The latest PJM capacity auction cleared at the maximum allowed price—$333 per megawatt-day—and still came up short. Even at the price cap, the market could not buy enough power to meet PJM’s own reliability standard.
Capacity auctions exist for one reason: to make sure the lights stay on when the system is under real stress. Not on a mild spring afternoon. On the worst day of the year—when demand peaks, equipment is strained, and weather is working against you. This auction tested that standard and found the system wanting.
This did not happen overnight. Electric demand has been climbing for years. Data centers multiplied. Electrification mandates piled new load onto the grid. Population shifts changed where and when power is used. Utilities, regulators, and planners saw it coming. The forecasts were published. The warnings were filed. No one was caught by surprise.
Supply, meanwhile, lagged badly.
New dispatchable power plants take years to permit, finance, and build. Those timelines grew longer, not shorter. Projects bogged down in regulatory reviews. Lawsuits became routine. Interconnection queues stretched out for years. At the same time, existing power plants—coal, gas, nuclear—were pushed into early retirement. The math stopped working.
Capacity markets do not reward good intentions. They pay for performance when things go wrong. Power that runs when the grid is under stress earns full value. Power that depends on weather does not, because weather does not take orders. Batteries help, but only for so long. New plants cannot appear on command.
For decades, coal, natural gas, and nuclear plants carried the system. They ran day and night. They showed up during heat waves and cold snaps. They kept reserve margins healthy and prices stable. Policy choices accelerated their exit before replacements were ready.
The auction simply counted what was left.
By the time bidding hit the price cap, PJM still had not secured enough dependable capacity. That is not a market failure. That is a supply failure. You cannot buy power plants that no longer exist, no matter how high the bid.
The cap did what it was designed to do—it limited how much customers would be charged. It did not create megawatts out of thin air. Raising the cap would have raised prices without fixing the shortage. The damage was done years earlier.
Now the bill comes due.
Capacity costs from this auction will be baked into electric rates for years. Households will see higher monthly bills regardless of fuel prices or weather. Businesses will face higher fixed costs that squeeze margins and weaken competitiveness. Manufacturers will factor those costs into decisions about where to invest—or whether to invest at all. This is the real-world cost of pretending supply does not matter.
Political rhetoric about protecting working families collapses when electricity becomes scarcer and more expensive. Power prices respond to physics and infrastructure, not slogans. Shrinking reserve margins and fewer dependable plants mean higher costs. Ratepayers pay them every time.
For years, planners assumed new capacity would show up somehow, even as rules made building it harder. Retirements accelerated. Replacements stalled. Hope replaced hard planning. This auction priced that gamble.
PJM followed its rules. The market worked as designed. It revealed the condition of the system policymakers handed to it. Demand is still growing. Data centers are still being built. Electrification policies are still adding load. Peak demand forecasts are still rising.
Supply constraints remain. Permits still take years. Interconnection queues are still backed up. Financing remains uncertain. More retirements are already scheduled. There is no near-term surge of dependable capacity waiting in the wings. Under those conditions, higher capacity prices are not a surprise. They are inevitable.
Reliability is built, not declared. Power plants and transmission lines take time. Skilled workers and fuel supply chains matter. Decisions made today show up in auctions years later. Reserve margins are the system’s shock absorber—and they are thinning.
This auction measured the result.
Unless policy changes to allow dependable power to be built and kept online, the pattern will continue. Capacity will tighten. Prices will rise. Customers will pay.
The auction sent a message in megawatts and dollars. The Washington left may try to spin it, but the grid will not.
Terry L. Headley, MBA, is founder of The Hedley Company – Communications & Research for Energy. A former journalist, he has more than 25 years of experience analyzing electric power markets, fuel supply, and energy policy, with a focus on grid reliability and the real-world cost impacts of energy decisions on households, businesses, and regional economies.
This article was originally published by RealClearEnergy and made available via RealClearWire.
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Sounds like something that I should hear about on the CBS evening news.
Ha…ha…ha…ha…ha…ha…ha…ha!
“A TV transmitter’s electricity use varies wildly, up to hundreds of kilowatts (kW) for major stations”
Why would the demand vary?
