Pennsylvania HR 361: A Resolution directing the Joint State Government Commission to study the costs and benefits of continued membership in the PJM Interconnection.

Bill Text

PRIOR PRINTER'S NO. 2539 PRINTER'S NO. 3289
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE RESOLUTION
No. 361
Session of
2025
INTRODUCED BY MATZIE, STEELE, FRANKEL, PIELLI, HILL-EVANS,
HARKINS, HADDOCK, MALAGARI, SANCHEZ, NEILSON, RIVERA, CEPEDA-
FREYTIZ, DELLOSO, PARKER, GALLAGHER, DONAHUE, BOROWSKI,
CIRESI, KAUFFMAN, REICHARD, SCOTT, SHUSTERMAN AND SHAFFER,
OCTOBER 28, 2025
AS REPORTED FROM COMMITTEE ON CONSUMER PROTECTION, TECHNOLOGY
AND UTILITIES, HOUSE OF REPRESENTATIVES, AS AMENDED,
APRIL 28, 2026
A RESOLUTION
Directing the Joint State Government Commission to study the
costs and benefits of continued membership in the PJM
Interconnection.
WHEREAS, The PJM Interconnection (PJM) plays a crucial role
in the reliable and affordable operation of the electric grid
and the wholesale electricity market as the Regional
Transmission Organization (RTO) in the Mid-Atlantic Region; and
WHEREAS, PJM operates the transmission system across
Pennsylvania, 12 other states and the District of Columbia, with
approximately 65 million customers, and manages an energy
marketplace which establishes the energy and capacity prices for
Pennsylvania residential, commercial and industrial customers;
and
WHEREAS, Pennsylvania has been a part of PJM since 1927, when
the intent of its original members was to pool generation
resources for the economic benefit of its members and the
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public; and
WHEREAS, Resource adequacy by PJM has played a more
significant role for Pennsylvania since 1997, with the enactment
of the Electricity Generation Customer Choice and Competition
Act, which restructured the electric industry, removing
generation from jurisdiction under the Pennsylvania Public
Utility Commission; and
WHEREAS, Membership in PJM offered benefits such as enhanced
reliability and access to a broader electricity market, but also
potential impacts on electric rates and adequate generation
resources for this Commonwealth in the future; and
WHEREAS, Since joining PJM and through 2024, Pennsylvania
customers have enjoyed competitive energy prices and cost
savings from the PJM electricity market; and
WHEREAS, PJM conducts capacity auctions for the PJM planning
year that runs from June 1 to May 31 each year with the primary
objective of incentivizing power plant owners and operations to
develop, permit, construct and bring into operation new power
plants to meet the increasing electric demands of customers in
Pennsylvania and across PJM; and
WHEREAS, In July 2024, PJM conducted the capacity auction for
June 2025 through May 2026 planning year, which resulted in the
increase from $29.50 per megawatt (MW) day, for the period June
2024 through May 2025, to $270.35 per MW day, a 600% increase
from the prior year, effective June 2025 through May 2026, with
an estimated increase in prices paid by Pennsylvania customers
of $2.2 billion in capacity market payments to the power plant
owners in PJM; and
WHEREAS, As a result of this PJM capacity market cost
increase to Pennsylvania customers, Governor Shapiro, in
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December 2024, filed a complaint against PJM at the Federal
Energy Regulatory Commission, arguing that the capacity prices
were unjust and unreasonable; and
WHEREAS, In February 2025, Governor Shapiro and PJM entered
into a settlement agreement that created a floor price of $175
per MW day and a ceiling price of approximately $325 per MW day
for the next two capacity auctions of June 2026 through May 2027
and June 2027 through May 2028; and
WHEREAS, In July 2025, PJM conducted the capacity auction for
the June 2026 through May 2027 period and announced that the
prices cleared at the ceiling price of $329.92 per MW day, a 22%
increase from the prior year, increasing costs to Pennsylvania
customers by an estimated additional $538 million above the
estimated $2.2 billion increase from the current period; and
WHEREAS, But for the ceiling price cap negotiated by Governor
Shapiro, the price would have cleared at $388.57 per MW day and
cost Pennsylvania customers an estimated additional $595
million; and
WHEREAS, The cumulative estimated increase in capacity costs
across the past two auctions is approximately $4.9 billion; and
WHEREAS, In December 2025, PJM is scheduled to conduct the
next capacity auction for the June 2027 through May 2028 period,
which will be subject to the floor and ceiling prices estimated
to cost Pennsylvania customers between $1.2 billion at the floor
and $2.8 billion at the ceiling; and
WHEREAS, Compared to capacity prices in May 2025, by May
2028, Pennsylvania electric customers will have paid an
estimated additional $6.1 billion to $7.7 billion under the PJM
capacity market; therefore be it
RESOLVED, That the House of Representatives direct the Joint
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State Government Commission