ER26-3380-001 · 2026-10-29 · Joint Consumer Advocates (DE, DC, IL CUB, IL AG, MD, NJ)

Request for Rehearing of the Joint Consumer Advocates (DE, DC, IL CUB, IL AG, MD, NJ) of the September 29, 2026 backstop order

UNITED STATES OF AMERICA 
BEFORE THE 
FEDERAL ENERGY REGULATORY COMMISSION 
 
PJM Interconnection, L.L.C. 
Docket No. ER26-3380-000 
REQUEST FOR REHEARING OF THE JOINT CONSUMER ADVOCATES 
Pursuant to section 313 of the Federal Power Act (FPA)1 and Rule 713 of the 
Federal Energy Regulatory Commission’s (Commission or FERC) Rules of Practice and 
Procedure,2 the Delaware Division of the Public Advocate, District of Columbia Office of 
People’s Counsel, Illinois Citizens Utility Board, Office of the Illinois Attorney General, 
Maryland Office of the People’s Counsel, and New Jersey Division of Rate Counsel 
(collectively, Joint Consumer Advocates) respectfully request rehearing of PJM 
Interconnection, L.L.C., 196 FERC ¶ 61,245 (2026) (RBP Order or Order).  
PJM Interconnection, L.L.C.’s (PJM) underlying Reliability Backstop Procurement 
(RBP) proposal is meant to enable the procurement of sufficient “new capacity to address 
significant resource adequacy challenges primarily driven by an influx of large loads.”3 
The proposal, however, is fundamentally flawed because it permits the unmitigated 
exercise of seller-side market power and its design seems guaranteed to ensure that PJM 
procures more resources than are necessary, at costs higher than are warranted.4 
Notwithstanding the Commission’s concerns with several aspects of the proposal, the 
 
1 16 U.S.C. § 825l.  
2 18 C.F.R. § 385.713. 
3 RBP Order P 1.  
4 See, e.g., Protest, Motion to Reject, and Alternative Request for the Imposition of Conditions of Joint 
Consumer Advocates at 5-7 (Aug. 21, 2026), eLibrary No. 20260821-5183 (JCA Protest).

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Commission accepted without alteration many deeply flawed components of the proposed 
RBP framework. In doing so, the Commission erred in numerous respects and failed to 
meet its statutory obligation to protect PJM’s already over-burdened ratepayers from unjust 
and unreasonable charges.  
First. The Order accepts RBP without requiring reasonable market power screens 
or mitigation,5 while acknowledging (1) that the RBP’s pay-as-bid structure makes it 
“theoretically less likely [that sellers will] offer near their marginal costs,”6 and (2) PJM’s 
admission that sellers are instead more likely to offer the expected clearing price.7 In doing 
so, the Order ignores over 50 years of judicial and Commission precedent that permits the 
use of market-based transactions to set just and reasonable rates under the FPA only where 
there will likely be fair competition based upon marginal cost bids and adequate mitigation 
of seller-side market power. The Order assumes without evidence that mitigation measures 
are unnecessary because: (1) the exercise of market power will be averted if sufficient 
resources choose to participate in the RBP  and drive down prices, and (2) the inclusion of 
a proposed megawatt (MW)-weighted average-price cap will “discipline[] costs.”8 But, as 
shown below and as set forth in the JCA Protest, these assertions are legally insufficient, 
factually unsupported, and at odds with the record evidence.  
Second. The Order accepts a price cap of $555/MW-day, on a MW-weighted 
average basis, finding, without reasoned explanation, “that using the $555/MW-day price 
 
5 RBP Order P 75.  
6 Id.  
7 PJM, Reliability Backstop Procurement to Address Resource Adequacy Concerns Stemming from New 
Load Adjustments, Transmittal at 71 & n.184 (July 31, 2026), eLibrary No. 20260731-5214 (PJM Filing) 
(quoting id., Attach. C, Affidavit of Ms. Danielle Croop ¶ 33 (Croop Aff.)). 
8 RBP Order P 98.

