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Commissioner Moeller Statement
July 23, 2015
Docket Nos. ER15-623-002, et al. PDF

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PJM’s Capacity Performance

“In conditionally accepting PJM’s Capacity Performance Filing, the Commission previously recognized that “PJM’s proposal is appropriate, because it creates the same expectations for all Capacity Performance Resources (i.e., the expectation that such resources will be available to provide energy and reserves when called upon), without regard to technology type.”1 Today’s order granting rehearing in part simply applies this reasoning to participation by non-generation resources as Capacity Performance Resources in Transition Auctions. If demand response, energy efficiency, or other non-generation resources satisfy the Capacity Performance Resource requirements, then there is no cognizable reason to bar them from auction participation merely because service will be rendered during the transition period. To do so would constitute undue discrimination based on technology type and could unnecessarily inflate auction prices.

“While a close reading of PJM’s proposed tariff provisions indicates that non-generation resources would be excluded from participation in the Transition Auctions, PJM’s voluminous filing did not make this fact, or its underlying justification, clear to PJM stakeholders or the Commission. PJM initially represented that its Capacity Performance proposal “preserves its current approach” to demand response participation,2 in contrast to its more recent position that it intended to limit non-generation resource participation in the Transition Auction due to the uncertainty surrounding EPSA.3 Depending on potential Supreme Court action in EPSA, it’s possible that PJM’s auction results may be disrupted; however, as the Commission previously found, “it is unavoidable that some uncertainty is inherent in the current stance of the EPSA case,” and addressing this issue is premature and would necessarily impact options the Commission could undertake in response to the EPSA decision.4

“Moreover, while the Advanced Energy Management Alliance Coalition’s (AEMA) answer was ultimately rejected on procedural grounds, it correctly pointed out that some non-generation resources will require investments and adjustments in order to qualify as Capacity Performance Resources, just as some generation resources will not.5 PJM has never demonstrated that eligibility to qualify as a Capacity Performance Resource should depend on whether resources will make certain capital investments, or why such a requirement should apply only in Transition Auctions.

“For these reasons, granting in part rehearing, as well as the associated complaint, is procedurally appropriate and necessary, in light of the Commission’s inadvertent approval of unjust and unreasonable tariff language.






                                               

    1PJM Interconnection, L.L.C., 151 FERC ¶ 61,208, at P 99 (2015).
    2 PJM December 12, 2014 Filing, Docket No. ER15-623-000, at 5-6.
    3PJM July 9, 2015 Answer, Docket No. EL15-80-000, at 8-11 (citing EPSA v. FERC, 753 F.3d 216 (D.C. Cir. 2014) (EPSA), cert. granted, Nos. 14-840, 14-841). The D.C. Circuit stayed its mandate vacating the rule pending outcome of the appeal to the U.S.
    4See PJM Interconnection, L.L.C., 150 FERC ¶ 61,251, at P 32 (2015) (order rejecting filing as premature).
    5AEMA July 14, 2015 Answer, Docket No. EL15-80-000, at 6-7.