Recent Action

Early in 2020, FERC directed updates to PJM’s Minimum Offer Price Rule (MOPR). The MOPR distorts the capacity market, which was designed to be competitive, by discriminating against energy resources that receive direct or indirect state support. This determination undermines state Renewable Portfolio Standards or Clean Energy Standards. With the implementation of the MOPR, clean energy resources such as wind and solar will be artificially priced out of participation in the PJM capacity market. Electric costs to consumers are expected to increase significantly. The real impacts of the MOPR are likely to be seen in three years.

State Responses

In response to the MOPR, states like Illinois, Maryland, and New Jersey are considering leaving the capacity market through a Fixed Resource Requirement (FRR). This would require states to manage their own capacity market for five years. Because the MOPR was set without any state consultation, over 70 state legislators have called on PJM leadership to work with states to reform the capacity market to support clean energy goals. Pennsylvania and Maryland legislators have also been speaking out about the need for reform at PJM.