Containing Consumer Costs

What's it all about? Decisions made at PJM impact your electricity bill. We are constantly pushing PJM to reform its rules to make them more consumer-friendly.

1. Over-procurement: PJM has a pattern of consistently over-procuring generation by as much as double the cushion that is already built into the system. We pay for capacity through our electric bills, so PJM's pattern of over-procurement costs us dearly. For example, in the 2021-2022 auction alone, it's estimated that consumers paid $4.4 billion for 8,000 MW of excess reserve capacity. It is in consumers’ best interest to have healthy reserves, but not to pay for double the reserve we need. PJM has not yet achieved this balance.

2. Circuit breaker: In an extreme winter storm when natural gas plants fail to operate, there is high demand but limited supply. The higher prices will not incentivize a power plant to ramp up operations if it's not able to function in the bad weather. There should be a price cap to prevent ratepayers from getting slammed with high costs, like what happened during Winter Storm Uri in Texas. We have pushed for a "circuit breaker"--a mechanism to cap prices when regular market signals go haywire--something that is becoming more common with climate change.