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FERC Accepts PJM Peak Shaving Adjustment Proposal

May 06,2019

FERC accepted proposed revisions to PJM’s Open Access Transmission Tariff (OATT), Amended and Restated Operating Agreement (OA), and the Reliability Assurance Agreement Among Load Serving Entities in the PJM Region (RAA) to reflect load reductions from Summer-period Demand Response Resources (Summer Demand Resources) in load forecasts for PJM’s capacity market (Peak Shaving Adjustment).

Notably, FERC accepted PJM's proposal that only Summer Demand Resources that are governed by a tariff or order from a Relevant Electric Retail Regulatory Authority RERRA may participate in the Peak Shaving Adjustment program.

"We accept PJM’s proposal to limit participation in the Peak Shaving Adjustment program to “resources governed by a tariff or order adopted by” a RERRA. We find that PJM’s proposal is not unduly discriminatory because EDCs with RERRA-sponsored load curtailment programs are not similarly situated to EDCs without RERRA-sponsored load curtailment programs. We find that PJM has sufficiently demonstrated that the RERRA-sponsorship requirement is just and reasonable because it provides PJM with greater confidence in the durability of the peak-shaving program, as load reductions provided by RERRA-sponsored resources are more likely to continue over time, creating stability in load forecasts, which in turn will ensure efficient transmission planning and resource investment," FERC said

PJM also proposed that Summer Demand Resources participating in the Peak Shaving Adjustment cannot participate in PJM’s capacity market as Price Responsive Demand or as Demand Resources (both emergency and economic) or in PJM’s energy market and ancillary services market.

FERC accepted this proposal as well

"We find that PJM’s proposed prohibition on participation in other PJM markets is a just and reasonable method of preventing the double counting of MW reductions from Summer Demand Resources enrolled in the Peak Shaving Adjustment program," FERC said

FERC also accepted PJM's proposal to amend its governing documents to explain that Customer Baseline Load (CBL) will be the metric used for measuring the performance of peak shaving programs, add a new definition for Peak Shaving Adjustment, and amend the Price Responsive Demand (PRD) plan submission deadline for the 2022/2023 Delivery Year.

Docket ER19-511

FERC   Demand Response   PJM  

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