PJM Interconnection has put forward the RRI plan to fast-track interconnection processes for up to 50 shovel-ready generating projects by January. The aim of this initiative is to address potential grid reliability issues. However, many stakeholders, including renewable energy developers, argue that this proposal is discriminatory and would give undue advantage to certain load-serving entities looking to monopolize opportunities, particularly to serve data center loads.
Objections from Developers
Developers have expressed concerns that the proposal lacks a clear, defined need and allege that PJM has not provided data to support claims of increased data center loads necessitating such measures. They argue that the initiative stands to benefit entities seeking to retain, revive, or build new power plants, sidelining projects that have been waiting for years for consideration. Additionally, former FERC Chairman Norman Bay, representing other market participants, pointed out that PJM has an installed reserve margin of 29%, which is significantly above its 17.7% target, suggesting there is no immediate resource adequacy threat.
Potential Legal Issues
Further objections include the potential violation of the filed rate doctrine and FERC’s prohibition against retroactive ratemaking. This has raised significant concerns among developers and other stakeholders about the legality of the proposed measures. Many argue that fast-tracking certain projects at the expense of others that have been in the queue for years could lead to discriminatory practices and undermine the principles of fair market competition. AES, a utility and generation company, has also criticized the proposal as incomplete and counterproductive, arguing that the stakeholder process followed by PJM was rushed and inadequate.
Call for State Involvement
Pennsylvania Governor Josh Shapiro and other entities suggest giving states a more significant role in selecting projects for the special interconnection review. They propose that states should be able to score projects based on viability and permit likelihood, reinforcing the call for a more inclusive, data-supported approach. This would ensure that the most feasible and necessary projects are prioritized, not just those pushed by influential entities. Such a measure would also foster more balanced and equitable development of the grid infrastructure.
PJM’s Stance and Counterarguments
Despite these criticisms, PJM maintains that they have documented grid reliability concerns over nearly three years and assert the proposal is open to all fuel types and technologies, not just specific ones. They argue that the initiative is necessary to address imminent reliability risks and ensure a stable energy supply. PJM also notes interest from new and uprating nuclear resources, indicating broad participation and support for the initiative across various sectors. However, this has not quelled the concerns of those who believe the process has been neither transparent nor fair.
Conclusion
PJM Interconnection has proposed the RRI plan to expedite the interconnection process for up to 50 ready-to-go generating projects by January. This initiative aims to mitigate potential grid reliability issues. The RRI plan targets specifically shovel-ready projects, believed to be instrumental in bolstering the grid’s robustness and ensuring consistent service delivery. However, the proposal has sparked concerns among a wide range of stakeholders. Renewable energy developers, in particular, criticize the plan as discriminatory, arguing that it unjustly favors certain load-serving entities, allowing them to dominate the market. This criticism revolves around the potential for these entities to monopolize opportunities, especially for serving data center loads which are critical in the digital age. Stakeholders are worried that the plan could skew market dynamics and create inequities in grid access. The debate underscores the tension between rapid infrastructure development and the need for fair, inclusive policies that do not unfairly benefit specific groups at the expense of broader competition and innovation.