They are typically transmitting at a fixed energy level. As an example, FM radio is the same amplitude wave, just the frequency changes.
If it is the same amplitude, (feeding into the same antenna), then surely the power is the same.
AM was different but there aren’t many of them left now.
I read that as a small station uses less and a big station uses more.
re: “AM was different but there aren’t many of them left now.”
Many, nearly all now, stations use something called MDCL, for AM Modulation-Dependent Carrier Level also termed DCC for Dynamic carrier control. This technology offers a way for AM broadcasters to reduce their electrical power consumption with a minimum of impact on the quality of the audio signal received by listeners. The effect is to keep peak transmitter power level at/near the nominal rated carrier power level – if one has capable equipment (a receiver with a suitable narrow-band IF filter) one can see an actual decrease in carrier level WITH program (voice or music) content (i.e. when the so-termed carrier is modulated).
This is obvious with one local broadcaster in my area, WBAP, nominally a 50 kW “clear channel” broadcast station … previous to using MDCL modulation peaks resulted in a 4x power increase to 200 kW on positive modulation peaks (double the envelope seen on an oscilloscope display) and an attendant increase in AC mains power consumption. If one listens closely one can also hear the reduction of SNR (signal to noise ratio) with MDCL when program content (audio) appears, as the carrier level varies (which most receivers) use to set or control AGC (Automatic Gain Control, overall radio gain) value used to control the gain from the front end stage through to the IF (Intermediate Frequency) amplifying stages (in a ‘superhet’ or superheterodyne radio architecture design).
Info from an equipment manufacturer: https://www.nautel.com/products/innovations/efficiency/power-saving-mdcl/
Standards Committee: https://www.nrscstandards.org/standards-and-guidelines/documents/archive/nrsc-g101.pdf
(Full disclosure: “1st Class” FCC lic holder since ’75)
A bit of radio broadcast history about a 500,000 watt (500 kW) AM radio station.
https://www.neh.gov/humanities/2015/mayjune/feature/in-the-1930s-radio-station-wlw-in-ohio-was-americas-one-and-only-sup
(They don’t broadcast them like they used to!)
hmmm… just curious but how much more does a TV transmitter use than a radio station transmitter?
Quite a bit. The bandwidth needed for video is much greater than the bandwidth needed for audio, at least during the age of analog transmitters.
In the digital age, the bandwidth varies by the encoding and the HDTV and VHDTV use more bandwidth. Encoded audio usually is a 16 kbps but not unusual to go to 32 kbps which requires less transmitting power (lower frequency and bandwidth) that the multi-mega bps for digital TV.
Nope, nuthin’ about it on CBS today. Maybe tomorrow? Ha…ha…ha…ha…ha!
Did you check NPR and CNN?
Reality requires Carbon-based fuels, nuclear, and hydro. Propaganda pushes wind and solar. The former suffers because of the latter. Still, the reliable facilities are needed. Thus, we pay for two systems when only one is needed.
Check the contribution of wind in the Oregon and Washington region. Saturday Noon (12/27/25), wind {green in the chart} has been bumping along the bottom. In the chart, the BPA labels nuclear as the color Cobalt, but uses green in the pie-chart at the top. Looks like Pantone “Jam” to me.
https://transmission.bpa.gov/Business/Operations/Wind/baltwg.aspx
PJM capacity auction? We should task PJM to invent light bulbs that run on capacity, not on power.
Um what is the PJM?
Orange here:
map-of-regional-transmission-operators-of-us-electric-grid.png (800×800)
The “PJM” name originated from its founding states: Pennsylvania, Jersey (New Jersey), and Maryland. Its current territory also includes:
Delaware, Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, Virginia, West Virginia, and the District of Columbia.
PJM Interconnection is a regional transmission organization (RTO) that coordinates the movement of wholesale electricity in all or parts of 13 states and the District of Columbia. As the largest power grid operator in the United States, it ensures reliability for approximately 65 million people.
Per Gemini
Well, it sounds like it’s a fizzer on that “ensures reliability” bit.
This is what we get when politicians try to power society with windmills and solar: Higher prices and Blackout warnings.
