ER26-3380-000 · 2026-09-25 · Monitoring Analytics, LLC

Answer and Motion for Leave to Answer of the Independent Market Monitor for PJM Interconnection, L.L.C. to the Answer of PJM Interconnection, L.L.C. filed on 09/10/2026

UNITED STATES OF AMERICA 
BEFORE THE 
FEDERAL ENERGY REGULATORY COMMISSION 
 
PJM Interconnection, L.L.C. 
) 
) 
) 
 
Docket No. ER26-3380-000 
ANSWER AND MOTION FOR LEAVE TO ANSWER 
OF THE INDEPENDENT MARKET MONITOR FOR PJM 
Pursuant to Rules 212 and 213 of the Commission’s Rules and Regulations,1 
Monitoring Analytics, LLC, acting in its capacity as the Independent Market Monitor 
(“Market Monitor”) for PJM Interconnection, L.L.C. (“PJM”),2 submits this answer to, and 
moves for leave to answer, the answer submitted by PJM on September 10, 2026 (“September 
10th Answer”). 
The proceeding concerns the filing submitted by PJM Interconnection, L.L.C. (“PJM”) 
on July 31, 2026, proposing (at 1) “to establish the Reliability Backstop Procurement 
(“RBP”)—a one-time procurement of new capacity to address resource adequacy challenges 
in the PJM Region arising from insufficient commitments of capacity in the 2027/2028 and 
2028/2029 Reliability Pricing Model (“RPM”) Auctions, primarily driven by the 
unprecedented addition of large loads, most notably data centers” (“RBP Filing”).  
Despite the clearly stated public policy goals of elected officials, PJM’s stated purpose 
is not to assign the costs and risks of data centers to data centers. PJM’s stated purpose is not 
to protect other PJM customers from paying the costs and bearing the risks caused by data 
 
1 
18 CFR §§ 385.212 & 385.213 (2025). 
2 
Capitalized terms used herein and not otherwise defined have the meaning used in the PJM Open 
Access Transmission Tariff (“OATT”), the PJM Operating Agreement (“OA”) or the PJM Reliability 
Assurance Agreement (“RAA”).

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centers. The shortfall identified in the RBP Filing is a result solely of data center demand.3 
PJM’s approach will continue to impose data center costs on other customers. PJM fails to 
correctly identify the source of the capacity market and reliability problem. PJM fails to 
correctly identify the appropriate solution to the problem. As a result of the incorrect framing 
of the problem, the details of the RBP Filing are largely irrelevant. The details are about 
implementing a design that cannot achieve the correct objective of ensuring that data centers 
bear their own costs. The significant issues with the design details further reveal the flaws 
within PJM’s approach. 
PJM actually denies the fact that the shortfall faced by PJM is the result of data center 
load. PJM states (September 10th Answer at 64): “It is fallacious to suggest that a just and 
reasonable cost allocation approach must either identify specific loads (which are not FPA-
jurisdictional actors) and not the LSEs serving those loads or be limited to one type of load 
when the resource adequacy shortfall is caused by all types of loads that comprise the subject 
Load Adjustments” [emphasis in original].) 
The underlying theme and narrative of PJM’s RBP and IRAS Filings is that data center 
load is just load and the normal PJM capacity market and energy market mechanisms can 
handle the impact of data center load. PJM even goes a step beyond and incorrectly asserts 
that the identified shortfall is a result of all types of loads. In a word, PJM asserts that it is just 
supply and demand.4 PJM fails to recognize that the massive influx of data center load 
requires a paradigm shift in thinking about capacity. PJM fails to recognize that the massive 
influx of data centers requires a policy decision. That policy decision cannot reasonably fall 
back on simple high school economic nostrums. The policy instruction from a wide range of 
sources, including the elected representatives of the 67 million residents in PJM’s market area, 
 
3  
See Monitoring Analytics, LLC “Analysis of the 2027/2028 RPM Base Residual Auction – Part A,” 
(January 5, 2026). 
4  
See Proposal of PJM Interconnection, L.L.C. to Establish Interim Resource Adequacy Service and a 
Large Load Registry to Address System Reliability, Docket No. ER26-3515-000 (2026) (“IRAS Filing”).

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is clear. Data centers should pay for their own costs. A significant part of data center costs is 
the cost of the capacity required to serve them. PJM’s proposals fail to conform to that policy 
instruction. 
PJM attempts to use its current capacity cost allocation mechanism for the obligations 
that result from the RBP with EDCs/LSEs at the center and in which EDCs/LSEs receive an 
allocation of capacity costs from PJM and then allocate those costs to customers on a peak 
load basis. The current cost allocation process is clearly not adequate to address the 
assignment of data center costs to data centers. Rather than directly addressing the problem, 
PJM’s proposal would push the issue to the states by suggesting that states can create 
allocation rules that the EDCs/LSEs must follow. 
The September 10th Answer fails to address these underlying issues primarily by 
ignoring the real policy issue and focusing on narrow technical issues of how to implement 
the misguided RBP approach. 
On August 21, 2026, the Market Monitor submitted a protest demonstrating that the 
RBP Filing has not been supported as just and reasonable. The Market Monitor’s protest also 
demonstrated that the RBP Filing is unjust and unreasonable, and that attempting to 
implement it will severely damage PJM markets, impose data center costs on other customers 
as an intended consequence, create unintended consequences, and compound that damage 
for a period of 15 years. The Market Monitor concluded that, for all these reasons, the RBP 
Filing should be rejected. 
The RBP Filing and PJM’s September 10th Answer would continue to impose the costs 
of data center development on other customers. The RBP Filing and PJM’s September 10th 
Answer would continue to add to the $29.4 billion of capacity market costs that have resulted 
from the inclusion of data centers and PJM’s inaction to date by leaving 20,539.7 MW of data

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center load in the 2029/2030 BRA to be run in December 2026.5 6 While appearing to recognize 
that data center load is the source of the reliability issues facing PJM, PJM’s actual proposal 
would impose the costs and risks of the proposed RBP solution on other customers. The 
shortfall identified by PJM is entirely the result of existing and forecast data center load, yet 
PJM has failed to verify the underlying details of the forecast and refuses to reduce the 
forecast, and therefore the shortfall, based on known changes to data center plans. The costs 
of addressing the shortfall within the RBP approach are inflated as a result of PJM’s failure 
to include any market power mitigation rules, failure to use a single clearing price auction 
and the creation of crushing collateral requirements for EDCs/LSEs and their customers. 
The September 10th Answer entirely fails to address the most fundamental issues 
raised in the Market Monitor’s protest. The central error in the RBP Filing was not addressed 
in the September 10th Answer. PJM assigns the responsibility for the identified shortfall to 
individual EDCs that have data centers in their areas and to their customers despite the 
irrefutable fact that the RBP shortfall is entirely the result of data center load. PJM’s approach 
directly contradicts the principle that data center costs should be paid by data centers and 
not by other customers. PJM does not explain why it is just and reasonable to assign the costs 
of data center loads to EDCs/LSEs. PJM proposes to penalize EDCs and their customers for 
the locational decisions of data centers. As a result of the fact that PJM is avoiding taking 
responsibility for the final allocation of data center costs by EDCs, it is impossible to know 
what the final outcome of PJM’s RBP Filing will be.  
 
5  
Total data center load in 2029/2030 BRA (27,371.0 MW) minus PJM’s shortfall (6,831.3). See PJM. Total 
Load 
Adjustments 
Breakdown 
<https://www.pjm.com/-/media/DotCom/planning/res-adeq/load-
forecast/total-load-adjustments-breakdown.xlsx>.  
6  
See Monitoring Analytics, LLC, 2026 Quarterly State of the Market Report for PJM: January through June, 
Section 5: Capacity Market (August 13, 2026).

