Shapiro says this 'broken process' could lead to higher electricity costs. Here's what to know.

[Emile]

HARRISBURG — Pennsylvanians could face higher electricity bills if federal regulators don’t force the state’s grid operator to fix a “broken process” that artificially affects supply, Gov. Josh Shapiro’s administration says.

PJM Interconnection saw prices for the energy it sells to utilities skyrocket this summer. At least one major Pennsylvania utility company is warning that monthly bills may rise by $15 this year as a result, with more increases in store.

Shapiro argues the grid operator can fix the situation if it changes its energy auction rules. If it doesn’t, his complaint to the Federal Energy Regulatory Commission warns, the consequences could be dire.

“Pennsylvania ratepayers face potentially the largest unjust wealth transfer in the history of U.S. energy markets,” the complaint said.

PJM argues that Shapiro’s complaint doesn’t address the root cause of high energy prices. The real issue, the grid operator says, is growing demand and the closure of generators.

“We have been warning for over two years of the prospect that parts of our country could run short of power during high demand periods,” PJM said in a statement in response to Shapiro’s complaint. “This possibility has been growing, primarily as a result of state and federal policy decisions that are pushing generators to retire prematurely, and also due to unprecedented and rapidly growing data center construction.”

To understand the potential impact of Shapiro’s complaint, it’s important to know how energy — and energy prices — flow from the grid to your electric bill:

Continued at: https://www.spotlightpa.org/news/2025/01/pennsylvania-governor-josh-shapiro-energy-prices-electric-grid/

[Mike 03]

1. Apropos of nothing

I really like Josh Shapiro.

[modrepub]

2. This Is A Looming Storm Cloud

You bet Republicans are going to blame their opponents (Democrats and renewable energy).

At its basic level, this is a bureaucratic SNAFU. There's been a wave of generator closures mainly due market forces. Old, inefficient and costly electric generators, for the most part coal-fired units, have closed en mass over the last decade. Some of these plants have been replaced with more efficient combined cycle natural gas plants and renewables like solar and now off-shore wind projects coming on line in the next 5 years. But replacement has been really slow, and a lot of the delays go back to PJM. In defense of PJM, it's one thing to maintain an electric grid, it's another basically have to rebuild AND maintain an electric grid at the same time.

The price spikes in the electric futures market are mainly due to speculation that demand will outpace supply. If demand outstrips supply, people buying on the electric spot market are going to pay dearly.

I like Shapiro, but if prices spike, he's going to be in trouble. It's really out of his control. PJM is the responsible party. They've got to get their act together and get more generation build outs through their project approval queue.