“The Washington left may try to spin it”
Would that be Mr Trump?
Trump is right. What is not right is what’s left.
And there will be nothing left,
because
You’ll own nothing
and pretend to love it
(in case you don’t, your daily calorie access will go to 0)
Translation:
Others will be owning what you used to own.
(They’ll be the ones living in Farm House.)
“Oh, good one, centurion”
(h/t “Life Of Brian”)
So Nick, you know how Godwin’s Law https://en.wikipedia.org/wiki/Godwin's_law applies to people who introduce a reference to Hitler into a discussion that warrants no mention of Hitler other than as a way of avoiding the subject at hand, it’s becoming unavoidably apparent that people who introduce a reference to Trump into a discussion that warrants no mention of Trump is also a way of avoiding the subject at hand.
“that warrants no mention of Trump”
So who is actually in charge in Washington?
As always, it’s the ones with the deepest pockets are the people who pull the strings; we only get to see the front man.
I think it was established in January 2021 that the speaker in the congress (Nancy Pelosi back then) is in charge of Washing DC.
It was she who was petitioned to authorize the attendance of the National Guard there, but called the shots that they could not be used.
So I guess that’s a solid precedent in determining who is in charge of Washington DC?
I mean, matters don’t get more serious for a “leader” than having the responsibility to suppress an “insurrection” than that, do they?
So you’re saying the Speaker of the House is in charge? I bet that’s news to DJT, who really did call in the National Guard.
But who is this Washington leftist who is being held responsible for the outcome?
He was over-ruled by Nancy, Nick.
She clearly called the shots with all the Washington law enforcement officials, including the Democrat mayor at the time.
’nuff said.
But I guess we have to rely on you to inform us all as to –
“who is this Washington leftist who is being held responsible for the outcome”.
After all, you’re the member of standing in leftism here.
Read out Constitution, Nick. The Legislative Branch is in charge. The Executive Branch administers things. However, the Congress has delegated most of its authority to the permanent bureaucracy. That way, they can claim that they aren’t responsible for the mess.
You still haven’t explain the headline role of “the Washington Left Can’t Spin Away”
Are not Republicans in control of all the institutions you mention? Who is this “Washington Left “?
Republicans are not in charge of the Leftwing Propaganda Media.
They and their Radical Democrat fellow travelers are the “Washington Left” being referred to.
The Speaker of the House is in charge of the Capital building security. She overrode the requests for National Guards due to “optics.”
DJT had authorized deployment of National Guard days in advance. Unfortunately the acting Sec.Def. thought it was a joke and did not act on it.
D.C. government petitioned the Senate and House Sgts at Arms for Nat. Guardsmen. The answer? No. The reason? Optics.
Anyone else notice how those on the left, actually believe that the president is supposed to be a dictator.
As long as it is their pick doing the dictating.
Those on the Left are obviously delusional.
Which makes them dangerous to regular people.
Nick,
You clearly don’t understand how our Federated System is structured. Don’t worry – the Progressives don’t either. As pointed out above, with a pretty, colorful map, electricity supply is handled by groups of states, not the Government in Washington. Therefore, any attempt to involve Trump in this issue, or Washington, demonstrates ignorance. Come on, Nick, you are smarter than that.
Introducing a reference to Trump or Hitler indicates the person can’t discuss ideas.
“Great minds discuss ideas; average minds discuss events; small minds discuss people.”
It was Headley who blamed “leftists in Washington”. Why is it not OK to point out who is actually supposed to be in charge there, and doing something about it?
See my comment above and read the Constitution.
History shows that strong, charismatic leaders of this world, such as Trump, Hitler, Putin, & Napoleon, have ideas;
Those ideas produce events;
Those events result in misery for millions of people.
So you are comparing Trump to Hitler, too?
Read what I posted.
I mentioned Trump, Hitler, Putin, & Napoleon, but there have been many others … here are a few, in no particular order ...
Martin Luther King Jr., Winston Churchill, Fidel Castro, Nelson Mandela, Barack Obama, Sitting Bull, John F. Kennedy, Stalin, Lloyd George, de Gaulle, Lincoln, the list is a long one.
