior auction.

There was also a significant increase from the prior auction in non-traditional capacity resources.  Demand response increased 42% (7,820 MW to 11,126 MW), energy efficiency increased 66% (1,710 MW to 2,832 MW), wind increased 60% (888 MW to 1,417 MW), solar increased 456% (125 MW to 570 MW), and seasonal capacity increased 80% (397 MW to 715 MW).

PJM will conduct up to 3 additional incremental capacity auctions for the delivery year beginning June 1, 2021.  However, in the past the incremental capacity auctions have had little impact on the overall capacity price.