• Grid operator is planning backstop auction in September
• Includes 2 GW in natural gas due to coal plant conversions

PJM Interconnection’s 2028/2029 Base Residual Auction cleared 6,831 MW short of the grid operator’s reliability requirement and reached the established USD 325/MW-day price collar for the entire 13-state footprint.

The grid operator released the results of the auction on July 14 prior to a press conference, where PJM officials highlighted that the price marked a 2.5% decrease from the 2027/2028 auction results. Without the price collar in place, the auction would have cleared at USD 554.72/MW-day across the footprint, and as high as USD 776.69/MW-day in the Chicago region, officials said.

Overall, PJM secured 138,318 MW of unforced capacity generation (UCAP) and demand response to meet projected electricity needs for the 2028/2029 Delivery Year.

Regions under the Fixed Resource Requirement acquired an additional 10,864 MW in UCAP, for a total of 149,182 MW available to serve forecasted peak electricity demand, plus a reserve margin.

PJM marked an increase of 6,500 MW in UCAP resources, with some overlap, officials noted. That includes approximately 5,600 MW of natural gas — half of which was a marked increase due to a higher Effective Load Carrying Capability (ELCC) value.

Roughly 2,000 MW of natural gas in this auction also came due to coal plants converting to natural gas. The grid operator noted a loss of 3,000 MW of coal, both due to retirements and conversion to gas.

PJM officials pointed to a 650 MW increase in solar and a 270 MW increase in battery and hybrid resources.

They added that while the procured resources fell short, it wasn’t a surprise given that the previous auction saw a 6,500 MW shortfall. However, they were struck by the amount of storage resources that responded to the auction, stating that the 270 MW is an early signal of “more to come” in future auctions.

The results come as PJM is preparing to file a proposal to the Federal Energy Regulatory Commission (FERC) to hold a reliability backstop auction to procure resources that can then engage in bilateral contracts with data centers, in an effort to meet the predicted demand from hyperscalers.

PJM told media during the call that it wants to implement the backstop auction in September and plans to make a filing by the end of July.

Auction Statistics

The RPM forecasted peak load for the 2028/2029 Delivery Year is approximately 2,000 MW higher than the forecast used for the 2027/2028 capacity auction.

The supply mix for RPM cleared and FRR committed resources in this auction in UCAP includes: 46% natural gas, 20% nuclear, 18% coal, 5% demand response, 4% hydro, 2% wind, 2% oil and 1% solar.

Natural gas increased 5,639 MW UCAP primarily from an increase in accredited UCAP factors, coal units that converted to natural gas and units that participated in this auction that did not participate in the last auction.

Coal decreased 2,941 MW UCAP primarily from retirements or conversion to natural gas. Solar increased 651 MW UCAP from new or planned resources.

Supply offered into the 2028/2029 BRA increased 3,447 MW (UCAP), from 136,148 MW in the 2027/2028 BRA to 139,595 MW in the 2028/2029 BRA.

The auction cleared 525 MW UCAP of new generation and generation uprates.

The total amount of cleared capacity increased by 3,733 MW UCAP, from 134,585 MW in the 2027/2028 BRA to 138,318 MW UCAP in the 2028/2029 BRA.

The total amount of supply in the PJM service area increased from 200,994 MW to 202,288 MW, or an increase in the total amount of supply by 1,294 MW of installed capacity.

This auction also saw the continued trend of the addition of large data center loads to the load forecast that forms the basis of the reliability requirement.