Modernizing Electricity Market Design; Notice Inviting Post-Technical Conference Comments, 18523-18525 [2021-07324]

Download as PDF Federal Register / Vol. 86, No. 67 / Friday, April 9, 2021 / Notices Accessible Format: On request to the program contact person listed under FOR FURTHER INFORMATION CONTACT, individuals with disabilities can obtain this document and a copy of the application package in an accessible format. The Department will provide the requestor with an accessible format that may include Rich Text Format (RTF) or text format (txt), a thumb drive, an MP3 file, braille, large print, audiotape, or compact disc, or other accessible format. Electronic Access to This Document: The official version of this document is the document published in the Federal Register. You may access the official edition of the Federal Register and the Code of Federal Regulations at www.govinfo.gov. At this site you can view this document, as well as all other documents of the Department published in the Federal Register, in text or Portable Document Format (PDF). To use PDF you must have Adobe Acrobat Reader, which is available free at the site. You may also access documents of the Department published in the Federal Register by using the article search feature at www.federalregister.gov. Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department. Ruth Ryder, Deputy Assistant Secretary for Policy and Programs, Office of Elementary and Secondary Education. [FR Doc. 2021–07291 Filed 4–8–21; 8:45 am] BILLING CODE 4000–01–P DEPARTMENT OF ENERGY Environmental Management SiteSpecific Advisory Board, Idaho Cleanup Project Office of Environmental Management, Department of Energy. ACTION: Notice of open virtual meeting. AGENCY: This notice announces an online virtual meeting of the Environmental Management SiteSpecific Advisory Board (EM SSAB), Idaho Cleanup Project (ICP). The Federal Advisory Committee Act requires that public notice of this online virtual meeting be announced in the Federal Register. DATES: Thursday, April 29, 2021; 8:00 a.m.–4:00 p.m. The opportunities for public comment are at 10:00 a.m. and 2:45 p.m. MT. This time is subject to change; please contact the Federal Coordinator (below) for confirmation of times prior to the meeting. SUMMARY: VerDate Sep<11>2014 17:45 Apr 08, 2021 Jkt 253001 This meeting will be held virtually via Zoom. To attend, please contact Jordan Davies, ICP Citizens Advisory Board support staff, by email jdavies@northwindgrp.com or phone (720) 452–7379, no later than 5:00 p.m. MT on Tuesday, April 27, 2021. To Sign Up for Public Comment: Please contact Jordan Davies by email, jdavies@northwindgrp.com, no later than 5:00 p.m. MT on Tuesday, April 27, 2021. FOR FURTHER INFORMATION CONTACT: Danielle Miller, Federal Coordinator, U.S. Department of Energy, Idaho Operations Office, 1955 Fremont Avenue, MS–1203, Idaho Falls, Idaho 83415. Phone (208) 526–5709; or email: millerdc@id.doe.gov or visit the Board’s internet home page at: https:// www.energy.gov/em/icpcab/. SUPPLEMENTARY INFORMATION: Purpose of the Board: The purpose of the Board is to make recommendations to DOE–EM and site management in the areas of environmental restoration, waste management, and related activities. Tentative Topics (agenda topics may change up to the day of the meeting; please contact Danielle Miller for the most current agenda): • Recent Public Outreach • ICP Overview • Integrated Waste Treatment Unit (IWTU) Update • History of the Idaho Settlement Agreement • Naval Reactor Facility Decontamination and Demolition Activities • Supplemental Environmental Projects (SEPs) • Hydrology of the Idaho National Laboratory Site and Geologic Formations of the Snake River Plain Aquifer Public Participation: The online virtual meeting is open to the public. Written statements may be filed with the Board either before or within seven days after the meeting by sending them to Jordan Davies at the aforementioned email address. The Deputy Designated Federal Officer is empowered to conduct the meeting in a fashion that will facilitate the orderly conduct of business. Individuals wishing to make public comments will be provided a maximum of five minutes to present their comments. Minutes: Minutes will be available by writing or calling Danielle Miller, Federal Coordinator, at the address and telephone number listed above. Minutes will also be available at the following website: https://www.energy.gov/em/ icpcab/listings/cab-meetings. ADDRESSES: PO 00000 Frm 00030 Fmt 4703 Sfmt 4703 18523 Signed in Washington, DC, on April 5, 2021. LaTanya Butler, Deputy Committee Management Officer. [FR Doc. 2021–07302 Filed 4–8–21; 8:45 am] BILLING CODE 6450–01–P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Docket No. AD21–10–000] Modernizing Electricity Market Design; Notice Inviting Post-Technical Conference Comments On March 23, 2021, the Federal Energy Regulation Commission (Commission) convened a Commissioner-led technical conference to discuss the role of the capacity market constructs in PJM Interconnection, L.L.C. (PJM), ISO New England Inc., and New York Independent System Operator, Inc. in an environment where state policies increasingly affect