Iulia Gheorghiu, Utility Dive
PJM Interconnection filed a proposal on Friday with the Federal Energy Regulatory Commission to update its energy market price formation rules, due to an impasse among its stakeholders.
The grid operator offered reserve pricing rules based on concepts implemented by other regional transmission organizations and independent system operators. PJM proposed separate pricing calculations for the day-ahead and real-time markets to reflect the different opportunity costs of a resource in each market.
A key question is how the new rules will treat different types of generation sources. "As the system becomes more dependent on renewable resources, the need for flexibility from all types of resources will increase due to the uncertainties involved in forecasting actual wind conditions and cloud cover on a given day," PJM said in a statement. "More effectively valuing this flexibility will allow for the ongoing seamless integration of these resources in the future," the statement continued.