Attachment C - Croop Affidavit.pdf
Read topic-matched comments in ER26-3380
Topics in the text: Cost allocation · Reliability and curtailment · Connecting load and generation
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Source sections
Printed headings where available; page ranges otherwise. Excerpts below are selected from the text by keyword. This transcription includes OCR of scanned material; consult the original for exact wording.
Attachment C
printed heading · Topic match: Cost allocation
Danielle Croop, Senior Manager in the Market Design group of PJM Interconnection, L.L.C.Read this passage Filed comments: Cost allocation
I. KEY DESIGN CONSIDERATIONS AND RATIONALE
printed heading · Topic match: Cost allocation
The RBP is a stop-gap, one- time measure aimed specifically at addressing the resource adequacy shortfall in the PJM Region, an effort design to work in part with the load that has voluntarily brought supply to the PJM Region—independently or with support of ongoing PJM bilateral matching…Read this passage Filed comments: Cost allocation
II. REGION-WIDE PROCUREMENT OF RBP RESOURCES
printed heading · Topic match: Reliability and curtailment
The RBP is being driven by the resource adequacy shortfall at the RTO level.Read this passage Filed comments: Reliability and curtailment
III. INTENTIONALLY
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INTENTIONALLY DIFFERENT REQUIREMENTS FOR SUPPLY ELIGIBLE TO REDUCE THE INITIAL RBP TARGET AND SUPPLY ELIGIBLE TO SUBMIT RBP SELL OFFERS AS RBP RESOURCES 10.Read this passage
A. Supply Eligible to Reduce Initial RBP Target
printed heading · Topic match: Reliability and curtailment
PJM is defining this criterion broadly to capture all meaningful sources of new UCAP serving new load that contribute to resource adequacy and prevent double procuring for new load that is bringing new capacity to the system.Read this passage Filed comments: Reliability and curtailment
B. Supply Eligible to Participate as RBP Resources in the RBP
printed heading · Topic match: Connecting load and generation
The exclusion of Surplus Interconnection Service (“SIS”) resources from supply eligible to serve as RBP Resources was driven by the fact that these projects do not bring any additional MFO or CIRs to the system.Read this passage Filed comments: Connecting load and generation
IV. PAY-AS-BID STRUCTURE
printed heading · Topic match: Cost allocation
First, the RBP is intended as a one-time procurement mechanism designed to address near-term resource adequacy challenges while PJM continues to focus on long-term market fundamentals and supporting continued commercial bilateral contracting.Read this passage Filed comments: Cost allocation
V. VOLUME-WEIGHTED
printed heading · Topic match: Cost allocation
This results in the cost to load being allocated for RBP Charges to not exceed $555/MW-day, on average, over the 15- year term.Read this passage Filed comments: Cost allocation
VI. SELECTION PROCESS
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PJM is proposing to calculate a levelized procurement cost for each RBP Sell Offer to determine the selection.Read this passage
VII. MARKET MITIGATION
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In summary, given the one-time nature of the procurement, the pay-as-bid design, the voluntary participation, and the limited scope/bilateral parallel, the implementation complexity and effectiveness would likely outweigh any corresponding benefits and therefore PJM proposes to proceed without…Read this passage
VIII. CONTRACT FOR DIFFERENCE
printed heading · Topic match: Reliability and curtailment
If the strike price is higher than the market price, the buyer must pay the difference between the strike price and market 4 Charles River Associates, PJM Reliability Backstop RFI Summary, PJM Interconnection, L.L.C. (May 27, 2026),…Read this passage Filed comments: Reliability and curtailment
IX. RBP COST ALLOCATION METHODOLOGY
printed heading · Topic match: Cost allocation
Cost allocation decisions should therefore be grounded in principles that appropriately assign costs to beneficiaries (demand) while respecting the jurisdictional boundaries between wholesale market operations and retail rate design.Read this passage Filed comments: Cost allocation
A. Step 1: Allocating to Electric Distributor Zone/Area
printed heading · Topic match: Cost allocation
To allocate costs, i.e., RBP Charges, PJM is proposing to determine cost responsibility by starting with the Initial RBP Target and determining how responsibility for the RBP UCAP MW in the Initial RBP Target should be allocated. 43.Read this passage Filed comments: Cost allocation
B. Example of Allocation to Electric Distributor Zone/Area
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Example of Allocation to Electric Distributor Zone/Area 46.Read this passage
C. Step 2: Allocating to LSEs and/or End-Use Customers Based on
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Step 2: Allocating to LSEs and/or End-Use Customers Based on RERRA-Determined Allocation or Allocating to LSEs Based on PJM Backup Allocation 51.Read this passage
D. Example of Allocation to Electric Distributor Zone/Area
printed heading · Topic match: Cost allocation
In the first scenario, the designated RBO MW that should be used to allocate charges to each LSE is submitted to PJM by the Electric Distributor and then PJM will apply the cost allocation and settle RBP Charges accordingly.Read this passage Filed comments: Cost allocation