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PJM has the authority to require LSEs to condition wholesale service to data centers 
on a requirement that data centers enter into bilateral contracts with generators that protect 
other customers from the data center costs.7  
Even if PJM were to allocate costs to other customers, PJM has the authority to allocate 
the RBP costs to all PJM customers consistent with the allocation of backstop auction costs in 
the current tariff.8 
PJM asserts that it is not really allocating costs to the EDCs and their customers by 
asserting that states can require the EDCs to allocate those costs to data centers. PJM is 
attempting to evade its responsibility to directly ensure that data centers pay their own costs 
by shifting that responsibility to the states and the EDCs. PJM denies responsibility for 
allocating data center costs to data centers (at 56–58) by stating that this is not PJM’s job but 
is the job of the states, based on an incorrect understanding of the FERC/PJM jurisdictional 
authority. Despite all that, PJM does include a specific allocation of RBP data center costs to 
LSEs (EDCs here) in the event that no alternative is created by individual states and 
EDCs/LSEs are expected to allocate those costs to their customers per the method currently 
used to allocate capacity costs.9 10 
PJM focuses on the defined shortfall while ignoring the much larger issue of total 
existing and forecast data center load. On a UCAP basis, the total data center load included 
in the 2028/2029 BRA was 20,183.9 MW which is approximately three times the shortfall 
identified by PJM. The September 10th Answer does not address this fundamental issue, 
 
7  
See Protest of the Independent Market Monitor for PJM, Docket No. ER26-3380-000 (August 21, 20261, 
2026) at 28–32. 
8  
See PJM OATT Attachment DD § 16.4(e)(ii). 
9  
See RBP Filing, Attachments (A&B) Proposed OATT Attachment DD § 18.3(b)(iii). 
10  
See RAA Schedule 8 § D.

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including the fact that data center load will continue to result in a significant increase in 
capacity market costs for all customers in the upcoming 2029/2030 BRA in December 2026. 
The Market Monitor identified significant implementation issues in the RBP Filing 
that the September 10th Answer fails to address. These issues, including the explicit failure to 
address the exercise of market power, and the bafflingly complex implementation by PJM, 
are all created by PJM’s misguided attempts to blame EDCs and their customers for the 
addition of data center load rather than simply assigning the costs and risks of data center 
load to data centers. For all these reasons, the RBP Filing is unjust and unreasonable and 
should be rejected. 
The Market Monitor recognizes the urgency of the situation facing the PJM markets. 
The Market Monitor continues to recommend that the Commission reject the RBP Filing and 
direct PJM, under the Commission’s FPA Section 206 authority, to file, within two weeks, a 
solution with the following elements: 
• 
PJM should, working with LSEs and EDCs, immediately identify data center load 
not interconnected by June 1, 2026, and remove it from RPM capacity market 
auctions. 
• 
PJM should establish criteria to be included in the RAA defining the obligations of 
LSEs to require that new data center loads have 15 year bilateral contracts with 
new generation that do not permit any cost or risk shifting to other customers. The 
contracts would be based on general terms and conditions in accordance with 
tariff defined criteria with the cost and risk specifics defined by the data centers 
and generators.  
• 
For LSEs with data centers unable to make independent arrangements meeting the 
criteria, PJM should run a full single clearing price auction using the BRA capacity 
market clearing model for new data center load. LSEs would require data centers 
to participate in the reliability backstop auction if they do not have a bilateral 
contract for new generation that meets the requirements of such contracts. When 
the clearing process is complete, the LSEs would require that generators and data

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center loads enter into 15 year bilateral contracts that do not permit any cost or 
risk shifting to other customers. The contracts would be based on general terms 
and conditions in accordance with tariff defined criteria with the cost and risk 
specifics defined by the data centers and generators. 
• 
PJM should establish curtailment obligations for wholesale service to data centers 
during a defined transition period that would allow all data centers the time to 
contract for new generation. 
These requirements meet the goals of the Pledge and Principles and can be 
implemented immediately. 
I. ANSWER 
A. PJM’s Reliance on “Cooperative Federalism” Is Misguided and Has Resulted in 
a Flawed and Incomplete Proposal. 
The September 10th Answer defends (at 56–65) what it alleges is a “cost allocation 
approach” in the RBP Filing with references to “cooperative federalism.” The RBP Filing does 
not propose a cost allocation approach, it proposes to procure the 6,831.3 MW shortfall of 
capacity through a flawed process that, by default, imposes the costs and risks of meeting 
data center load on other customers. PJM hopes that the states will come up with additional 
rules for allocating costs consistent with the broad consensus represented by the Pledge and

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Principles.11 12 PJM relies on speculation about what states may or may not do to complete its 
proposal. The RBP Filing should be rejected as incomplete because it does not clearly state 
how the costs and risks of meeting data center load must be assigned to customers. PJM failed 
to file a complete regional solution consistent with its role as an RTO. PJM’s balkanized 
approach is inefficient and ineffective at creating consistent regional markets. The 
Commission has the jurisdiction needed to approve a complete proposal. 
 
11 
See The White House, “Ratepayer Protection Pledge” (March 4, 2026), <https://www.whitehouse.
gov/releases/2026/03/ratepayer-protection-pledge/?utm_source=wh_social_share_button>, 
Proclamation No. 11014, 91 Fed. Reg. 11439 (Mar. 4, 2026) (“Today, pursuant to the Ratepayer 
Protection Pledge, leading United States hyperscalers and AI companies guarantee that data centers’ 
energy needs will not increase household electricity costs for American citizens. Instead, these 
companies will build, bring, or buy the new generation resources and electricity needed to satisfy 
their energy demands, and pay for all new power delivery infrastructure upgrades to service their 
data centers. They will voluntarily negotiate new, separate rate structures with their utilities and 
relevant State governments, and pay those rates, and for their infrastructure, whether they use the 
electricity or not. They will also invest in local communities and coordinate with grid operators to 
contribute to a more reliable grid.”) (“Pledge”). On July 23, 2026, over 200 additional entities joined 
the pledge. See The White House, “President Trump’s Ratepayer Protection Pledge Secures American 
AI Dominance, Protects Consumers” (July 23, 2026), <https://www.whitehouse.gov/releases/2026/07/
president-trumps-ratepayer-protection-pledge-secures-american-ai-dominance-protects-
consumers/?utm_source=wh_social_share_button>. 
12  
National Energy Dominance Council, Statement of Principles Regarding PJM (January 16, 2026) 
<https://www.energy.gov/documents/statement-principles-regarding-pjm> 
(“Principles”). 
Two 
principles apply to the contemplated procurement of new generation. First, the procurement should 
“[p]rovide 15-year price certainty for new capacity resources” [emphasis]. The statement notes that 
this can be done in through a “Reliability Backstop Auction,” but does not require that this auction 
be a centralized procurement by PJM or that PJM customers assume risks. Second, “PJM should 
allocate the cost of any new capacity through the aforementioned Reliability Backstop Auction to 
load serving entities (LSEs) with new data centers that have not self-procured new capacity or agreed 
to be curtailable.” The principles, agreed to by the Governors of PJM States Indiana, Ohio, Maryland 
Pennsylvania, Virginia, West Virginia, Delaware, Illinois, Michigan, New Jersey, Tennessee, North 
Carolina and Kentucky, call for PJM to do the allocation and to match data centers to the costs not 
excluding risks of new resources or commitments to curtail. Additional principles that going beyond 
the RBF Proposal, the Market Proposal, or potential alternatives, include: (i) extending the price collar 
for two additional RPM Base Residual Auctions, (ii) PJM improving load forecasting, (iii) accelerating 
generator interconnections, i.e., the Reliability Resource Initiative (RRI), and (iv) continued efforts to 
reform the capacity market.

