ER26-3380-000 · 2026-08-21 · Public Service Commission of West Virginia

Comments of Public Service Commission of West Virginia in response to PJM Interconnection, L.L.C.’s Reliability Backstop Procurement proposal

1 
 
UNITED STATES OF AMERICA 
BEFORE THE 
FEDERAL ENERGY REGULATORY COMMISSION 
 
PJM Interconnection, L.L.C. 
) 
Docket No. ER26-3380-000 
 
COMMENTS OF THE PUBLIC SERVICE COMMISSION OF WEST VIRGINIA  
 
 
The Public Service Commission of West Virginia (“PSCWV”) respectfully files these 
comments to address concerns regarding PJM’s July 31, 2026 filing proposing a series of steps to 
acquire a predetermined quantity of capacity in a process it calls Reliability Backstop Procurement 
(“RBP”).1  While the stated need for its unusual and hurry-up new capacity acquisition approach 
is “primarily driven by the unprecedented addition of large loads, most notably data centers, in the 
PJM Region”2 the target level for PJM’s RBP is not specific to new large loads and is not 
sufficiently flexible to modify the RBP target if alternative proposals, championed by PJM itself, 
are successful in acquiring capacity for the new large loads in a more direct way that better protects 
other electric customers from bearing cost increases for RBP capacity they do not  need, and which 
may not be needed even for new large load.    
The PSCWV does not support the filing in its present form and timetable because the 
proposal fails to provide adequate support that the target level of so-called backstop capacity is 
needed and the proposed tariff fails to assure that the RBP will acquire capacity for and will be 
paid for by New Large Loads (NLL) created by data centers that have not made arrangements to 
provide their own capacity (“unsupported NLL”).  This major defect in the PJM RBP is created 
because PJM is effectively preempting its own parallel path “bilateral matching process” which, 
                                                 
1 PJM Interconnection LL.C., Reliability Backstop Procurement to Address Resource Adequacy Concerns Stemming 
from Large Loads, Docket No. ER26-3380-000 (July 31, 2026) (“Backstop Filing”). 
 
2 PJM filing Cover Letter page 1.

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as explained by PJM, reflects a stakeholder’s preferred method for NLL to cover its capacity 
requirements. 
Indeed, throughout the underlying stakeholder process, PJM members have 
expressed a strong preference for bringing new capacity to the PJM system 
voluntarily through bilateral contracting rather than through the RBP. To streamline 
and support the efforts of PJM members to enter into bilateral arrangements for 
capacity, PJM, in partnership with PJM consultant Charles River Associates, has 
facilitated bilateral arrangements through a bilateral matching process with the aim 
of connecting supply of new capacity, i.e., new capacity resources, with new 
demand for that capacity, i.e., new load.3    
 
Instead of waiting to see if the bilateral matching process resolves the immediate need for 
capacity to serve NLL, PJM is proposing the RBP based on a perceived 6,831 MW shortfall from 
its capacity target set for its last capacity auction.4  Although PJM’s filing provides for offsets to 
reduce this artificial and potentially unnecessary 6,831 MW target, the offsets are subject to 
complex and potentially discouraging qualifications that will likely understate offsets and result in 
an excessive final RBP capacity target that will be committed for fifteen years at high prices that 
will likely exceed the clearing prices of the last two capacity auctions and could exceed an average 
of $1.4 billion per year.5  
The qualifications for the offset include:  
• Expected commercial operation date no later than June 1, 2032;  
                                                 
3 Id. page 30. 
 
4 The Initial RBP Target is the region-wide 2028/2029 Delivery Year reliability shortfall observed in the July 2026 
BRA for Delivery Year 2028/2029, i.e., 6,831.3 MW UCAP. 
 
