It is "clear" that PJM's current capacity market construct is, "not sufficient to ensure reliability," Exelon CEO Christopher Crane said during an earnings call yesterday.

Discussing FERC's approval of a delay in PJM's May base residual capacity auction while FERC considers PJM's capacity "performance" proposal, Crane said, "It is clear from this action that FERC appreciates that the old rules are not sufficient to ensure reliability, and that changes must be made," Crane said.

On this, we agree, and it'd be apparent to anyone with any common sense for nearly a decade.

However, Exelon has apparently suddenly come to the conclusion that the current PJM capacity market will not ensure reliability, as it was only a few years ago that Exelon was not only pushing a capacity market to solve Texas' alleged reliability problem, but specifically praised the PJM capacity market (with these now "old rules") as successfully ensuring reliability.

In comments filed with the PUCT on February 10, 2012 in Project 37897, Exelon said that (citing the Brattle report), "PJM's capacity market has been successful in meeting resource adequacy at efficient prices over time."

"[W]hile not perfect, PJM's capacity market is a success story in assuring reliability at efficient prices," Exelon said in those 2012 comments.

"Given the success of PJM's resource adequacy construct, Exelon supports the mechanism of a forward market for capacity to provide future price signals," Exelon said in those 2012 comments.

We'd note that PJM has not undergone any major change in its capacity market design since Exelon's 2012 comments, so Crane's comments yesterday is an admission that those same market rules that Exelon was praising, to Texas regulators in 2012, are, in fact, simply inadequate to assure reliability. If we were more cynical, we'd ask when Exelon suddenly came to this conclusion

We'd further note that despite the admission that current PJM capacity market rules do not ensure reliability, customers still pay $7 billion annually in capacity (2017-18 delivery year) under the pretense that this payment will ensure reliability.

Of course, Exelon's proposal to fix PJM's problem is to layer more costs on customers, through yet another administratively determined product -- capacity performance, under which resources will command a premium price for providing the very reliability we were told three years ago that the old capacity market was already assuring.

Any rational consumer would simply walk away from such bullying, as would occur in a free market. But among restructured electricity "markets", only Texans have that choice -- and companies like Exelon want to take that away, too.