If you want to learn more about PJM’s capacity auctions, here is a good story from Reuters about the auction results that will be released after this year’s auctions close on Friday.
This is an important date for people following the PATH zombie. Remember when PATH tried the unsuccessful “60 days after whenever” game on the National Park Service? Here’s what they told the NPS:
As indicated by the PJM Staff report, additional analysis will be undertaken after completion of the May 2012 forward capacity auction results. The time required by PJM Staff to perform such analysis thereafter is not yet known. [emphasis added]
The NPS didn’t buy that line, and cut off the PATH EIS process for good. But then we got this statement from PJM’s Steve Herling in early March, as reported by the State Journal’s Pam Kasey:
PJM will make a recommendation about PATH to its board of managers in June or July. It will make its recommendation based on information gleaned in the first part of the year about planned generation construction and retirements and about consumer commitments to reduce demand during peak periods.
Note that Herling says that PJM will make its final decision on PATH’s fate in “June or July,” in other words, after the May capacity auction results are released.
Remember that one of PJM’s original arguments for PATH was that capacity prices in eastern PJM were much higher than prices in western PJM. They didn’t say it out loud, but this was the real reason for Project Mountaineer and PATH — to increase the profits of power generators in western PJM and also to raise electric rates in Michigan, Illinois, Indiana, Ohio and West Virginia by sending more of their power to East Coast states.
In the years since PATH was proposed in 2006, the capacity auction price difference has been reduced dramatically, mainly because of the rapid expansion of demand resources (from marketable demand management) on PJM and expanding generation on the East Coast.
If that trend continues at this year’s auction, it is quite likely that PJM will pull the plug on PATH, at least that is the latest Kremlinology hint from PJM headquarters at Valley Forge. We’ll be looking for the PJM press release on this years auction results.