5 PJM is setting a maximum $555 per MW-day average levelized cost of all RBP procured capacity on a “pay-as-bid” 
basis.  Thus, the marginal cleared capacity offer could be many times higher than $555 per MW-day.  If it maintained 
and acquired the 6,831 MW target at an average of $555 per MW-day, the fifteen-year price tag that PJM would 
commit its load serving entities to pay would be $1.4 billion per year.  Although there is a hope that the load serving 
entities could recover that from unsupported NLL, the risk is that a portion will be passed on to other customers.  The 
bilateral matching of willing buyers and willing sellers or any true two-sided reliability backstop auction that identifies 
and commits willing buyers will eliminate that risk and therefore is far superior to an administratively determined 
assumed willingness to pay that is assigned to state load serving entities and leaves it up to the states to assure other 
customers are not burdened with those costs.

3 
 
• New build generation resource;  
• If incremental capacity created by an uprate of existing Generation Capacity 
it qualifies, but only to the extent it is an increase in installed capacity;  
• If repowering of a deactivated generation resource the deactivation must 
have taken place prior to April 10, 2026;  
• Evidence of a signed bilateral contract for at least five Delivery Years with 
a commercial operation date prior to the start of the 2032/2033 Delivery 
Year, and matched with load that has an executed electric service agreement 
2027/2028 or 2028/2029 Delivery Year; or  
• Self-Supply generation that is in an approved or accepted integrated 
resource plan.6  
 
While these qualifications for an offset from the load serving entity allocated share of the 6,831 
target for the RBP can be individually defended, they are necessary only because the starting point 
for the RBP is a presumed shortfall, not directly tied to unsupported NLL, in PJM’s reliability 
target that has not been properly modified after the results of the bilateral matching of NLL to new 
capacity are known and the PJM capacity model has been rerun eliminating unsupported NLL with 
Bring Your Own Generation (“BYOG”) NLL.       
 FERC should not allow PJM to put the cart before the horse, or ineffectively beside the 
horse, by allowing a premature implantation of a flawed RBP while the superior bilateral matching 
process is underway and the results are unknown.  To the extent that new large loads procure new 
capacity directly the RBP procurement target should decrease. But even more importantly, from a 
cost allocation approach the bilateral contracting is superior because it reduces, or eliminates,  the 
risk of other customers bearing costs of capacity acquired for NLL.  Bilateral contracts allow the 
costs of new capacity to be assumed directly by the contracting new  large loads, creating the need 
for that capacity.  Therefore, there is a reduced need for a large PJM RBP capacity procurement 
target.  Lowering the RBP target reduces the capacity costs assigned to load serving entities that 
                                                 
6 Tariff Attachment DD 18.2

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could be potentially stranded if the new large loads cannot pick up the cost, and minimizes the risk 
of cost shifts to other, non-NLL data center customers.  
The bilateral matching process is superior to the one sided PJM capacity market which has 
no real demand price curve bid by willing buyers.  The PJM administratively determined demand 
curve may be necessary to acquire capacity under normal circumstances.  But “ the proposed RBP 
differs significantly from PJM’s standard market constructs.”7  Therefore, a market that receives 
price bids from willing buyers is superior and a reason to rely more on the bilateral contracting to 
acquire capacity to serve NLL rather than prematurely rushing into the RBP. 
Under the bilateral contracting model, willing buyers contract with willing sellers without 
resorting to centralized procurement by PJM and a complicated cost allocation or assignment 
approach that assigns costs to load serving entities and leaves it up to them to recover the costs 
from NLL.  Thus, a real supply price/demand price capacity acquisition approach is better at 
addressing the region’s capacity needs created by NLL while protecting existing customers.8 
CONCLUSION 
To protect customers, and to accomplish goal of assigning costs incurred to serve NLL  at 
a minimum, FERC should require PJM to determine a new target for the RBP based on the model 
from its last capacity auction run under two different scenarios.’  One run should exclude all NLL. 
                                                 