resource entry and exit. The technical conference included the discussion on the implications of retaining the expanded minimum offer price rule (Expanded MOPR) in the PJM capacity market, as well as prospective alternative approaches that could replace PJM’s Expanded MOPR. All interested persons are invited to file initial and reply post-technical conference comments on the topics in Parts I and II below. Commenters may reference material previously filed in this docket, including the technical conference transcript, but are encouraged to avoid repetition or replication of previous material. Commenters need not answer all of the questions, but commenters are encouraged to organize responses using the numbering and order in the below questions. Commenters are encouraged to limit their responses to the questions identified below and not provide significant background or other material. Initial comments must be submitted on or before April 26, 2021. Reply comments must be submitted on or before May 10, 2021. Initial comments should not exceed 25 pages and reply comments should not exceed 15 pages. PJM’s initial and reply comments are not subject to these page limitations. I. Comments on Supplemental Notice We are seeking comments on the topics discussed during the technical conference, including responses to the questions listed in the Supplemental Notice issued in this proceeding on E:\FR\FM\09APN1.SGM 09APN1 18524 Federal Register / Vol. 86, No. 67 / Friday, April 9, 2021 / Notices March 16, 2021, in accordance with the deadlines and other guidance above. II. Comments on PJM’s Capacity Market We are also interested in comments regarding PJM’s capacity market, in accordance with the deadlines and other guidance above, as follows: A. Existing PJM MOPR Implications (1) Have circumstances regarding the nature and scope of state actions to support specific resource types (e.g., new state legislation, new or revised state subsidies, new or revised standards such as increased renewable portfolio standards, etc.) changed in the PJM footprint since the establishment of the Reliability Pricing Model? If so, should the purpose and goals of the capacity market evolve in response to this change? Please explain. (2) Please explain how the expected quantity of state supported and nonstate supported resources, by resource type, has changed since 2018. Please provide the relevant dates of relevant legislation, executive actions, rulemakings, and/or other state actions. How is the Expanded MOPR likely to affect the entry of these resources? Will the expected impact of the Expanded MOPR change over time? Please explain. (3) Is there a particular type or quantity of state supported resources that are unlikely to clear PJM’s capacity market as a result of PJM’s Expanded MOPR, in the near term or in the future? If so, please provide examples. (4) Please explain whether and, if so, how PJM’s Expanded MOPR will result in over-procurement of capacity, or ‘‘surplus capacity’’ (i.e., capacity in excess of the PJM Installed Reserve Margin), due to reasons other than the capacity market’s sloped demand curve. To the extent the Expanded MOPR results in surplus capacity, including the delayed retirement of existing resources, what are the impacts on PJM’s customers? What impact could such surplus capacity have on PJM’s energy and ancillary services markets? How do any such impacts bear on the Commission’s responsibility to ensure just and reasonable rates under the Federal Power Act? (5) Does PJM’s Expanded MOPR affect states’ willingness to remain in PJM’s capacity market? Does the Expanded MOPR compel states to choose between relying on PJM’s capacity market to meet their resource adequacy needs and achieving state policies? If so, how? Which states are relying on or are considering relying on PJM’s Fixed Resource Requirement (FRR), rather VerDate Sep<11>2014 17:45 Apr 08, 2021 Jkt 253001 than the PJM’s capacity market, as a result of the Expanded MOPR and why? (6) Please explain whether the implementation of PJM’s Expanded MOPR has led or may lead to unforeseen impacts, including those enumerated below: a. Several panelists at the conference noted the potential for greater use of the FRR construct as a result of the Expanded MOPR. Please explain any potential impacts or concerns from an increased reliance on PJM’s FRR construct in this manner (e.g., adverse impacts on capacity prices in PJM in zones that remain in the market, the reduced ability to ensure resource adequacy, etc.). b. Does the Expanded MOPR create administrative burdens for PJM, capacity resource owners, or others? If so, please explain and include details regarding the difficulties encountered. c. Does the Expanded MOPR have any impact on the ability of resources to engage in private voluntary, bilateral transactions? 