TDS?
No, just general wide-ranging derangement…
A wide deranger.
But certainly not a Lone Deranger !! 🙂
“TDS?”
No, just a reminder that Mr Trump is in charge in Washington, not these imagined “leftists”. And he is the one supposed to fix it.
There is one heck of a lot of far-leftist mess to clean up first !!
And there are a lot of far-leftist scum slowing the recovery process down.
When someone’s first reaction is “Trump”, no matter what the subject, it suggests a deeper obsession.
As for who is in charge, that is a matter of some debate. In general, the bankers and their pocket puppets have held the reins for a century and more.
It is the Left, and often yourself, who try to spin the glories of alternatives to energy despite its all too apparent shortcomings. Mr. Trump is more the traditional modality guy.
There 4 major power centers in DC, President, Congress, Courts and Bureaucracy.
There are others, such as the media, who’s influence varies based on many factors.
Funny how the left actually wants the president to be the kind of dictator that they keep accusing Trump of being.
Yeah, if you want to talk about American Dictators you should start with Obama and Biden.
They are the ones who used the power of the federal government to try to destroy their political opponents. This is what dictators do.
Obama and Biden are both Traitors to their country. They should both be in jail.
Wrong.
Hell, not even wrong
You sound like Hakim Jeffries, Nick.
He says Republicans have complete control of the White House and the U.S. House and U.S.Senate.
The Lie he tells is that Republican do not have complete control in the U.S. Senate as 60 votes are required and Republicans don’t have 60 votes.
So Republicans do not have complete control in Washington D C.
Not yet, anyway. Come back in about a year and see how things look.
DJT is not “in charge in Washington.”
He is head of the Administrative Branch of the government but under Constitutional checks and balances with the Judiciary and the Legislative branches having defined roles and on an equal footing.
Nick is conflating (purposefully?) “Washington”, the location of the main buildings of Government of United States of America, with the city called Washington DC.
DC is the District of Columbia in the Constitution of the US and it the Capitol. It was later named after Washington. It is not a State or a part of any state. Intentionally so, so no individual state would control it.
Governance of the city is in the hands of Congress.
Nancy Pelosi, as Speaker of the House is the one who refused the National Guard that day.
They might have interfered with what BLM’s and the other “observers” in the crowd were doing that day.
“TDS?” To me as a chemist, that means Total Dissolved Solids.
What? Never mind.
Context is everything. In this case, the solvent is authority.
😎
I have an IRA.
That doesn’t mean I want Ireland to take over Northern Ireland.
(Context. I’m retired.)
It’s interesting that back in the day that I was in graduate school, studying various forms of energy conversion, utilities were in control of their power development, and they build various forms of generation for base load, shoulder load, and peak load. They had contracts for delivery from other power generators, and they monitored and were able to deliver power to their customers 99.99+% of the time. Then people, mostly those without any scientific training, got excited about CO2, a gas that is essential for life on Earth, a gas that has been sequestered away geologically, and is now a much smaller fraction of the atmosphere than it was when life began on Earth. These people weren’t worried about CO2 being too low, the real problem, but they were worried about it being too high! They began to push for the removal of very reliable fossil fuel plants (they had already screwed up nuclear power) and they wanted those to be replaced with unreliable combinations of mammoth low density energy gathering structures suitable for medieval people, not modern society, and electric reliability went to crap. That’s the history of power management over the last 50 years in a paragraph.
Aided and abetted by the State Public Utility Commissions.
Before the Three Mile Island incident and Chernobyl disaster, nuclear growth and improving efficiency were on a path to providing more than half of today’s U.S. electric energy. Then the hair-on-fire environmentalists took an axe to it and nuclear flatlined. Had this not occurred, U.S. greenhouse gas emissions (as if I care) could today easily be at 1970s levels. More broadly, nuclear development worldwide could be in a very different place.
So, IF one were to accept the CAGW premise (which I don’t), one could correctly suggest that today’s environmentalists and their predecessors are the proximal cause of the panic that has led to today’s grid destabilization and foolhardy push for “ruinables.”
re: “Would that be Mr Trump?”