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PJM should ensure that the costs and risks of acquiring capacity to meet all data center 
load, and not just the identified shortfall, are allocated to the data centers creating those costs 
and risks in the PJM Region, consistent with the Pledge and Principles. Data centers and the 
owners of new generation built to serve them are best positioned to understand and manage 
the risks associated with building data centers and securing their power supply. It does not 
serve the public interest to assign risk to customers who have no understanding and ability 
to manage the associated risks. What states may or not do is unknown, but it cannot be 
assumed the state regulators are better able to understand and manage these risks than data 
centers and generators. The design flaws in the RBP Filing are required by PJM’s failure to 
assign risks to those that create them. 
PJM reveals that it rejects the policy determination that underlies the Pledge and 
Principles.13 Although it attempts to hide behind an incorrect jurisdictional analysis, PJM 
reveals here that it does not intend the RBP Filing to actually address the issue that it initially 
identified as the reason for submitting the RBP Filing.14 Failing to recognize the extraordinary 
nature of data center demands treats existing customers unjustly and unreasonably. PJM 
cannot show that its proposal is just and reasonable while failing to distinguish between new 
data center load and existing load. 
PJM’s attempts to justify its incomplete RBP Filing based on an improper framing of 
the Commission’s jurisdiction. States have jurisdiction over generation, and over retail sales 
 
13  
Cf. September 10th Answer at 64 (“It is fallacious to suggest that a just and reasonable cost allocation 
approach must either identify specific loads (which are not FPA-jurisdictional actors) and not the 
LSEs serving those loads or be limited to one type of load when the resource adequacy shortfall is 
caused by all types of loads that comprise the subject Load Adjustments” [emphasis in original].); 
RBP Filing at 1 (PJM proposes “to establish the Reliability Backstop Procurement (“RBP”)—a one-
time procurement of new capacity to address resource adequacy challenges in the PJM Region arising 
from insufficient commitments of capacity in the 2027/2028 and 2028/2029 Reliability Pricing Model 
(“RPM”) Auctions, primarily driven by the unprecedented addition of large loads, most notably data 
centers”). 
14  
Id.

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in their own states. States do not have jurisdiction over neighboring states. PJM does not 
show that states have the capability to perform the allocation consistent with the Pledge and 
Principles. States cooperating with (or failing to cooperate with) other states to regulate 
interstate commerce, displacing Federal regulation, is not cooperative federalism. PJM 
should not attempt to transfer its responsibility to operate the regional capacity market to the 
states. The Supreme Court has recognized that the Commission’s jurisdiction extends to rules 
related to retail customers’ participation in the wholesale power markets as sellers.15 The 
Supreme Court recognizes Federal jurisdiction over the terms and conditions of retail 
customers’ participation in wholesale markets even as they remain retail customers. 
PJM apparently believes that because data centers are retail customers, PJM cannot 
require that the LSEs who serve them place terms and conditions on service to data centers.16 
PJM has not reconciled this position with the jurisdiction exercised under the Reliability 
Assurance Agreement (“RAA”). The RAA requires LSEs to meet their obligations from 
capacity provided by generators that meet the terms and conditions of the RAA.17 LSEs are 
not permitted under the RAA to rely on Generation Capacity Resources that do not meet 
 
15  
See FERC v. EPSA, 577 U.S. 260, 281 (2016) (EPSA) (“Yet a FERC regulation does not run afoul of 
§824(b)’s proscription just because it affects—even substantially—the quantity or terms of retail sales. 
It is a fact of economic life that the wholesale and retail markets in electricity, as in every other known 
product, are not hermetically sealed from each other. To the contrary, transactions that occur on the 
wholesale market have natural consequences at the retail level. And so too, of necessity, will FERC’s 
regulation of those wholesale matters. Cf. Oneok, Inc. v. Learjet, Inc., 575 U. S. 373, 387… (2015) (noting 
that in the similarly structured world of natural gas regulation, a “Platonic ideal” of strict separation 
between federal and state realms cannot exist). When FERC sets a wholesale rate, when it changes 
wholesale market rules, when it allocates electricity as between wholesale purchasers—in short, 
when it takes virtually any action respecting wholesale transactions—it has some effect, in either the 
short or the long term, on retail rates. That is of no legal consequence.”). 
16  
See RBP Filing at 64 (“It is fallacious to suggest that a just and reasonable cost allocation approach 
must … identify specific loads (which are not FPA-jurisdictional actors) …”). 
17  
See RAA Schedules 9, et seq. & 10 (rules for PJM to evaluate capability and deliverability of 
Generation Resources).

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these terms and conditions regardless of state views about the capability of the facilities.18 
Resources included in Fixed Resource Requirement (“FRR”) Plans under Schedule 8.1 to the 
RAA must also meet requirements specified in the RAA.19 
PJM does not explain why it cannot propose terms and conditions related to data 
centers through the LSEs that serve them when it can and does include terms and conditions 
through LSEs (and other intermediate entities such as Curtailment Service Providers) on 
other retail customers and on generation facilities. The reliability backstop procurement 
would be a part of PJM’s rules designed to ensure resource adequacy through the capacity 
markets and related rules. The capacity market rules are terms and conditions of wholesale 
energy sales. 
The case for jurisdiction is stronger in this case than it was in EPSA. This case concerns 
the procurement of capacity under proposed capacity market rules. The RBP Filing is a 
modified version of the existing rules for reliability backstop auctions.20 The purpose of the 
RBP is to address the particular and extraordinary demands related to resource adequacy 
attributable to the rapid interconnection of data centers in the PJM Region. The Supreme 
Court has recognized PJM and federal responsibility in this area to the point that such 
responsibility preempts state action.21 Data centers are receiving wholesale sales along with 
the associated terms and conditions of such sales from PJM through Load Serving Entities. 
 
18  
See id. 
19  
See RAA § 7.2. 
20  
See RBP Filing at 28 (“’[B]ackstops to . . . market design based solutions that are required to insure 
reliability’ are nothing new to PJM.[citation omitted] In fact, the RBP bears several significant 
similarities to the existing Reliability Backstop Auction provisions set forth in Tariff, Attachment DD, 
section 16.”). 
21  
See Hughes v. Talen Energy Mktg., LLC, 578 U.S. 150, 163 (2016) (“We agree with the Fourth Circuit’s 
judgment that Maryland’s program sets an interstate wholesale rate, contravening the FPA’s division 
of authority between state and federal regulators. As earlier recounted, … the FPA allocates to FERC 
exclusive jurisdiction over ’rates and charges . . . received . . . for or in connection with’ interstate 
wholesale sales. §824d(a). Exercising this authority, FERC has approved the PJM capacity auction as

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PJM allocates costs to EDCs based on the level of data center load in their areas that 
the EDCs have provided to PJM through the large load adjustment process.22 While PJM 
asserts that it does not have jurisdiction over the allocation of costs to customers by the EDC, 
PJM does include rules defining that allocation to EDCs that would apply in the event that 
the states do not develop allocation rules.23 EDCs/LSEs are expected to allocate those costs to 
their customers per the method currently used to allocate capacity costs.24 
PJM denies responsibility for allocating data center costs to retail loads while making 
critical decisions about that allocation. The RBP Filing would allocate the costs of meeting 
data center load to EDCs rather than to data centers. 
PJM’s attempt to justify its incomplete proposal based on an incorrect jurisdictional 
analysis and to instead rely on speculation about actions that states may take is insufficient 
to support the RBP Filing as just and reasonable. PJM’s approach is unjust and unreasonable. 
The RBP Filing should be rejected for that reason. 
B. The September 10th Answer Fails to Address the Issues Raised by the Market 
Monitor and Others. 
1. The Shortfall is Entirely the Result of Data Center Load. 
It is a matter of fact that the apparently very precise 6,831.3 MW of shortfall is the 
result solely of data center load and that the shortfall MW are not correct.  
 
 
the sole rate setting mechanism for sales of capacity to PJM, and has deemed the clearing price per 
se just and reasonable”). 
22  
See RBP Filing, Attachment A, Proposed OATT Attachment DD § 18.3(a). 
23  
See id., Proposed OATT Attachment DD § 18.3(b). 
24  
See RAA Schedule 8 § D.