1 (7) What are the benefits of the Expanded MOPR? Please explain. (8) Is it appropriate for the Commission to apply a MOPR to address state actions intended to suppress capacity market prices? Please explain why or why not? B. Potential Alternatives to Expanded MOPR in PJM (9) Should the Expanded MOPR be revised or eliminated? If so, what, if any, are any other changes to the PJM Tariff would be necessary or appropriate? Please explain fully. (10) If any changes are made to the MOPR rules, is it necessary or appropriate to combine those changes with reforms to ensure that capacity resources are properly accredited for their reliability value? (11) Please explain the timeframe in which a proposed replacement rate could be implemented to avoid delaying the December 2021 Base Residual Auction. (12) Should a MOPR designed to address only buyer-side market power (i.e., a Targeted MOPR) replace the Expanded MOPR? How should the Commission determine what constitutes a potential exercise of buyer-side market power? 2 (13) Please explain to which resources a Targeted MOPR should apply (e.g., only to natural gas-fired resources or to all resource types; only to new resources or to all new and existing resources). (14) Under a Targeted MOPR construct, what exemptions, if any, should be considered (e.g., self-supply, competitive entry exemptions)? Please explain. (15) For states that choose to achieve resource adequacy outside of the PJM capacity market, please describe any options (e.g., FRR, self-supply, etc.) that should be considered for availability to the states. a. Should FRR or other self-supply options be modified in any way to make them more useful to states that wish to reclaim authority for resource adequacy in order to meet state policies? (16) Should load serving entities be able to procure capacity outside of PJM’s capacity market such that PJM would only administer a residual capacity auction (i.e., an auction that removes demand procured outside the capacity market from the demand curve and supply curve would not include capacity procured outside of the capacity market) to procure the remaining capacity requirements? What rules should govern such a residual auction? Would a residual auction provide sufficient incentives for capacity to enter the PJM market when needed to ensure resource adequacy? Please explain. (17) Several panelists at the conference stated that removing the Expanded MOPR in PJM would not have any adverse impacts on resource adequacy and in turn reliability. Please explain whether you agree or disagree with this statement and why. (18) Are there differences among the expected short-term, intermediate term, and long-term effects of removing the Expanded MOPR on resource adequacy and in turn reliability? Please explain why or why not. (19) Is there a concern that merchant resources may fail to receive financing due to state supported resource entry in PJM? Please explain and provide supporting evidence if possible. Please also explain how this consideration bears on the Commission’s responsibilities under the Federal Power Act. 1 Calpine Corporation v. PJM Interconnection, L.L.C., 169 FERC ¶ 61,239, at P 70 (2019) (‘‘As to whether private, voluntary bilateral transactions might raise inappropriate subsidy concerns, we find that the record in the instant proceeding does not demonstrate a need to subject voluntary, arm’s length bilateral transactions to the MOPR at this time.’’) (footnote omitted). 2 For example, a buyer could contract with a seller outside of the PJM capacity market and direct the seller to submit an offer below the supplier’s cost (e.g., at zero) in the PJM capacity auction to lower the market clearing price. Such a strategy would lower the buyer’s total capacity procurement costs if the savings the buyer achieves from the lower market clearing price paid for the total quantity of capacity the buyer purchased in the PJM capacity market exceeds the losses (excess costs in this example) the buyer incurred from the out-ofmarket contract with the seller. PO 00000 Frm 00031 Fmt 4703 Sfmt 4703 E:\FR\FM\09APN1.SGM 09APN1 Federal Register / Vol. 86, No. 67 / Friday, April 9, 2021 / Notices a. Should PJM’s capacity market address this concern, and if so, how? Is there an option to address potential financing challenges by adjusting the parameters that establish the capacity market demand curve, such as changes to the net cost of new entry (Net CONE) estimate? For example, Net CONE estimates could be adjusted by reducing the expected economic life of the reference unit used to establish Net CONE, increasing the reference unit’s cost of capital to reflect higher risks, or through changes to the shape of the demand curve. b. Many state polices related to electric generation (e.g., renewable portfolio standards) are specified in statute and include timelines (often decades into the future) that investors can use to estimate the timing, type, and quantity of state supported resources entering PJM’s markets and potential market impacts. To what extent does the transparency of such state polices mitigate or reduce these risks to merchant resources? c. Would a capacity market with a Targeted MOPR provide a sufficient incentive for capacity to enter the PJM market when needed to ensure resource adequacy? (20) What changes are needed to ensure PJM’s energy and ancillary services markets send appropriate price signals and ensure sufficient incentives for investment? (21) What is FERC’s responsibility toward states in the PJM region that have chosen a state policy of not