Throughout the Northeast temperatures are expected to be extremely hot and humid this week, especially today, August 11th, and tomorrow, August 12th. It is expected that usage may exceed system peaks between the hours of 2-6pm EST on these days. If so, it is likely one of these days will set the system peak in NY, and one of the 5 peaks for PJM. This could set the Capacity Peak Load Contribution, or cap tag (as well as the Network Service Peak Load, or NITS tag) for your customers accounts starting June 1st of next year 2022.
We recommend talking to your customers about reducing electricity usage during these hours in order to reduce future capacity costs. As always, if you would like more information surrounding peak days and capacity, don’t hesitate to reach out to your Channel Partner Manager.
Regulatory report
EXELON ILLINOIS NUCLEAR PLANTS
On Exelon’s Aug. 4 second-quarter earnings call CEO Christopher Crane reported that Exelon had reached agreement with the Illinois governors’ office on terms that would provide support to Exelon’s Byron and Dresden nuclear plants, but that the Illinois lawmakers are at an impasse on the specific legislation. Crane said that there had been no progress on the legislation since the legislature adjourned in June. Without financial subsidies, Exelon is committed to shutting down the 2346MW Byron and the 1805 MW Dresden nuclear plants in September and November respectively. If these plants are retired later this year, it will have a bullish impact on energy and capacity prices in PJM.
Exelon also noted progress at the federal level to support nuclear plants, but any federal legislation would probably be too late for Byron and Dresden. An infrastructure bill recently unveiled in the US Senate is proposing a four year credit program for nuclear units in merchant power markets at risk of closure. There has also been a federal proposal for a production tax credit for existing nuclear plants.
REVISED NEW JERSEY SOLAR PROGRAM
On July 28, the New Jersey Board of Public Utilities (“NJBPU”) approved the program that will replace New Jersey’s Solar Renewable Energy Credit (“SREC1”) program.
The program known as the Successor Solar Inventive Program (“SuSI”, aka “SREC2”), will provide new incentives for solar development aimed at helping meet New Jersey’s goal if 100% clean energy by 2050. SREC2 will take effect on August 28 and will consist of two parts:
·A fixed administratively determined incentive payment for net metered solar projects of 5 MW or less, including community solar projects. The incentive value will vary based on project type and size and will be guaranteed for a term of 15 years. ·For solar projects larger than 5MW, New Jersey will conduct competitive solicitations similar to the offshore wind solicitations that the state has been conducting. The NJBPU expects the first such competitive solicitation to be conducted in early-to-mid 2022. These solicitations are expected to result in a long term contract for the winning project.
Ultimately, the cost of the SREC2 program will be assessed to retail electricity suppliers who will pass the costs onto customers.The NJBPU was required by New Jersey’s Clean Energy Act of 2018 to adopt regulations to replace the SREC program and develop a successor program.