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PJM set the RTO-wide RBP procurement target as the shortfall observed in the July 
2026 RPM Base Residual Auction (“BRA”) for the 2028/2029 Delivery Year.25 PJM defined this 
shortfall as the difference between the total cleared capacity (in UCAP MW) and the RTO 
RPM reliability requirement for that auction. Table 1 shows PJM’s calculation of the shortfall 
that will be used to set the RBP procurement target. PJM’s peak load forecast for the 2028/2029 
Delivery Year, which is based on PJM’s 2026 Load Forecast Report, included 21,470.0 MW 
(ICAP) of data center load. The total organic load in PJM’s peak load forecast was only 
144,483.5 ICAP MW for the 2028/2029 Delivery Year. The data center load’s contribution to 
PJM’s reliability requirement (20,183.9 UCAP MW) was approximately three times (2.95 
times) the shortfall (6,831.3 UCAP MW) in the 2028/2029 BRA run in July 2026. There would 
have been no shortfall in the RPM BRA if not for the large data center load included in the 
peak load forecast. 
 
25  
See RBP Filing, Attachment A (Marked Tariff Records), Proposed OATT Attachment DD § 18.1(a).

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Table 1 Shortfall and Data Center Load in the 2028/2029 RPM BRA26 
 
2. The Shortfall MW Value Is Not Correct and PJM Refuses to Correct It. 
It is a matter of fact that PJM’s MW shortfall target is not correct. PJM provided no 
actual response to this point in the September 10th Answer other than to state that it is ok to 
be incorrect. PJM plans to reduce the shortfall for opt out MW but refuses to reduce the 
shortfall based on reductions in identified data center loads. 
The shortfall procurement target is based on the 2028/2029 BRA held in July 2026. PJM 
set the procurement target to the deficit calculated as the difference between the RTO 
reliability requirement and the total cleared MW in the 2028/2029 BRA. In the 2028/2029 BRA, 
the deficit was 6,831.3 MW. The data center load forecast for the 2028/2029 BRA was based 
 
26  
For this calculation, it is assumed that the FRR load does not include data center load.  
2028/2029 RPM BRA
Formula
Organic Load ICAP (MW)
144,479.5
                     
A
Data Center Load ICAP (MW)
21,474.0
                       
B
Forecast peak load ICAP (MW)
165,953.5
                     
C=A+B
FRR peak load ICAP (MW)
11,556.0
                       
D
PRD ICAP (MW)
0.0
E
Installed reserve margin (IRM)
20.0%
F
Pool-Wide Accredited UCAP Factor
78.34%
G
Forecast pool requirement (FPR)
0.9401
H=(1+F)*G
Cleared UCAP (generation and DR)
138,317.8
                     
I
Cleared ICAP (generation and DR)
176,560.9
                     
J=I/G
RPM peak load ICAP (MW)
154,397.5
                     
K=C-D-E
RPM peak load UCAP (MW)
120,955.0
                     
L=K*G
Organic reliability requirement UCAP (MW)
135,825.2
                     
M=A*H
Data Center reliability requirement UCAP (MW)
20,187.7
                       
N=B*H
FRR Obligation UCAP (MW)
10,863.8
                       
O=D*H
RPM reliability requirement UCAP (MW)
145,149.1
                     
P=M+N-O
Shortfall UCAP (MW)
6,831.3
                          
Q=P-I

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on large load adjustments received by PJM before September 5, 2025.27 Since then, several 
data center projects have been cancelled. The Market Monitor calculated that 4,016.9 MW or 
42 percent of the forecasted increase in the data center load between the 2026/2027 Delivery 
Year and 2028/2029 Delivery Year have been cancelled or delayed as of September 21, 2026.28 
29 Of the 4,016.9 MW of cancelled or delayed data center load, the Dominion EDC accounted 
for 51 percent and the AEP-Ohio EDC accounted for 29 percent. There are no provisions in 
the RBP Filing to revise the data center load forecast and the target procurement prior to the 
RBP procurement process.  
The assertion in the September 10th Answer (at 18) that the RBP procurement target of 
6,831.3 MW is “deliberately conservative” and “allowing procurement of capacity beyond 
the initial 2028/2029 Delivery Year decreases the risk of over procurement” is not supported. 
PJM arrived at the 6,831.3 UCAP MW as the shortfall in 2028/2029 Base Residual Auction that 
used the load forecast that included EDC provided large load adjustments, which were based 
on inputs from data center developers (see Table 1). These estimates are understood to 
include speculative load and have been significantly revised in the past and are likely to be 
 
27  
See PJM Presentation at Load Analysis Subcommittee, “Large Load Adjustment Discussion,” 
<https://www.pjm.com/-/media/DotCom/committees-groups/subcommittees/las/2025/20251028/20251028-
item-05---large-load-adjustments.pdf> (October 28,2025). 
28 
PJM included 11,993 MW of data center load in the 2026/2027 BRA and 21,474 MW in the 2028/2029 
BRA (see Table 2). The cancelled or delayed data center load of 4,016.9 MW as of September 21, 2026, 
represents 42 percent of the 9,481 MW increase (21,474 MW minus 11,993 MW) between the two base 
residual auctions. 
29  
The Market Monitor calculation is based on tracking of datacenter project status by Industrial Info 
Resources (IIR) corroborated by publicly available data <https://www.industrialinfo.com>. The 
Market Monitor does not have access to project level data behind large load adjustments requested 
by EDCs. The Market Monitor considered only cancelled and delayed data center projects that were 
originally scheduled to be in service by 2029 as indicated by the IIR tracking data.

- 16 - 
revised.30 PJM never did a detailed evaluation of whether each data center was likely to be 
built, leaving the details to the EDCs. 
The September 10th Answer argues (at 22) that the Commission does not require the 
RBP procurement target to be continuously adjusted to reflect updated information. PJM cites 
the Commission’s decision in which the Commission accepted information in certain contexts 
based on a perceived need for balance.31 Neither case involved condoning reliance on 
inaccurate or stale information over available accurate or fresh information. The argument 
that PJM seeks to evade is that PJM must support its 6,831.3 MW target, inherently a precise 
number, based on accurate and contemporaneous information. The cases cited by PJM 
involved acceptance of proposals intended to achieve balanced results and of rules 
potentially remaining in place indefinitely.32 PJM has not explained how reliance on stale and 
inaccurate information would contribute to a balanced procurement or any other reason. The 
RBP Filing is for a one time special reliability backstop auction in response to an emergency 
shortfall. PJM is not entitled to propose any number that it can conjure using inaccurate and 
stale information. The one time auction will place significant obligations on PJM customers 
for 15 years. Under these circumstances, PJM should recognize its obligation to procure the 
 
30  
According to a recent report by Capgemini Research Institute, “Around one in five data center power 
requests 
may 
never 
materialize, 
distorting 
forecasts,” 
<https://www.capgemini.com/wp-
content/uploads/2026/06/2025_06_25_-Capgemini_AI-meets-the-grid-report_-press-release-1.pdf> (June 25, 
2026). 
31  
Id. at 22, citing PJM Interconnection, L.L.C., 128 FERC ¶ 61,157, at P 77 (2009); Midcontinent Indep. Sys. 
Operator, Inc., 189 FERC ¶ 61,108 (2024). 
32  
See PJM,128 FERC ¶ 61,157 at P 77 (rejected argument opposing market design proposal because an 
alternative approach, that was not proposed, that could have addressed alleged “bias in estimation”); 
MISO, 189 FERC ¶ 61,108 at 64 (Approving RTO MW Value based on statement: “[W]hile an 85% 
Threshold MW Value does not eliminate these risks, they believe that it strikes the best balance 
between mitigating oversubscription and undersubscription risk.”).