subsidizing their preferred resources in light of the competitive capacity market? (22) How urgent is the need to reconcile PJM’s capacity market rules and state policies? Could PJM or the Commission adopt a phased approach with short-term and long-term solutions? For example, could shortterm actions include eliminating the Expanded MOPR and replacing it with a Targeted MOPR? What long-term solutions are needed, if any? For further information, please contact individuals identified for each topic: Technical Information, David Rosner, Office of Energy Policy and Innovation, Federal Energy Regulatory Commission, 888 First Street NE, Washington, DC 20426, (202) 502– 8479, david.rosner@ferc.gov. Legal Information, Rebecca J. Michael, Office of the General Counsel, Federal Energy Regulatory Commission, 888 First Street NE, Washington, DC 20426, (202) 502–8776, rebecca.michael@ferc.gov. VerDate Sep<11>2014 17:45 Apr 08, 2021 Jkt 253001 18525 Dated: April 5, 2021. Kimberly D. Bose, Secretary. Dated: April 5, 2021. Kimberly D. Bose, Secretary. [FR Doc. 2021–07324 Filed 4–8–21; 8:45 am] [FR Doc. 2021–07322 Filed 4–8–21; 8:45 am] BILLING CODE 6717–01–P BILLING CODE 6717–01–P DEPARTMENT OF ENERGY DEPARTMENT OF ENERGY Federal Energy Regulatory Commission Federal Energy Regulatory Commission [Docket No. AD21–9–000] [Project No. 2570–033] The Office of Public Participation; Supplemental Notice of Workshop AEP Generation Resources, Inc.; Eagle Creek Racine Hydro, LLC; Notice of Application for Transfer of License and Soliciting Comments, Motions To Intervene, and Protests As announced in the Notice of Workshop issued in the abovereferenced proceeding on February 22, 2021, the Federal Energy Regulatory Commission (Commission) will convene a Commissioner-led workshop on Friday, April 16, 2021, from approximately 9:00 a.m. to 5:00 p.m. ET. The workshop will be held electronically. The purpose of this workshop is to provide interested parties with the opportunity to provide input to the Commission on the creation of the Office of Public Participation (OPP). In December 2020, Congress directed the Commission to provide a report, by June 25, 2021, detailing its progress towards establishing the OPP. Section 319 of the Federal Power Act directs the Commission to establish the OPP to ‘‘coordinate assistance to the public with respect to authorities exercised by the Commission,’’ including assistance to those seeking to intervene in Commission proceedings. (16 U.S.C. 825q–1). The agenda for the workshop is attached. The workshop will be open for the public to attend electronically and there is no fee for attendance. Information on the workshop will be posted on the Calendar of Events and the OPP Workshop on the Commission’s website, www.ferc.gov, prior to the event. The conference will be transcribed. The workshop will be accessible under section 508 of the Rehabilitation Act of 1973. For accessibility accommodations, please send an email to accessibility@ferc.gov or call toll free 1–866–208–3372 (voice) or 202–208– 8659 (TTY), or send a fax to 202–208– 2106 with the required accommodations. For more information about this workshop, please contact Stacey Steep of the Office of General Counsel at (202) 502–8148, or send an email to OPPWorkshop@ferc.gov. For logistical issues, contact Sarah McKinley, (202) 502–8368, sarah.mckinley@ferc.gov. PO 00000 Frm 00032 Fmt 4703 Sfmt 4703 On March 5, 2021, AEP Generation Resources, Inc. (transferor) and Eagle Creek Racine Hydro, LLC (transferee) filed jointly an application for the transfer of license of the Racine Hydroelectric Project No. 2570. The project is located at the U.S. Army Corps of Engineers’ (Corps) Racine Locks and Dam on the Ohio River near the Town of Racine in Meigs County, Ohio. The project occupies 23 acres of federal land administered by the Corps. The applicants seek Commission approval to transfer the license for the Racine Hydroelectric Project from the transferor to the transferee. Applicants Contact: For transferor, AEP Generation Resources, Inc.: Ms. Kimberly Ognisty, Winston & Strawn LLP, 1901 L Street NW, Washington, DC 20036, Phone: (202) 282–5217, Email: kognisty@winston.com and Mr. John C. Crespo, American Electric Power Corporation, 1 Riverside Plaza, Columbus, OH 43215, Phone: (614) 716– 3727, Email: jccrespo@aep.com. For transferee, Eagle Creek Racine Hydro, LLC: Mr. Joshua E. Adrian, Duncan Weinberg, Genzer & Pembroke, P.C., 1667 K Street NW, Suite 700, Washington, DC 20006, Phone: (202) 467–6370, Email: jea@dwgp.com. FERC Contact: Anumzziatta Purchiaroni, (202) 502–6191, Anumzziatta.purchiaroni@ferc.gov. Deadline for filing comments, motions to intervene, and protests: 30 days from the date that the Commission issues this notice. The Commission strongly encourages electronic filing. Please file comments, motions to intervene, and protests using the Commission’s eFiling system at http://www.ferc.gov/docsfiling/efiling.asp. Commenters can submit brief comments up to 6,000 characters, without prior registration, using the eComment system at http:// www.ferc.gov/docs-filing/ ecomment.asp. You must include your name and contact information at the end E:\FR\FM\09APN1.SGM 09APN1

