PJM filed a proposal with FERC on July 31 to launch a Reliability Backstop Procurement (RBP) on Sept. 30, 2026, aiming to close a 6,831 MW shortfall left by the grid operator's capacity auction for the 2028/2029 delivery year. PJM said the filing tracks the reliability mission set out in its board's Jan. 16 letter and goals stated by PJM governors and the White House National Energy Dominance Council.
The RBP would secure new generation resources under contracts running up to 15 years, with a maximum willingness to pay set at a MW-weighted average of $555 per MW-day. To avoid paying twice for the same supply, PJM would cut the initial procurement target by the amount of qualifying new capacity already covered by executed bilateral contracts or otherwise reaching the system on its own.
Terms covering who can supply into the procurement, how its costs get allocated, credit requirements and settlement are laid out in the Reliability Backstop Procurement board decision document PJM issued July 27. A stakeholder workshop is scheduled for Aug. 10, where PJM staff will walk through the procurement in more detail, covering key dates, participation requirements and how projects will be evaluated and selected.
States hold the cost-allocation decision
The RBP proposal states that the procurement's success requires state participation, because states, not PJM, control how its costs get passed through to load-serving entities and end-use customers. In its July 27 letter, the PJM Board of Managers said it is aware of the affordability pressures on consumers, warning that "rapid load growth, tightening supply and rising capacity costs is not sustainable." The letter said the federal government, PJM states and large load customers have all said that "new large loads should bear the costs they cause," but added that because PJM has no jurisdiction to allocate retail costs directly to individual data centers, state action will be essential. The same July 27 letter described the RBP as the first formal FERC filing among several parallel efforts, including a broader market reform push, and said the work needs to be coordinated jointly across those efforts.
A second filing targets large-load curtailment
PJM expects to submit another filing around Aug. 7 that would set out, together with state authorities and PJM members, how to require large loads that don't procure their own power supply to cut demand during periods of extreme grid stress. The proposal, previously called Connect and Manage, is now presented as PJM's Interim Resource Adequacy Service (IRAS), summarized in a July 31 document that includes redlined language still being worked out with stakeholders.
The IRAS proposal calls for a Large Load Registry to inform load-reduction priorities and improve load forecast accuracy, along with expanded data collection to help states assess whether new large loads are bringing their own new capacity onto the system. If load reductions are needed during a capacity shortage, they would be triggered before PJM's existing Pre-Emergency Load Management Actions.
Both the RBP and the pending IRAS proposal came out of PJM's Critical Issue Fast Path process, which drew input from PJM members, states, regulators and consumer advocates. The board's July 27 letter said the collaboration that began with its Jan. 16 letter will keep being essential as stakeholders work through a wider review of PJM's capacity, energy and ancillary services markets, described in the operator's "Powering Reliability Through Market Design" paper, with the aim of proposing longer-term market reforms.
