Asim Z. Haque is senior vice president for governmental and member services at PJM Interconnection.
Consumer electricity bill increases deserve attention, as families across the nation are struggling to make ends meet. The conversation about these increases is critical but must be factual to allow for thoughtful problem solving.
In the June 4 guest column, “You are about to pay 26% more for electricity. DeWine can stop this,” Tom Bullock correctly states that PJM Interconnection is a regional grid operator and acts as the air traffic controller of electricity across a multistate power grid.
PJM functions as a nonprofit, is fully regulated by the Federal Energy Regulatory Commission and has one mission: to keep the lights on for the 67 million people that we serve across 13 states and the District of Columbia.
However, the rest of Bullock’s column includes misdirection and a conflation of concepts that must be cleared up.
The energy industry can be complicated, but the reason why your electricity bill is increasing is not.
Demand is up, supply is down
Demand is up significantly due to the growth of data centers that power the race to become the global leader in artificial intelligence.
Supply is decreasing due to federal and state decarbonization policies that have forced generators off the system, as well as some economic-based plant retirements. In any market, when demand is up and supply is down, the net result is an increase in pricing.
New supply is coming onto the system, but not at the pace we need it to.
Bullock falsely points to 3,000 projects currently being “stuck” in PJM’s queue. This number is five times the number of projects we are processing. (The queue is the process through which PJM power engineers study prospective generation projects so they can safely plug into the grid.)
The reality is that PJM reformed this process in 2022 to study a massive uptick in new renewable projects. We started with more than 200 gigawatts worth of projects to process in 2023; today there are 63 GW remaining, and they will be through the process in 2025 and 2026.
More importantly, there are 46 GW of mostly renewable resources that have PJM’s approval to construct; that’s enough to power about 40 million homes. These resources are welcome additions to the grid but are facing challenges in constructing that have nothing to do with PJM, such as supply chain, financing and state/federal permitting.
‘We need every watt we can get’
Bullock also creates a false equivalency between more renewable energy leading to lower pricing. The truth is that more power, period, will do that. That means keeping our existing supply, along with adding new supply.
Further undermining Bullock’s rhetoric is the principle that renewables do not have the same reliability value as the resources that make up the bulk of our current fleet (nuclear, coal and gas).
Nuclear is the gold standard, operating at 95% reliability (a metric called Effective Load Carrying Capability), while a fixed-tilt solar plant operates at 8% and tracking solar (panels that adjust their tilt throughout the day to maximize exposure) at 11%. To be sure, we need every watt we can get to meet demand and keep costs affordable. But simply adding more renewable power is not a panacea to achieving that result.
PJM has been warning about our concerns on this impending supply/demand imbalance and expected price increases for some years now, both at the state and federal levels.
The Ohio General Assembly as well as Gov. Mike DeWine are attuned to this issue, and we have worked with them collaboratively to try to bring as much new supply to the system as possible through our markets structure.
This challenge requires a factual understanding of what is happening with these supply/demand fundamentals. Blaming the nonprofit grid operator is one way to proceed, but to use Bullock’s own words, “Ohioans deserve better.”
Asim Z. Haque is senior vice president for governmental and member services at PJM Interconnection.
This article originally appeared on The Columbus Dispatch: ‘We need every watt we can get.’ PJM not to blame for soaring electricity bills. | Opinion
Reporting by Asim Z. Haque / The Columbus Dispatch
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