Duqesne Light Company wants to sever ties with the PJM Interconnection regional transmission organization (RTO). Duquesne cites the increased capacity costs resulting from PJM’s implementation of the new reliability pricing model (RPM) for capacity sales, and is asking FERC to allow it to withdraw before PJM’s next capacity auction that will cover 2009 deliveries. PJM responded that it is too late to exclude Duquesne from that auction, and that numerous questions must be resolved, including how Duquesne would resolve it reliability requirements. A number of others have likewise objected to Duquesne’s precipitous withdrawal.
Duquesne has stated it intends to join the Midwest ISO, which it already borders from its location in
While utility membership in organized markets is voluntary, it is clear that withdrawals raise vexing issues of allocating costs to a shrunken customer base as well as long-term planning. With the complex RPM market finally in operation, market participants are already being forced to examine a new twist, the impact of a utility’s withdrawal on capacity procurement and reliability.