Posted on 08/25/2015 8:02:54 AM PDT by thackney
Exelon said three of its nuclear power plants did not clear the PJM capacity auction for the 2018-19 planning year.
The Quad Cities nuclear plant in Illinois, Oyster Creek in New Jersey, and Three Mile Island nuclear power plant in Pennsylvania will not receive capacity revenue from this auction, according to The Wall Street Journal. PJM said it would increase payments to power generators by 37 percent beginning in June 2018, increasing to $164.77 per megawatt per day. The increase is an almost $45 jump over the previous amount reached in auction last year. Power producers bid for long-term contracts to supply electricity, and businesses offer to pay for improvements in efficiency or to cut grid power, the article said.
Exelon said it would consider other things, including EPA’s Clean Power Plan, in its decisions about future operations of the plants. In May 2014, Exelon's Byron, Quad Cities and Oyster Creek plants were all priced out of auction by competing power providers. The Oyster Creek plant is scheduled to close in 2019, and Exelon has said it may consider closing more plants.
Natural gas-fired power project clears PJM auction
http://www.power-eng.com/articles/2015/08/natural-gas-fired-power-project-clears-pjm-auction.html?cmpid=enl-poe-weekly-august-24-2015&eid=294715858&bid=1160195
PSEG Power said that its planned 540-MW natural gas-fired combined-cycle power plant cleared PJM’s Reliability Pricing Model Base Residual Auction.
The $600 million Sewaren 7 project is scheduled to begin construction on early 2016 and be completed in summer 2018. It will be built at the existing Sewaren Generating Station in New Jersey, and will replace units 1-4, which will be retired after almost 70 years of operation. The plant will run on natural gas and ultra-low-sulfur distillate fuel oil as a back up.
$119.77 to $164.77 a 35% increase in one year, thanks Obama!
About PJM
Acting as a neutral, independent party, PJM operates a competitive wholesale electricity market and manages the high-voltage electricity grid to ensure reliability for more than 61 million people.
Is this a Quango, a quasi-autonomous non-governmental organisation?????
My guess is that I pay for it as a ratepayer, taxpayer, consumer...
What is it?
http://www.pjm.com/about-pjm/who-we-are.aspx
PJM Interconnection is a regional transmission organization (RTO) that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.
Acting as a neutral, independent party, PJM operates a competitive wholesale electricity market and manages the high-voltage electricity grid to ensure reliability for more than 61 million people.
PJM’s long-term regional planning process provides a broad, interstate perspective that identifies the most effective and cost-efficient improvements to the grid to ensure reliability and economic benefits on a system wide basis.
An independent Board oversees PJM’s activities. Effective governance and a collaborative stakeholder process help PJM achieve its vision: “To be the electric industry leader – today and tomorrow – in reliable operations, efficient wholesale markets, and infrastructure development.”
An overview of PJM is available, along with the latest Annual Report. Watch the video for an overview of the United States electricity grid. You can contact us to request additional information.
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I would hope their cost is funded through the electrical sales cost.
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http://www.pjm.com/~/media/about-pjm/newsroom/annual-reports/2014-financial-report.ashx
PJM Settlement, Inc. (PJM Settlement) is a wholly owned
subsidiary of PJM, organized as a Pennsylvania nonprofit
corporation, and is a FERC-regulated entity that began
operations on January 1, 2011. PJM Settlement was
formed to handle all of the credit, billing and settlement
functions for PJM’s members’ transactions in the PJM
markets and for transmission service. Prior to 2011,
these functions were completed by PJM. PJM Settlement
acts as a counterparty to members’ pool transactions
in the PJM markets. For the pool transactions in the
PJM markets, flash title passes through PJM Settlement
immediately prior to passing to the ultimate buyer and
seller of the product. This arrangement reinforces PJM’s
authority to continue to net a member’s offsetting financial
positions in PJM markets for credit and billing purposes;
provides clarity in PJM Settlement’s legal standing to
pursue collection from a bankrupt member; and also
complies with the FERC recommendation on credit policy
requirements for competitive wholesale electricity markets.
Sorry, I hit return to soon.
PJM recovers its administrative costs through three elements
under the Open Access Transmission Tariff (Tariff).
The first element is a composite rate. Beginning
October 1, 2011, the composite rate was 29 cents per
megawatt-hour (MWh).
The second element is a rider for the Advanced Second
Control Center (AC2). The Tariff establishes a specific
mechanism for PJM to collect from its members the
actual costs to construct and operate AC2. The recovery of
those costs is from a formula rate set forth in a separate
schedule in the Tariff. The recovery is capped at the
capitalized investment costs and operating costs of
AC2. PJM began to recover costs under this rider in July
2008. The rider is scheduled to expire seven years from
November 2011, which was the in-service date of the
AC2 energy management system. During 2014, 2013 and
2012, $27.8 million, $28.0 million and $28.8 million were
billed under this rider, respectively.
The third element provides for accumulation of a financial
reserve up to six percent of annual revenues and
subsequent refunds to PJM’s members, if applicable.
PJM Settlement recovers its administrative costs under
a separate schedule under the Tariff.
I don’t mean to be dense, but this auction business is not real clear. Is the power production cost of the nuc plants too expensive to be competitive? That is really the only conclusion I can reach based on the need to close the nuc plants. And then there is the question of base load lost, when and if the three are closed, versus what remains for base load after closure.
I posted the two articles in the same thread to point out that A natural gas powered generator underbid a nuclear powered generator for base load power supply.
Natural Gas powered electrical generation has grown cheaper both because of lower fuel cost and significantly improved efficiencies.
The different power suppliers bid against each other to PJM to supply the power. The cheapest wins. (when meeting other criteria)
PJM received enough bids to meet their base load requirements. This gas powered plant, and others, have added to the power generation capacity.
Thanks for posting this along with your other related posts from time to time.
Thank you for the explanation.
I have some experience with nonprofit corporations; they did not plan it to be a non profit; unfortunately it worked out like that.
Thanks.
“Natural Gas powered electrical generation has grown cheaper both because of lower fuel cost and significantly improved efficiencies”.
However, the bid must not have had coal as a competitor. In our area a new gas generating plant is still five to ten times more expensive than coal according to the producers. We are seeing the direct result with a new gas plant in Cheyenne WY and the early shut down of at least three coal fired plants.
No way that is true. A modern combined-cycle power-turbine gas turbine is about twice as efficient as the coal boiler. The price of natural gas is not 10 to 20 times as expensive as coal.
In fact, price per BTU, central appalachia coal prices are slightly above the natural gas prices. Powder River coal is about 1/5 the cost, not 1/10 to 1/20th.
Electricity Monthly Update
http://www.eia.gov/electricity/monthly/update/resource_use.cfm#tabs_spot-2
False. This wasn't a single winner. Multiple power suppliers including coal had winning bids. But no single power source supplies enough base power to come close to meeting the needs. Multiple companies including multiple fuels sources won including coal, natural gas and nuclear.
The capacity offered in the 2018/2019 BRA resulted from both new generating resources and uprates to existing resources including gas, diesel, coal, wind, and nuclear resources. The largest growth remains in gas turbines and combined cycle plants.
Thanks once again. Your response helps one to understand why a producer would attempt to skew the actual cost and justify a requested price increase to the public utilities commission. Although, it isn’t cheap to build a new plant.
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