Date: December 18, 2025
Contact: Katie Thompson, Director of Communications & Outreach, kthompson@keealliance.org, (215) 792-2101
Yesterday, PJM announced the result of its latest capacity market auction, which was held in earlier this month. PJM issued a report of the results, showing that the price for the pledge of future power on the electricity grid cleared at the cap set by a lawsuit initiated last year by PA Governor Josh Shapiro and settled in an agreement with PJM. According to a simulation presented by PJM in the report, the price, which was $333.44/MW-day of unforced capacity with the cap, would otherwise have been $529.80/MW-day—a substantially higher figure.
Some other points about the auction are notable. First, Demand Response (DR) resources/ offered and “cleared” amount increased for the 2027/2028 year to 7,800 MW, reversing a downward trend observed since 2021/2022. DR resources bring capacity without having to build new generation and align with energy efficiency, “smart grid”, and other solutions that help to reduce peak demand requirements.
Second, the amount of capacity procured – 145,777.1 MW of Unforced Capacity (UCAP) — fell well below the reliability requirement. According to PJM, “RPM [Reliability Pricing Model] cleared 14.8% Installed Reserve Margin (IRM) or 5.2 percentage points below the 20% IRM [Installed Reserve Margin]. The IRM is the reserve margin determined to be necessary to maintain a one-day-in-10-year Loss of Load Expectation (LOLE).” PJM noted that according to its own rules, if shortfall of greater than one percentage point continues for two additional auctions, it will trigger a Reliability Backstop Auction, and the rate structure requires that PJM make a filing with FERC prior to its execution.
It is also notable that the Independent Market Monitor filed a complaint about PJM to FERC in late November, arguing that it is irresponsible for PJM to allow any additional data centers to come online in its Regional Transmission Operator territory because PJM cannot meet the demand.
EEA supports the statement from the Clean Power PA Coalition, which noted, “The latest PJM capacity auction signals still more electric bill increases ahead for millions of Pennsylvanians. Even with Governor Shapiro’s effective intervention to cap PJM auction prices, electric bills are expected to increase yet again with this auction.” It went on to state: “The backlogged PJM process to approve new energy sources to the grid, especially many backlogged cheap, clean energy projects awaiting approval, means that PJM is not keeping up with the rapidly growing demand for electricity, driven largely by huge data centers. This failure to bring new energy online quickly enough, combined with PJM’s outmoded design for purchasing energy and its failure to build out more electric transmission, is driving up prices for all of us.”