PJM Rejects Member Plan to Rewrite Penalties

VALLEY FORGE, PA - Yesterday, Earthjustice, NRDC, Penn Future, Public Citizen, Sierra Club,  the Sustainable FERC Project, and the Union of Concerned Scientists sent a letter to the PJM board calling on them to reject the May 11 PJM-member proposal to rollback penalties for failed performance in the wake of mass gas generator failures during Winter Storm Elliott. The letter warned that doing so would undermine reliability. 

The PJM board responded the same day, issuing a letter rejecting the proposal. In their letter they wrote, “During the quick fix process, PJM articulated concerns that the endorsed changes to the penalty rate and stop-loss may contribute to reliability concerns absent additional paradigm enhancements such as stricter winterization, testing and fuel security requirements, due to the reduced incentive for generators to respond in emergencies.” 

In response to PJM’s letter, the NRDC issued the following statement: 

“PJM did the right thing, and we’re relieved to see such a swift response to such a reckless proposal,” said Tom Rutigliano, senior advocate at the NRDC (Natural Resources Defense Council.) “There should not be a public bailout of bad investment decisions, and we hope FERC takes the same tack on the questions before them now. There should be a clear message to industry that you must be able to keep the promises you are paid to keep.” 


NRDC (Natural Resources Defense Council) is an international nonprofit environmental organization with more than 3 million members and online activists. Established in 1970, NRDC uses science, policy, law, and people power to confront the climate crisis, protect public health, and safeguard nature. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Bozeman, MT, Beijing and Delhi (an office of NRDC India Pvt. Ltd). Visit us at www.nrdc.org and follow us on Twitter @NRDC. 

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