- 17 - 
amount needed based on reliable evidence showing what is needed. No such procurement 
should be approved as just and reasonable unless that obligation is met.33 
PJM’s RBP Filing improperly uses stale information that will have a substantial 
financial impact on rate payers. Any procurement to serve a data center load that is not 
expected to be online at the time of the delivery year represents a fully avoidable financial 
burden for ratepayers. PJM is well positioned to obtain updated information to adjust the 
large load forecast and accordingly adjust the procurement target. Failure to do so would 
result in unjust and unreasonable outcome.  
In direct contradiction to PJM’s assertion, even with PJM’s RBP framework, the failure 
to conduct the procurement process without updated accurate information imposes 
unnecessary costs and risks on EDCs and their customers. The evidence suggests substantial 
slowdown in the data center project development.34  
Table 2 shows the data center load included in the summer peak load forecast for the 
2025/2026 through 2028/2029 RPM BRAs. PJM forecast that the load from the planned data 
centers and the forecast load growth from the existing data centers (above embedded) would 
be 16,436 MW higher for the 2028/2029 BRA.  
Table 3 shows the calculated shortfall for a range of data center load assumptions. In 
Scenario 1, the data center peak load is assumed to be fixed at 11,993 MW, the level forecast 
by PJM for 2026 (Table 2). In Scenario 1, PJM would have a 1,096.5 MW surplus rather than a 
shortfall. In Scenario 2, it is assumed that only 50 percent of the forecasted data center peak 
 
33  
See N. Plains Res. Council, Inc. v. Surface Transp. Bd., 668 F.3d 1067, 1086 (2011) (“Reliance on data 
that is too stale to carry the weight assigned to it may be arbitrary and capricious,” citing Lands 
Council v. Powell, 395 F.3d 1019, 1031 (9th Cir. 2005)). 
34  
The Market Monitor calculated that 4,016.9 MW have been cancelled or delayed as of September 21, 
2026. This calculation is based on tracking of datacenter project status by Industrial Info Resources 
(IIR) corroborated by publicly available data <https://www.industrialinfo.com>. The Market Monitor 
does not have access to project level data behind large load adjustments requested by EDCs. The 
Market Monitor considered only cancelled and delayed datacenter projects that were originally 
scheduled to be in service by 2029 as indicated by the IIR tracking data.

- 18 - 
load would be added to the PJM system between the 2026 Summer and 2028 Summer.35 This 
scenario represents the possibility that part of the data centers would not come online as 
projected by the 2028/2029 Delivery Year. The 50 percent assumption is illustrative and not 
based on actual data. In Scenario 2, the shortfall would be reduced to 2,374.7 MW. Scenario 3 
assumes that the data center load identified by the Market Monitor as cancelled or delayed 
as of September 21, 2026, will not come online by the 2028/2029 Delivery Year. The Market 
Monitor calculated that 4,016.9 MW or 42 percent of the forecasted data center load between 
2026/2027 Delivery Year and 2028/2029 Delivery Year has been cancelled or delayed as of 
September 21, 2026.36 37 In Scenario 3, the shortfall would be reduced to 3,055.0 MW. 
Table 2 Embedded and above embedded data center load for the 2025/2026 through 2028/2029 
RPM BRAs38 39 
 
 
35  
The forecasted increase in data center peak load between 2026 and 2028 is 9,481 MW (21,474 MW – 
11,993 MW). A 50 percent increase equals 16,733.5 MW (11,993 + 0.5*9,481). 
36  
PJM included 11,993 MW of data center load in the 2026/2027 BRA and 21,474 MW in the 2028/2029 
BRA (see Table 2). The cancelled or delayed data center load of 4,016.9 MW as of September 21, 2026, 
represents 42 percent of the 9,481 MW increase (21,474 MW minus 11,993 MW) between the two base 
residual auctions. 
37  
The Market Monitor calculation is based on tracking of datacenter project status by Industrial Info 
Resources (IIR) corroborated by publicly available data <https://www.industrialinfo.com>. The 
Market Monitor does not have access to project level data behind large load adjustments requested 
by EDCs. The Market Monitor considered only cancelled and delayed datacenter projects that were 
originally scheduled to be in service by 2029 as indicated by the IIR tracking data. 
38  
Embedded load means existing data center load at the time of the forecast. Above embedded includes 
forecast increases in load for both existing data center load and new data center load. 
39  
See PJM. 2026 PJM Long-Term Load Forecast Report <https://www.pjm.com/-/media/DotCom/
library/reports-notices/load-forecast/2026-load-report.pdf> (February 6, 2026). Previous PJM Long-Term 
 
2025/2026 RPM BRA (Based on 2024 Load Forecast)
4,654
                                               
7,927
                          
2026/2027 RPM BRA (Based on 2025 Load Forecast)
7,892
                                               
11,993
                        
2027/2028 RPM BRA (Based on 2025 Load Forecast)
13,018
                                             
17,071
                        
2028/2029 RPM BRA (Based on 2026 Load Forecast)
16,436
                                             
21,474
                        
Above Embedded Data Center Load
(MW)
All Data Center Load
(MW)

- 19 - 
Table 3 Shortfall under different data center load assumptions 
 
3. PJM Incorrectly Allocates Data Center Costs to EDCs/LSEs and Their 
Customers. 
PJM’s assertions about the role of LSEs obscures the fact that every EDC is an LSE but 
not every LSE is an EDC. Competitive LSEs exist in restructured states and compete with the 
zonal EDC to serve retail customers. While the exact rules vary, if there are no competitive 
LSEs, then EDCs become the default LSE. Given that PJM’s RBP Filing would impose 
significant risks on LSEs, it is very unlikely that a competitive LSE would agree to serve a 
data center load. As a result, EDCs will bear the risks that the PJM RBP Filing would impose 
on what PJM terms LSEs. EDCs are the PJM Transmission Owners plus public power entities. 
Table 4 shows the list of EDCs that may be allocated a shortfall MW under PJM’s RBP 
proposal. In this filing, the Market Monitor uses the term EDC to include this group. 
 
Load Forecast Reports <https://www.pjm.com/-/media/DotCom/planning/res-adeq/load-forecast/previous-
load-forecast-reports.zip>. 
2028/2029 RPM BRA
Scenario 1
Scenario 2 Scenario 3
Formula
Organic Load ICAP (MW)
144,479.5
                     
144,479.5
    
144,479.5
      
144,479.5
   
A
Data Center Load ICAP (MW)
21,474.0
                       
11,993.0
      
16,733.5
        
17,457.1
     
B
Forecast peak load ICAP (MW)
165,953.5
                     
156,472.5
    
161,213.0
      
161,936.6
   
C=A+B
FRR peak load ICAP (MW)
11,556.0
                       
11,556.0
      
11,556.0
        
11,556.0
     
D
PRD ICAP (MW)
0.0
0.0
0.0
0.0
E
Installed reserve margin (IRM)
20.0%
20.0%
20.0%
20.0%
F
Pool-Wide Accredited UCAP Factor
78.34%
78.34%
78.34%
78.34%
G
Forecast pool requirement (FPR)
0.9401
0.9401
0.9401
0.9401
H=(1+F)*G
Cleared UCAP (generation and DR)
138,317.8
                     
137,332.5
    
138,317.8
      
138,317.8
   
I
Cleared ICAP (generation and DR)
176,560.9
                     
175,303.2
    
176,560.9
      
176,560.9
   
J=I/G
RPM peak load ICAP (MW)
154,397.5
                     
144,916.5
    
149,657.0
      
150,380.6
   
K=C-D-E
RPM peak load UCAP (MW)
120,955.0
                     
113,527.6
    
117,241.3
      
117,808.2
   
L=K*G
Organic reliability requirement UCAP (MW)
135,825.2
                     
135,825.2
    
135,825.2
      
135,825.2
   
M=A*H
Data Center reliability requirement UCAP (MW)
20,187.7
                       
11,274.6
      
15,731.2
        
16,411.4
     
N=B*H
FRR Obligation UCAP (MW)
10,863.8
                       
10,863.8
      
10,863.8
        
10,863.8
     
O=D*H
RPM reliability requirement UCAP (MW)
145,149.1
                     
136,236.0
    
140,692.5
      
141,372.8
   
P=M+N-O
Shortfall UCAP (MW)
6,831.3
                          
(1,096.5)
       