Abject stupidity on display by the one posting same …
Since when has Trump been considered part of the “left?”
Let us lead you by the hand through this.
The full quote:
The auction sent a message in megawatts and dollars. The Washington left may try to spin it, but the grid will not.
The first part of the quote involved the word “message.”
The last part of the quote involved spinning it (the message).
Politicians and media are infamous for spinning messages to create something where there was nothing to begin with or to reverse the message in favor of what they want presented to the public. You know this.
You also know that in US politics, “left” is democrat while “right” is republican.
You also know that much of the main stream media is aligned with the “left.”
Get it now?
PJM? Perhaps from Pennsylvania, new Jersey, and Maryland. At any rate, “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.”
Note, Nick, that neither the Federal Government nor the POTUS are mentioned.
So who are the “Washington left” and why are they responsible?
Nick, the answer is environmentalists, Marxists, Beltway bandits, so-called elites, mainstream media and grifters who infest Washington, DC and have fueled and funded the climate change and “ruinables” frenzy. This is a much bigger culture and governance war than merely how we obtain our energy supplies. The Marxist/socialist march through the institutions thought they had victory in their grasp. Then a brash and often hilarious real estate developer from New York whose name begins with “T” ignited the fires of resistance.
You wouldn’t recognize this because you appear to be one of them.
Nick, please read more carefully. The author wrote “The Washington left may try to spin it“, not “the Washington left is responsible”. A shade of meaning that does not directly assign blame, ( although I personally believe that it is warranted) but just asks how bureaucrats and elected officials of the left would respond to this issue, if asked.
When you nitpick, please nitpick actual issues.
The Washington Left are the fools in Congress pushing subsidies for unreliables while pressuring to shut down reliable fossil fuel power plants. Even someone like you should be able to figure that out. https://robertbryce.substack.com/p/heres-the-real-hockey-stick?r=2vnfr&utm_source=substack&utm_medium=email
Remember that the advocates for intermittent energy have a solution for the absence of solar power production at night. And it is obvious. You need more solar panels.
We are talking about advocates for intermittent energy who say that power prices are getting higher because dispatchable energy is unreliable whereas intermittent energy is not.
Can’t spin away? Wait for it!
The solution to this stinking mess couldn’t be simpler. We know why we are where we are, we know how to fix it. Our government has been working with, supporting, financing, praising and joined at the hip with organizations who are opposed to fossil fuel and nuclear power. I don’t care why they are opposed to them it doesn’t matter. The point is they will do anything to block fossil fuel and nuclear. The elephant in the room is that there is no substitute, there are wasteful, expensive, inefficient, intermittent and ugly bandaids that can’t stand on their own and can’t produce what we need. The number one step forward is to admit our government has failed us, knew they were going to fail us and did it anyway. That is criminal. We know how to build clean, safe, dependable generators that can produce all the power we need when we need it. Choose one or two coal systems, gas systems and nuclear systems we know can produce the power we need in the manner we want. We also know where those systems can be built and operated in the manner necessary. Put out bids stating we have these properties approved, these systems approved and all permitting is included. Anyone interfering with this legal operation will immediately be arrested and charged with the appropriate crime. The only thing we have standing in our way is dishonest, crappy government.
Unless this article was intended for WUWT super-electro nerds, it should have had an “in English please” intro. I had no clue what PJM was, and after someone answered Terry’s question, I still had a hard time following it. After the third reading, it appears to be telling me that a large electricity consortium could not buy enough reserve power to ensure its customers will not suffer blackouts. It does not explain why there is a $333 price cap, either. It goes on to explain that there is not enough power due to stupid people limiting oil, LNG and nuclear power production. THAT much I figured out.
A little research can go a long way. I also wondered about the cap.
The PJM price cap was set in order to settle a lawsuit by Pennsylvania governor Shapiro against them. Shapiro ‘feared’ (aka ‘knew’) that otherwise the price would be about $500. So the cap did what caps always do—guarantee a market supply shortage.