Agencies

[Federal Register Volume 86, Number 67 (Friday, April 9, 2021)]
[Notices]
[Pages 18523-18525]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-07324]


-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. AD21-10-000]


Modernizing Electricity Market Design; Notice Inviting Post-
Technical Conference Comments

    On March 23, 2021, the Federal Energy Regulation Commission 
(Commission) convened a Commissioner-led technical conference to 
discuss the role of the capacity market constructs in PJM 
Interconnection, L.L.C. (PJM), ISO New England Inc., and New York 
Independent System Operator, Inc. in an environment where state 
policies increasingly affect resource entry and exit. The technical 
conference included the discussion on the implications of retaining the 
expanded minimum offer price rule (Expanded MOPR) in the PJM capacity 
market, as well as prospective alternative approaches that could 
replace PJM's Expanded MOPR.
    All interested persons are invited to file initial and reply post-
technical conference comments on the topics in Parts I and II below. 
Commenters may reference material previously filed in this docket, 
including the technical conference transcript, but are encouraged to 
avoid repetition or replication of previous material. Commenters need 
not answer all of the questions, but commenters are encouraged to 
organize responses using the numbering and order in the below 
questions. Commenters are encouraged to limit their responses to the 
questions identified below and not provide significant background or 
other material. Initial comments must be submitted on or before April 
26, 2021. Reply comments must be submitted on or before May 10, 2021. 
Initial comments should not exceed 25 pages and reply comments should 
not exceed 15 pages. PJM's initial and reply comments are not subject 
to these page limitations.

I. Comments on Supplemental Notice

    We are seeking comments on the topics discussed during the 
technical conference, including responses to the questions listed in 
the Supplemental Notice issued in this proceeding on

[[Page 18524]]

March 16, 2021, in accordance with the deadlines and other guidance 
above.