2,374.7
           
3,055.0
        
Q=P-I

- 20 - 
Table 4 List of EDCs with Potential Allocation of Shortfall MW40 
 
4. PJM Allocates Financial Risks Created by Data Centers to EDCs and 
Their Customers. 
The fundamental design of PJM’s RBP Filing assigns the risk for data center costs to 
EDCs and their non data center customers. PJM would require EDCs to post unprecedented 
levels of collateral in order to cover the risks that PJM’s RBP Filing would inappropriately 
impose on EDCs and their customers. 
The September 10th Answer fails to address or resolve the substance of the protests 
related to the proposed RBP credit requirements. The protests question the size of the buyer 
side credit requirement, the basis for the calculation, the lack of adherence to accepted 
standards and the interaction with current RPM credit requirements. In addition, PJM gives 
no consideration to the carrying cost of the LSE collateral requirement or the effect of carrying 
this amount of debt will have on the LSE’s credit rating.41  
 
40  
See RBP Filing, Attachment C (“Croop Affidavit”) at 12. 
41  
See Protest of East Kentucky Power Cooperative, Inc., Attachment B – Coscia Affidavit at 122 and 
142, Docket No. ER26-3380-000 (August 21, 2026) (“EKPC Protest”). 
Zone
EDC
BGE
BGE
PECO
PECO
PPL
PPL
PSEG
PSEG
AEP
AEP-Ohio
APS
APS-PE
ATSI
ATSI-PP
ATSI
ATSI-Ohio
COMED
COMED
DAY
DAY
DOM
DOM
DOM
NVEC
DOM
ODEC
DOM
REC

- 21 - 
Rather than directly address the overwhelming deficiencies in the RBP Filing related 
to credit requirements, PJM suggests that the “LSE credit rules do not need to be effective for 
the RBP to be conducted” and that PJM “would consent to the Commission resolving the 
applicable buyer-side LSE RBP Credit Rate through additional procedures.”42 The Market 
Monitor disagrees. Simply ignoring the massive impact of the RBP Filing on risk, credit and 
collateral and addressing that impact only after it has been made inevitable if the rest of the 
PJM RBP Filing is accepted is not a plan. PJM’s RBP Filing must be evaluated in its entirety 
including its intended consequences for credit and risk and its unintended consequences for 
the markets. The credit provisions are fundamental to the backstop auction and should not 
be artificially separated from the backstop auction design in order to win FERC approval. 
The issues with the buyer side credit provision stem from PJM’s proposed RBP design. 
The failure to match the individual suppliers with the individual buyers creates the credit 
problem by spreading the risk to EDCs and their customers rather than limiting the risk to 
the parties to bilateral contracts. PJM’s proposed solution is to impose a credit requirement 
that could total $10.2 billion on EDCs.43 This is an unprecedented level of collateral that 
would almost double the total collateral held by PJM for all markets.44  
The September 10th Answer has no substantive response to the issues raised in the 
protests. The overwhelming credit and collateral requirements are a direct and unavoidable 
result of the RBP design. 
 
42  
September 10th Answer at 93. 
43  
Equal to the Initial Target MW (6,831.3) x $1.5 million. See EKPC Protest, Attachment B (Coscia 
Affidavit) at 7. 
44  
In support of the EKPC Protest, Dr. Coscia notes that PJM held $10.9 billion in collateral for all 
markets on July 30, 2026.

- 22 - 
PJM’s credit requirement for EDCs with data center load is $1.5 million per MW.45 46 
PJM arrived at the $1.5 million per MW value by first estimating the total value of a 1 MW 
RBP commitment for 15 years at an RBP average procurement cost of $555/MW-day, or $3.0 
million (= 15 years x $555 per MW-day x 365 days).47 With no supporting argument based on 
credit markets, PJM simply used half of the $3.0 million as the buyer side credit requirement. 
PJM notes that the present value of 15 annual payments ($220,575 = $555 per MW-day x 365 
days), discounted at 9.5 percent, is approximately $1.5 million per MW.48 49 PJM does not 
assert that this would provide adequate credit to cover the liability that the RBP Filing would 
create. PJM provides no analytical basis for the 9.5 percent discount rate. If a discount rate 
were to be used, it should reflect what the provider of collateral is paid in interest. PJM’s 
discount rate clearly does not meet that standard. PJM’s interest payments to its customers 
on held collateral is far below 9.5 percent. 
PJM’s credit requirements are significantly asymmetric between load and generation. 
While imposing these requirements on EDCs and their customers, PJM would require much 
lower credit for sellers of generation under the RBP Filing. PJM proposes that RBP sellers 
provide collateral equal to 20 percent of the first three years of their RBP sell offers.50 Under 
assumptions consistent with the buyer side obligation derivation, namely that 1 MW is 
offered at $555 per MW-day, the RBP seller’s credit requirement is $121,545 per MW (3 years 
 
45  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.8(b)(i)(B)(1). 
46  
RBP Obligation is an LSE’s allocation of RBP UCAP MW. See RBP Filing, Attachment A – Marked 
Tariff, Definitions. 
47  
RBP Filing, Attachment D (Kelly Affidavit) at 25. 
48  
RBP Filing, Attachment D (Kelly Affidavit) at 27. 
49  
Dr. Coscia points out that this calculation is meritless because PJM used a discount rate (9.5 percent) 
equal to the weighted average cost of capital for merchant generation investment that PJM assumes 
in its cost of new entry analysis. PJM offers no justification as to why this discount rate would be 
appropriate for LSEs with data center load. See EKPC Protest, Attachment B Coscia Affidavit at 129. 
50  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.8(a)(iv).

- 23 - 
x $555 per MW-day x 365 days x .20) or 4 percent of the total value of the RBP obligation. This 
means that the proposed credit requirements are $1.5 million per MW for the buyer and 
$121,545 per MW for the seller. The credit requirement is 50 percent of the total value of the 
RBP obligation for the buyer and 4 percent for the seller. PJM provides no justification for the 
buyer’s credit requirement being 12.5 times higher than the seller’s.  
The proposed provisions regarding the return of collateral would create another 
significant disparity between buyer and seller. The RBP Filing proposes that the collateral 
posted by the RBP seller be returned one year after the resource achieves commercial 
operation.51 RBP buyers must maintain their collateral for the full 15 year term. The return of 
collateral for buyers is less well defined with proposed tariff language stating that the credit 
rate “may be reduced … when total posted RBP Collateral is greater than the total remaining 
RBP Charges obligations.”52 53 The RBP Filing would ignore generator operating risk. 
PJM’s asymmetric proposal does not represent a likely result of a bilateral contract in 
which the risk was limited to the buyer and the seller. The RBP Filing imposes significant 
risks on the EDCs and therefore their customers, a comparatively small amount of risk on the 
suppliers, and no risk on the data centers. The EDCs and their customers should not bear the 
risk of these transactions. The risk should be borne by the principals of the transaction, the 
data centers and the generators. As the Market Monitor has proposed, the buyer and seller 
would have to agree to credit and breach of contract provisions, and the EDCs and the LSEs 
would not be party to the agreement.  
The EKPC Protest also identified an issue with the timing of the buyer credit 
provisions that is not addressed by the September 10th Answer. Coscia states the “credit 
 
51  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.8(a)(iii)(B). 
52  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.8(b)(i)(A). 
53  
In support of the EKPC Protest, Dr. Coscia notes that this deviates from established standards and 
current PJM practices.