Shapiro won’t look smart next year when the inevitable rolling blackouts arise from the PJM shortfall in guaranteed electricity supply. And Shapiro is insisting on 30% renewables in Pennsylvania’s electricity mix by 2030, up from 8% now—his campaign pledge is called the “Lightening Plan” after Ben Franklin’s famous kite experiment showing that lightning was electricity. Won’t end well for PA.
Blue State governors are a bunch of fools.
i can’t think of one of them that I would be comfortable with. They all seem to be delusional to one degree or another. Not ready for Prime Time. None of them.
Still pushing windmills. It doesn’t get much more delusional than that.
You have gotten the essence right. PJM acts as a consortium to balance electricity distribution across the states who have joined the consortium. Many of those states have simultaneously pursued “green” power supply solutions (wind, solar for power generation, rooftop solar (with subsidies to those who install systems, including sale of excess power to the grid), and hydro (a major portion of which is imported from Canada. They have simultaneously decommissioned nuclear and coal plants before their useful lifetime, and have limited adoption of new, efficient gas turbines while promoting electrification for heating, industry, and home appliances. To that, add electricity for data centers, which is increasing demand sharply.
When major cold or hot spells are accompanied by clouds and either high or low winds, production of “renewable” power crashes; and the difference is supplied (up to a point) by backup gas or coal generation, which is very expensive. Therefore, the auction for spot power price surges, and coal and gas are blamed for the failures caused by the unreliability of “renewables.” As the proportion of “renewable” power rises, the system risk increases. Having adequate backup power essentially means having a duplicate power system that sits idle 90%+ of the time, and regulators have simply been unwilling to properly plan for the required contingency which has enormous cost. Battery backup is even more costly.
I might add, your phrase “backup gas or coal generation, which is very expensive” could be misconstrued, especially by fanatics who persist in saying ruinables are cheaper. The “expensive” is linked to the fact of the “duplicate power system that sits idle 90%+ of the time.” Toss ruinables aside, and dispatchable fossil fuel and nuclear would result in a far cheaper AND more reliable system.
These no-frills statements of inalienable facts should be carried as front-page editorials by every city news outlet around the world that considers itself a serious “journal of record”.
Most of our news outlets are busy trying to hide such information.
If it makes Democrats look bad, about 90 percent of news outlets will not cover it.
Pennsylvania-New Jersey-Maryland Interconnection
https://en.wikipedia.org/wiki/PJM_Interconnection
Who knew
A lot of us knew.
What is PJM? You shouldn’t assume people will know that.
The standard is to spell out an acronym the first time it is used.
Some people do not adhere to the standard, thus sowing confusion.
I was going to say something similar.
Some are so familiar with the acronym that they forget others are not and assume they know or will figure it out from the post.
Back in the day I’d see “LOL” often. I quickly figured out that they weren’t saying “Lots of Love” as the term became more common knowledge. But less common acronyms receive a “WTF” response.) 😎
Do you know any other Huberts? Writers that assume everyone is in the same bubble they are with their text displaying hubris.
I think this is the 3rd time I have posted a link to the map that shows the location of the Pennsylvania-New Jersey-Maryland (PJM) Interconnection.
Huberts had High School English classes, as did most of us. The contents didn’t take.
In strict use of the language, a megaWatt day is a unit of energy, not power. A megaWatt is a unit of power, even in the utilities business.
This reads like reality is about to bit ideology in the derriere.
Typeo: about to bite…
There is a logical solution to this, which means no one in government will consider it. Propose tracks of land on which AI data centers can be built if it includes its own co-located clean coal or NG plant, with no permitting required. The plant would be private, not subject to public service commission regulations. The only requirements are that up to 10% of the power generated must be sold to the PJM at their average wholesale costs, and the plant must be operational by 2030.
If you get government out of the way, people can accomplish great things very quickly.
The Googles and Metas of the world realize how much high priced spot power they will be able to sell down the road when they power their data centers. It will pay for the build outs over time, they just aren’t saying so as it would obviate the virtue signaling over the minimal levels of unreliables they are touting in the builds to appease the addled.
If only there was a field of study dedicated to predicting this outcome. It could be taught at universities and our leaders could learn from it before making suicidal policy.