II. Comments on PJM's Capacity Market

    We are also interested in comments regarding PJM's capacity market, 
in accordance with the deadlines and other guidance above, as follows:

A. Existing PJM MOPR Implications

    (1) Have circumstances regarding the nature and scope of state 
actions to support specific resource types (e.g., new state 
legislation, new or revised state subsidies, new or revised standards 
such as increased renewable portfolio standards, etc.) changed in the 
PJM footprint since the establishment of the Reliability Pricing Model? 
If so, should the purpose and goals of the capacity market evolve in 
response to this change? Please explain.
    (2) Please explain how the expected quantity of state supported and 
non-state supported resources, by resource type, has changed since 
2018. Please provide the relevant dates of relevant legislation, 
executive actions, rulemakings, and/or other state actions. How is the 
Expanded MOPR likely to affect the entry of these resources? Will the 
expected impact of the Expanded MOPR change over time? Please explain.
    (3) Is there a particular type or quantity of state supported 
resources that are unlikely to clear PJM's capacity market as a result 
of PJM's Expanded MOPR, in the near term or in the future? If so, 
please provide examples.
    (4) Please explain whether and, if so, how PJM's Expanded MOPR will 
result in over-procurement of capacity, or ``surplus capacity'' (i.e., 
capacity in excess of the PJM Installed Reserve Margin), due to reasons 
other than the capacity market's sloped demand curve. To the extent the 
Expanded MOPR results in surplus capacity, including the delayed 
retirement of existing resources, what are the impacts on PJM's 
customers? What impact could such surplus capacity have on PJM's energy 
and ancillary services markets? How do any such impacts bear on the 
Commission's responsibility to ensure just and reasonable rates under 
the Federal Power Act?
    (5) Does PJM's Expanded MOPR affect states' willingness to remain 
in PJM's capacity market? Does the Expanded MOPR compel states to 
choose between relying on PJM's capacity market to meet their resource 
adequacy needs and achieving state policies? If so, how? Which states 
are relying on or are considering relying on PJM's Fixed Resource 
Requirement (FRR), rather than the PJM's capacity market, as a result 
of the Expanded MOPR and why?
    (6) Please explain whether the implementation of PJM's Expanded 
MOPR has led or may lead to unforeseen impacts, including those 
enumerated below:
    a. Several panelists at the conference noted the potential for 
greater use of the FRR construct as a result of the Expanded MOPR. 
Please explain any potential impacts or concerns from an increased 
reliance on PJM's FRR construct in this manner (e.g., adverse impacts 
on capacity prices in PJM in zones that remain in the market, the 
reduced ability to ensure resource adequacy, etc.).
    b. Does the Expanded MOPR create administrative burdens for PJM, 
capacity resource owners, or others? If so, please explain and include 
details regarding the difficulties encountered.
    c. Does the Expanded MOPR have any impact on the ability of 
resources to engage in private voluntary, bilateral transactions? \1\
---------------------------------------------------------------------------

    \1\ Calpine Corporation v. PJM Interconnection, L.L.C., 169 FERC 
] 61,239, at P 70 (2019) (``As to whether private, voluntary 
bilateral transactions might raise inappropriate subsidy concerns, 
we find that the record in the instant proceeding does not 
demonstrate a need to subject voluntary, arm's length bilateral 
transactions to the MOPR at this time.'') (footnote omitted).
---------------------------------------------------------------------------

    (7) What are the benefits of the Expanded MOPR? Please explain.
    (8) Is it appropriate for the Commission to apply a MOPR to address 
state actions intended to suppress capacity market prices? Please 
explain why or why not?

B. Potential Alternatives to Expanded MOPR in PJM

    (9) Should the Expanded MOPR be revised or eliminated? If so, what, 
if any, are any other changes to the PJM Tariff would be necessary or 
appropriate? Please explain fully.
    (10) If any changes are made to the MOPR rules, is it necessary or 
appropriate to combine those changes with reforms to ensure that 
capacity resources are properly accredited for their reliability value?
    (11) Please explain the timeframe in which a proposed replacement 
rate could be implemented to avoid delaying the December 2021 Base 
Residual Auction.
    (12) Should a MOPR designed to address only buyer-side market power 
(i.e., a Targeted MOPR) replace the Expanded MOPR? How should the 
Commission determine what constitutes a potential exercise of buyer-
side market power? \2\
---------------------------------------------------------------------------

