The Cost of Slow-Walking Clean Energy in PJM
VALLEY FORGE, PA – Yesterday PJM announced the results of its 2025/26 capacity auction, which revealed that costs will be roughly seven times greater than in 2024/25. The total capacity bill for the region will increase from $2.4 billion to about $14.7 billion, which could increase retail power bills by as much as 29% starting mid-2025.
Following is a reaction from Tom Rutigliano, senior advocate with the Sustainable FERC Project at NRDC (Natural Resources Defense Council.)
“The bill is suddenly due for an overreliance on fossil fuels and inadequate planning for a more affordable, diverse power grid in PJM. And customers throughout 13 eastern and midwestern states and D.C. will be the ones who pay the price."
“Make no mistake: this was foreseeable and preventable. This is what happens when regulators sideline a wealth of historically affordable clean energy resources waiting at their doorstep and the transmission needed to bring them online. For years, the largest grid operator in the eastern U.S. has all but refused to diversify its resource mix and bring new energy online, and instead opted to depend excessively on an aging fossil fuel fleet while ignoring its reliability failures. This sticker shock is a direct result of recent regulatory changes made to address those reliability failures.”
“With so few gas alternatives online in PJM to absorb the shock, making up the difference is coming at a steep price that hard-working families and businesses in the region will pay – and revealing what a bad deal they had been getting for a supposedly reliable gas-run power system.”
“Diverse power grids are critical for reliability, and now we see just how critical they are for affordability. With wind and solar only making up an abysmal two percent of resources in this auction, but the overwhelming majority of PJM’s project queue, it is clearer than ever that PJM needs to rapidly scale up new energy resources to protect customers and resilience.”
“The cost of PJM’s interconnection delays has now reached billions of dollars. Leaders in PJM states must demand accountability and solutions from their grid operator before they have to pay billions more in the next auction just five months from now.”
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NRDC (Natural Resources Defense Council) is an international nonprofit environmental organization with more than 3 million members and online activists. Established in 1970, NRDC uses science, policy, law and people power to confront the climate crisis, protect public health and safeguard nature. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Beijing and Delhi (an office of NRDC India Pvt. Ltd).