- 24 - 
requirement is absent during the period of greatest uncertainty.”54 The period to which 
Coscia refers is the time between posting the RBP results and the date that collateral is due, 
which is 45 days prior to the start of the delivery year.55 For the 2028/2029 Delivery Year, the 
LSE credit requirement is due the middle of April 2028. The RBP obligations for each of the 
14 Electric Distributor zone/areas with data center load (Table 4) will be fixed at the 
conclusion of the RBP. For the period from the close of the RBP to 45 days prior to the start 
of the 2028/2029 Delivery Year, no collateral secures the EDCs’ obligation and in fact, the 
EDCs will not know their credit requirements until they are assigned an RBP Obligation. If a 
data center load fails to materialize during this period, there is no collateral to fall back on 
and the RBP charges will fall to other customers in the Electric Distributor zone/area. 
In the RBP Filing, the RBP charges are first allocated to the Electric Distributor 
zone/areas based on their pro rata shares of the Final RBP Target MW.56 The initial RBP Target 
MW is 6,831.3 MW. This value will be reduced by Qualifying RBP Offset UCAP MW and 
UCAP MW satisfying the opt out provisions.57 58 Qualifying RBP Offset UCAP MW 
correspond to data center load that was included in the shortfall that has since secured its 
own capacity. The UCAP MW eligible for the opt out provision are in an Electric Distributor 
zone/area that is not regulated by the state and the EDC is unable to allocate the RBP costs, 
i.e. some public power entities. The Final RBP Target MW will be determined just prior to the 
RBP and each “zone/area’s assigned share of the Final RBP Target MW shall remain constant 
throughout the fixed, 15-year term.”59 
 
54  
EKPC Protest, Attachment B (Coscia Affidavit) at 72.  
55  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.8(b)(i)(B)(1). 
56  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.1(a). 
57  
RBP Filing, Attachment A (Marked Tariff, Proposed OATT Attachment DD § 18.1(b). 
58  
See example calculation in RBP Filing, Attachment C (Croop Affidavit) at 46–50. 
59  
Id.

- 25 - 
The next phase of the settlement process is to allocate the RBP charges assigned to 
each Electric Distributor zone/area to EDCs. PJM states that the allocation to EDCs or end use 
customers will be based on values “provided to PJM by the Electric Distributor designated 
to coordinate with the states and/or RERRAs to the extent that states and/or RERRAs wish to 
provide the Electric Distributors with information on how costs are allocated to LSEs.”60 If 
PJM does not receive RBP Obligation MW values from an Electric Distributor zone/area then 
PJM will “assign the RBP UCAP MW using the Daily Unforced Capacity Obligation MW load 
ratio shares in the respective zone/area that are assigned RBP UCAP MW.”61 The RBP Filing 
describes this last provisions as the “backup default cost allocation.”62 
Under the so called backup default cost allocation, PJM will allocate the RBP Charges 
for the area to all LSEs (EDCs here) in the area.63 In other words, the RBP charges will be 
allocated to LSEs (EDCs here) in the same manner as RPM charges. In the case where there 
are other LSEs in the EDC with no data center load, they will also be charged for the cost of 
capacity to meet the data center load. EDCs/LSEs are expected to allocate those costs to their 
customers per the method currently used to allocate capacity costs.64 
In the case that a data center fails, the corresponding obligation will fall to other 
customers in the Electric Distributor zone/area. This is true whether the LSE has posted 
collateral or not. The collateral posted by the EDC is only accessed in the case that the EDC 
actually defaults on RBP charges. If the EDC defaults, the proposed OATT Attachment DD § 
18.9(a) would apply and the charges would be “allocated to all remaining Load Serving 
Entities responsible for paying RBP Charges” and “may be offset by the RBP Collateral 
 
60  
RBP Filing, Attachment C (Croop Affidavit) at 51. 
61  
RBP Filing, Attachment C (Croop Affidavit) at 52. 
62  
RBP Filing, Attachment C (Croop Affidavit) at 41. 
63  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.1(b)(iii). 
64  
See RAA Schedule 8 § D.

- 26 - 
posted by the defaulting” LSE.65 Otherwise, the charges would be assigned under proposed 
OATT Attachment DD § 18.3(b)(i)-(ii) to other customers in the Electric Distributor zone/area. 
5. PJM Ignores Fundamental Locational Market Requirements. 
The RBP Filing and September 10th Answer ignore the locational requirements that 
are an essential part of the capacity market. The PJM Capacity Market has been, from the 
genesis of the RPM design in 2007 based on locational reliability differences, been a locational 
market. The PJM Capacity Market includes Locational Deliverability Areas (“LDA”). PJM 
calculates a reliability requirement for every LDA with Capacity Emergency Transfer Limit 
(“CETL”) that exceeds the LDA’s Capacity Emergency Transfer Objective (“CETO”) by 115 
percent or meets other criteria. PJM has been using CETO and CETL metrics to account for 
transmission network constraints that prevent capacity in one part of the system from reliably 
serving load in another part of the PJM system. PJM’s failure to account for the actual location 
of data centers and the generation to serve them will create additional and unnecessary costs 
for all customers.  
The central objective of PJM’s Reliability Pricing Model is to limit potential loss of load 
events to approximately one event every 10 years at the RTO level. PJM applies a stricter 
criterion to ensure that the transmission constraints do not reduce reliability. PJM’s standard 
is approximately one event every 25 years for every modeled LDA.  
Many protestors have raised this issue.66 PJM’s assertion that “all capacity in PJM is 
deliverable to all loads in PJM until transmission constraints are met,” misses the point as 
PJM is aware.67 The deliverability analysis conducted when a new resource first interconnects 
to the PJM grid is used to identify necessary transmission upgrades and award Capacity 
Interconnection Rights. However, this type of interconnection study cannot and does not 
 
65  
RBP Filing, Attachment A (Marked Tariff), Proposed OATT Attachment DD § 18.9(a). 
66  
See IMM Protest at 11; EKPC Protest at 31–33; JCA Protest at 28–29; AEP Protest at 29.  
67  
See PJM Answer at 60 n.179.

- 27 - 
replace a local resource adequacy assessment in the capacity market based on CETO and 
CETL metrics. Unlike the engineering evaluation conducted to determine how much energy 
a new generator could inject, the LDA level CETO/CETL study examines power flows under 
specific emergency conditions caused by generation and transmission outages. The 
CETO/CETL analysis establishes the MW of capacity needed to meet the LDA’s reliability 
criterion. PJM’s response is inconsistent with its own practice and is simply wrong. The RBP 
Filing and September 10th Answer simply ignore the real issues that would be created if PJM 
is permitted to ignore the fundamental locational realities of the capacity market.  
PJM will continue to conduct CETO/CETL analysis for each capacity market auction. 
If the RBP results in procuring capacity that cannot be delivered to the data center load in 
such a way that the LDA reliability needs are met, the LDA where the data center is located 
would be forced to procure more capacity in the capacity market auction. If the new capacity 
is not available, the LDA with the data center would pay the maximum price for capacity 
(shortage pricing). 
PJM’s argument that accounting for locational requirements for a 15 year forward 
contract is speculative would simply ignore the implications of PJM’s RBP Filing.68 Ignoring 
locational requirements would result in excess capacity in some LDAs and a shortage of 
capacity in others.  
Under the RBP Filing, a data center load in BGE would be allowed to procure capacity 
located in a distant LDA, e.g. ComEd. BGE, located within the SWMAAC LDA has been one 
of the constrained LDAs in PJM.69 In this scenario, BGE LDA’s load would increase without 
offsetting generation and without additional transmission capacity to import power from 
outside BGE under emergency conditions. In this scenario, BGE’s reliability requirement 
 
68  
See September 10th Answer at 21. 
69  
In the 2028/2029 BRA, BGE’s internal generation accounted for only 53 percent of BGE’s reliability 
requirement. The BGE LDA price separated in the 2022/2023 through 2025/2026 BRAs.

