PJM Files Regulation Market Tariff Changes To Reduce Occurrence Of Large Spikes In Clearing Prices
On November 20, 2018, in FERC Docket No. ER19-383-000, PJM submitted for filing revisions to the PJM Tariff, Attachment K – Appendix, section 3.2, and the PJM Operating Agreement, Schedule 1, section 3.2, to establish a Regulation market benefits factor clearing threshold, to remove the use of minimally effective resources in the calculation of the Regulation Market Clearing Price (“RMCP”).
PJM said in a market notice that, "The proposed revisions will reduce the occurrence of large spikes in clearing prices that have recently been observed in PJM’s Regulation market by establishing a new rule under which RegD (dynamic) resources with a benefits factor of less than 0.1 will not clear in the Regulation market."
In its filing, PJM said, "Through this proposal, the frequency of such large upward clearing price fluctuations due to aberrations in the outcomes of certain formulas in the Tariff and Operating Agreement will be reduced, thereby decreasing the likelihood of unjust and unreasonable outcomes for Market Participants."
PJM requested the revisions become effective January 21, 2019.