7 Affidavit of Danille Croop, Par. 22, Page 6 
 
8 Although transmission issues are not a part of this docket, the PSCWV is concerned that protection of customers as 
NLL Data Centers stress the electric system will become more and more important in the future and a potential $1.4 
billion per year price tag will seem small in the future as FERC, PJM, and states face costs of network upgrades to 
serve the increasing load and new generation resources.  We are currently protected by assignment of network upgrade 
costs to interconnecting generators, and eventually to interconnecting NLL.  We are also gratified that NLL Data 
Centers have pledged, along with the White House and state governors to protect customers from costs associated 
with NLL Data Center electric needs.  But allocation of transmission costs and normal RPM capacity to the correct 
beneficiaries is going to remain a difficult issue that will be faced in the future.  We believe that there is, therefore, a 
nexus between this case and future transmission and RPM cases  because establishing the policies and procedures to 
assure that costs necessary to serve new large load will be the overarching cost allocation issues in the future for both 
wholesale power supply and interstate transmission.

5 
 
The second run should exclude NLL that is bringing its own generation pursuant to the bilateral 
matching process established by PJM or for any other reason.  The difference between the two 
results will provide a critical piece of information that is necessary to determines if the RBP is 
needed, and, if it is needed, what level of capacity is needed due to unsupported NLL.  Moreover, 
by comparing a capacity reliability target that is created by unsupported NLL and providing states 
with the location and amounts of the unsupported NLL that the RBP is acquiring capacity for, PJM 
can provide states with the information needed to identify unsupported NLL,  allocate the capacity 
costs to that NLL, and insulate other customers from paying for capacity acquired to serve NLL.  
In addition, before committing the hopefully much lower level of RBP capacity there should be 
some delay after providing the state level information to states and their load serving entities so 
that they can determine that there is a realistic opportunity to recover the costs from the 
unsupported NLL and how they will accomplish that recovery.  
 
Respectfully submitted this 21st day of August, 2026. 
 
Public Service Commission of West Virginia, 
by counsel 
 
 
 
     /s/ Robert M. Adkins____________ 
Robert M. Adkins, General Counsel 
WV State Bar I.D. No. 79 
radkins@psc.state.wv.us 
201 Brooks Street, Post Office Box 812 
Charleston, West Virginia 25323 
(304) 340-0450

CERTIFICATE OF SERVICE 
 
I hereby certify that the foregoing has been served in accordance with 18 C.F.R. §385.2010 
upon each person designated on the official service list compiled by the Secretary in this 
proceeding.  
 
Dated at this 21st day of August, 2026. 
Robert M. Adkins, General Counsel 
radkins@psc.state.wv.us 
201 Brooks Street, Post Office Box 812 
Charleston, West Virginia 25323 
(304) 340-0450 
 
 
 
 
 
 
 
 
 
 
     /s/ Robert M. Adkins____________ 
Robert M. Adkins

Public Service Commission  
 
 
 
 
 
Robert M. Adkins, General Counsel 
201 Brook Street, P.O. Box 812 
 
 
 
 
       Phone: (304) 340-0450 
Charleston, WV  25323 
 
 
 
 
 
 
Fax: (304) 340-3758 
 
 
 
 
 
 
 
   E-mail: radkins@psc.state.wv.us 
 
 
August 21, 2026 
 
The Honorable Debbie-Anne A. Reese, Secretary 
Federal Energy Regulatory Commission 
888 First Street, N.E. 
Washington, D.C. 20426 
 
Re: 
Docket No. ER26-3380-000 
 
Dear Secretary Reese: 
 
Enclosed for filing in the above referenced proceeding is the Comments of the Public 
Service Commission of West Virginia. 
 
Copies of this document have been sent to the persons named on the Service List in 
this proceeding. 
 
 
 
 
 
 
 
 
Respectfully submitted, 
 
 
 
 
 
 
 
 
Robert M. Adkins 
 
 
 
 
 
 
 
(filed electronically) 
 
 
 
 
 
 
 
 
 
 
 
Robert M. Adkins  
General Counsel  
 
 
 
 
 
 
 
WV State Bar I.D. No. 79 
 
 
RMA/rm