- 28 - 
would not be satisfied and BGE customers would pay the maximum price for capacity as a 
result. 
Allowing capacity and load to be added without accounting for locational resource 
adequacy would also result in higher energy market prices and increased transmission costs. 
In the example, in the BGE LDA with higher load and lack of offsetting generation and 
transmission capacity to import power would result in higher prices in the energy market. 
This would trigger transmission upgrades. 
6. PJM’s Procurement Process is Flawed. 
The September 10th Answer fails to support the maximum average price of $555/MW-
day. The September 10th Answer asserts that because some commenters would like a higher 
number and some would like a lower number, that PJM must be correct. PJM’s illogical 
approach does not support and cannot be the basis for selecting an exact number that will 
affect the costs of many PJM customers and the revenues of the new generators.  
PJM provides no supportable reason for its failure to update the forward prices used 
in the net revenue calculation included in the Net CONE value used to calculate Point A of 
the Variable Resource Requirement (“VRR”) curve. The failure to update the forward prices, 
using PJM’s own method, resulted in an overstatement of the RBP price by $82/MW-Day 
UCAP.70 
More importantly, PJM provides no supportable reason for its failure to provide a 
mechanism to update net revenues over the contract term. PJM fails to recognize that the net 
revenue offset will vary significantly over the 15 year life of the contracts. This has nothing 
to do with the contract for differences settlement mechanism that simply assures that 
generators will be paid their contract prices. The $555/MW-day cap assumes energy and 
ancillary services net revenues are exactly equal to $361/MW-day ICAP in every one of the 
 
70  
See Protest of the Independent Market Monitor for PJM, Docket No. ER26-3380-000 (August 21, 2026) 
at Technical Appendix, included as Attachment B for more details.

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15 years in the contracts. The PJM mechanism does not include a true up mechanism to 
ensure that generators receiving a capacity payment under the RBP are neither underpaid 
nor overpaid compared to their offered gross costs. PJM’s RBP approach ignores the 
fundamental basis for the capacity market which is to provide the missing money. The same 
missing money logic should apply to the RBP. Generators need a total revenue level to cover 
the entire gross cost of units for 15 years. Total revenues include energy and capacity market 
revenues. Despite PJM’s assertions, the procurement mechanism based solely on an 
incorrectly calculated and static capacity only payment creates significant risk for generators 
and for customers by failing to account for energy market net revenues during the contract 
term. 
PJM’s RBP Filing fails to account for the likely scenario in which data center load 
increases energy prices and increases net revenues yet customers have to pay the RBP price 
that does not reflect the increased revenues to generators. 
These critical elements of the RBP design are not consistent with the design of the 
current backstop auction. The current backstop auction rules are based on the actual net costs 
of generators and reflect actual net revenues over the 15 year life of the contracts.71 The 
current rules provide for payment of 100 percent of the required revenue, accounting for both 
energy and capacity revenues. PJM fails to provide a reason for deviating from the current 
design. 
7. PJM’s Definitions of Capacity That Can Satisfy the Requirements to 
Meet Data Center Load are Inconsistent. 
In the IMM Protest at 19-22, the Market Monitor explained the differences in PJM’s 
definitions of the qualifying criteria for RBP resources and the RBP offset. In PJM’s September 
10th Answer, PJM fails to address any of the concerns raised by the Market Monitor. The 
problem is that PJM proposes to treat RBP offset capacity as equivalent to RBP supply for 
 
71  
OATT Attachment DD § 16.4(e)(ii).

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purposes of reducing the regional reliability requirement, even though the two have 
materially different contractual protections and performance obligations. 
In the September 10th Answer at 29, PJM states, “To be clear, the eligibility 
requirements for Qualifying RBP Offset UCAP and RBP Resources are not the same.” PJM 
states that both the RBP resources and the RBP offset would contribute to addressing the 
resource adequacy shortfall. But that contribution is not the same. In the September 10th 
Answer at 32, PJM claims that comparing the RBP resource and RBP offset requirements is 
an erroneous comparison. However, PJM is proposing to treat them as equivalent for 
reducing the procurement target. The comparison is relevant because the RBP Filing treats 
them as substitutes. 
In the September 10th Answer at 33-34, PJM argues that the less stringent requirements 
for the RBP offset are meant to encourage parties to voluntarily enter into bilateral 
arrangements rather than reliance on the RBP framework. PJM is choosing the preferred 
approach to be bilateral contracts in defining their proposal. In the RBP Filing (at 40), PJM 
states that “bilateral agreements may not need to be longer than five years to develop new 
capacity [Italics added].” PJM does not provide any substantive support for the less stringent 
5 year term of the RBP offset or for the differing criteria for RBP resources and the RBP offset. 
PJM does not explain how this contributes to reliability or to price stability over the next 15 
years or how it interacts with the other elements of the RBP Filing. 
In addition, the RBP Filing and IRAS Filing have inconsistent definitions of capacity 
that can be used to satisfy the requirements to meet the data center load. The IRAS Filing 
allows 10 year contracts for Bring Your Own New Capacity (“BYONC”) that could terminate 
after three years, whereas the RBP auction would require 15 year contracts but would also 
allow a five year bilateral contract to meet the same obligation under the RBP offset option.  
The RBP Filing includes inconsistent definitions of capacity that will result in 
unintended consequences for reliability and capacity market prices in the future. One result 
of the weaker requirements will be that data center load is returned to the capacity market 
sooner and will impose additional costs on other customers sooner. While this may be PJM’s

- 31 - 
goal, it is not consistent with the policy objective of requiring data centers to pay for their 
own costs rather than imposing their costs on other customers. 
II. MOTION FOR LEAVE TO ANSWER 
The Commission’s Rules of Practice and Procedure, 18 CFR § 385.213(a)(2), do not 
permit answers to protests, answers, or requests for rehearing unless otherwise ordered by 
the decisional authority. The Commission has made exceptions, however, where an answer 
clarifies the issues or assists in creating a complete record.72 In this answer, the Market 
Monitor provides the Commission with information useful to the Commission’s decision 
making process and which provides a more complete record. Accordingly, the Market 
Monitor respectfully requests that this answer be permitted. 
III. CONCLUSION 
The Market Monitor respectfully requests that the Commission afford due 
consideration to this answer as the Commission resolves the issues raised in this proceeding. 
 
Joseph E. Bowring 
Independent Market Monitor for PJM 
President 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
 
Respectfully submitted, 
 
Jeffrey W. Mayes 
 
General Counsel 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
 
72 
See, e.g., PJM Interconnection, L.L.C., 119 FERC ¶61,318 at P 36 (2007) (accepted answer to answer 
that “provided information that assisted … decision-making process”); California Independent System 
Operator Corporation, 110 FERC ¶ 61,007 (2005) (answer to answer permitted to assist Commission in 
decision-making process); New Power Company v. PJM Interconnection, L.L.C., 98 FERC ¶ 61,208 (2002) 
(answer accepted to provide new factual and legal material to assist the Commission in decision-
making process); N.Y. Independent System Operator, Inc., 121 FERC ¶61,112 at P 4 (2007) (answer to 
protest accepted because it provided information that assisted the Commission in its decision-
making process).

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Eagleville, Pennsylvania 19403 
(610) 271‐8051 
joseph.bowring@monitoringanalytics.com 
Eagleville, Pennsylvania 19403 
(610) 271‐8053 
jeffrey.mayes@monitoringanalytics.com 
Alexandra Salaneck 
Senior Analyst 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
Eagleville, Pennsylvania 19403 
(610) 271‐8050 
alexandra.salaneck@monitoringanalytics.com 
John Hyatt 
Senior Economist 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
Eagleville, Pennsylvania 19403 
(610) 271‐8050 
john.hyatt@monitoringanalytics.com 
 
Devendra R. Canchi 
Senior Analyst 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
Eagleville, Pennsylvania 19403 
(610) 271‐8050 
devendra.canchi@monitoringanalytics.com 
Paul G. Scheidecker 
Senior Analyst 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
Eagleville, Pennsylvania 19403 
(610) 271‐8050 
paul.scheidecker@monitoringanalytics.com 
Keri Dorko 
Analyst 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
Eagleville, PA 19403 
(610) 271-8050  
Keri.Dorko@monitoringanalytics.com 
 
 
Dated: September 25, 2026

CERTIFICATE OF SERVICE 
I hereby certify that I have this day served the foregoing document upon each person 
designated on the official service list compiled by the Secretary in this proceeding. 
Dated at Eagleville, Pennsylvania, 
this 25th day of September, 2026. 
Jeffrey W. Mayes 
General Counsel 
Monitoring Analytics, LLC 
2621 Van Buren Avenue, Suite 160 
Eagleville, Pennsylvania 19403 
(610) 271‐8053 
jeffrey.mayes@monitoringanalytics.com