    \2\ For example, a buyer could contract with a seller outside of 
the PJM capacity market and direct the seller to submit an offer 
below the supplier's cost (e.g., at zero) in the PJM capacity 
auction to lower the market clearing price. Such a strategy would 
lower the buyer's total capacity procurement costs if the savings 
the buyer achieves from the lower market clearing price paid for the 
total quantity of capacity the buyer purchased in the PJM capacity 
market exceeds the losses (excess costs in this example) the buyer 
incurred from the out-of-market contract with the seller.
---------------------------------------------------------------------------

    (13) Please explain to which resources a Targeted MOPR should apply 
(e.g., only to natural gas-fired resources or to all resource types; 
only to new resources or to all new and existing resources).
    (14) Under a Targeted MOPR construct, what exemptions, if any, 
should be considered (e.g., self-supply, competitive entry exemptions)? 
Please explain.
    (15) For states that choose to achieve resource adequacy outside of 
the PJM capacity market, please describe any options (e.g., FRR, self-
supply, etc.) that should be considered for availability to the states.
    a. Should FRR or other self-supply options be modified in any way 
to make them more useful to states that wish to reclaim authority for 
resource adequacy in order to meet state policies?
    (16) Should load serving entities be able to procure capacity 
outside of PJM's capacity market such that PJM would only administer a 
residual capacity auction (i.e., an auction that removes demand 
procured outside the capacity market from the demand curve and supply 
curve would not include capacity procured outside of the capacity 
market) to procure the remaining capacity requirements? What rules 
should govern such a residual auction? Would a residual auction provide 
sufficient incentives for capacity to enter the PJM market when needed 
to ensure resource adequacy? Please explain.
    (17) Several panelists at the conference stated that removing the 
Expanded MOPR in PJM would not have any adverse impacts on resource 
adequacy and in turn reliability. Please explain whether you agree or 
disagree with this statement and why.
    (18) Are there differences among the expected short-term, 
intermediate term, and long-term effects of removing the Expanded MOPR 
on resource adequacy and in turn reliability? Please explain why or why 
not.
    (19) Is there a concern that merchant resources may fail to receive 
financing due to state supported resource entry in PJM? Please explain 
and provide supporting evidence if possible. Please also explain how 
this consideration bears on the Commission's responsibilities under the 
Federal Power Act.

[[Page 18525]]

    a. Should PJM's capacity market address this concern, and if so, 
how? Is there an option to address potential financing challenges by 
adjusting the parameters that establish the capacity market demand 
curve, such as changes to the net cost of new entry (Net CONE) 
estimate? For example, Net CONE estimates could be adjusted by reducing 
the expected economic life of the reference unit used to establish Net 
CONE, increasing the reference unit's cost of capital to reflect higher 
risks, or through changes to the shape of the demand curve.
    b. Many state polices related to electric generation (e.g., 
renewable portfolio standards) are specified in statute and include 
timelines (often decades into the future) that investors can use to 
estimate the timing, type, and quantity of state supported resources 
entering PJM's markets and potential market impacts. To what extent 
does the transparency of such state polices mitigate or reduce these 
risks to merchant resources?
    c. Would a capacity market with a Targeted MOPR provide a 
sufficient incentive for capacity to enter the PJM market when needed 
to ensure resource adequacy?
    (20) What changes are needed to ensure PJM's energy and ancillary 
services markets send appropriate price signals and ensure sufficient 
incentives for investment?
    (21) What is FERC's responsibility toward states in the PJM region 
that have chosen a state policy of not subsidizing their preferred 
resources in light of the competitive capacity market?
    (22) How urgent is the need to reconcile PJM's capacity market 
rules and state policies? Could PJM or the Commission adopt a phased 
approach with short-term and long-term solutions? For example, could 
short-term actions include eliminating the Expanded MOPR and replacing 
it with a Targeted MOPR? What long-term solutions are needed, if any?
    For further information, please contact individuals identified for 
each topic:

Technical Information, David Rosner, Office of Energy Policy and 
Innovation, Federal Energy Regulatory Commission, 888 First Street NE, 
Washington, DC 20426, (202) 502-8479, [email protected].
Legal Information, Rebecca J. Michael, Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE, Washington, 
DC 20426, (202) 502-8776, [email protected].

    Dated: April 5, 2021.
Kimberly D. Bose,
Secretary.
[FR Doc. 2021-07324 Filed 4-8-21; 8:45 am]
BILLING CODE 6717-01-P