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cap for the 2028/2029 [Base Residual Auction (BRA)] . . . is a reasonable proxy of load’s 
maximum willingness to pay for RBP capacity.”9 The Order ignores Joint Consumer 
Advocates’ arguments demonstrating that the BRA is not analogous to the RBP and that a 
$555/MW-day average price cap is unjust and unreasonable in the RBP context:  
• 
The BRA is a single-clearing-price auction that structurally incentivizes 
suppliers to offer capacity at the supplier’s marginal cost. In that context, a 
market price cap is a second-line protection against unjust and unreasonable 
prices. In the RBP pay-as-bid structure, the incentive to offer at marginal 
cost is missing, and the market average price cap affords bidders the ability 
to exercise market power by gaming their bids around the price cap. And 
whatever prices are set in the RBP will apply for a much longer period. It is 
essential to ensure that any RBP price cap is set at an appropriate level to 
ensure just and reasonable rates. 
• 
The BRA sets capacity auction clearing prices for commitment periods of a 
single year, offering little long-term price certainty. In contrast, the RBP 
sets prices for terms up to 15 years. As both PJM and FERC acknowledge, 
greater price certainty reduces supplier risk and costs.10 RBP’s greater 
revenue certainty therefore argues for a lower price cap in the long-term 
RBP than the cap that applies in the annual, single-year BRAs. 
• 
The $555/MW-day is borrowed from Point 1 of the Variable Resource 
Requirement (VRR) curve that would have applied in the BRA for the 
2028/2029 Delivery Year but for PJM’s request and the Commission’s 
approval to apply a temporary price collar with a lower cap. While Point 1 
of the VRR is a reference cost grounded in the estimated levelized Cost of 
New Entry (CONE) for a combustion turbine (CT) reference resource,  the 
RBP has no reference resource or VRR curve and there is no evidence that 
a $555/MW-day price cap will reflect the production costs of the resources 
that the RBP will procure. 
• 
The RBP proposal borrowed a BRA price cap that was not in effect for the 
2028/2029 Delivery Year because it was replaced by price collar with a 
lower cap. As the Order acknowledges, that cap—accepted by the 
Commission as just and reasonable—was just $325/MW-day.11 The Order 
fails to explain how it also could be just and reasonable to accept an RBP 
 
9 Id. P 74. 
10 See id. P 76 (“As PJM explains, long contract terms create revenue certainty for RBP Resources and 
generally can reduce financial and development risk and may improve financing opportunities through 
lower capital costs or more favorable financing terms.”). 
11 Id. P 13.

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price cap that is 70% higher and will be applied to commitment periods up 
to 15 times longer than was the case for the 2028/2029 BRA.     
Third. The RBP Order accepts without explanation the requirement that resources 
procured through the RBP be subject to a 15-year commitment despite PJM’s admission 
that a resource procurement “of at least five years is capacity that will address the reliability 
shortfall.”12 The Order acknowledges but fails to address Joint Consumer Advocates’ 
argument that it is “unjust and unreasonable to charge ratepayers for the acquisition of 
years of capacity that is not needed to address the reliability shortfall and serves no cost-
efficiency or other economic purpose.”13 The Order’s acceptance of RBP’s 15-year 
procurement terms could unjustly and unreasonably saddle captive ratepayers with some 
$13 billion in excessive and unnecessary RBP costs. 
Fourth. Finally, the RBP Order is arbitrary and capricious because it fails to engage 
arguments that RBP’s lack of locational constraints renders it unjust and unreasonable. The 
Order finds that “the volume of capacity that PJM will procure through the RBP auction—
up to 6,831 MW—is relatively small compared with total existing supply in PJM (149 
[gigawatts (GW)]), so even if RBP Resources are not located in the exact same Locational 
Deliverability Areas [(LDAs)] as new loads, the effect of any locational constraints should 
be limited.”14 But downplaying the capacity volumes, in this context, cannot be squared 
with the Order’s premise that a BRA shortfall of the same magnitude is a dire reliability 
crisis.15 Nor does the Order explain why the absence of locational constraints in the RBP 
is immaterial when (1) the Commission’s acceptance of the BRA structure was predicated 
 
12 PJM Filing, Transmittal at 39. 
13 RBP Order P 63 & n.90 (citing JCA Protest at 16). 
14 Id. P 97. 
15 Id. PP 3, 5.

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upon the inclusion of locational constraints; and (2) history shows that zonal capacity price 
separation can increase costs to ratepayers by hundreds of millions of dollars. The RBP 
resources selected without regard to location may not serve the reliability needs of the 
zones where load growth is expected. And under RBP, those resources will participate in 
the BRA as price takers and will thereby diminish the effect of the BRA’s locational price 
signals for up to 15 years. The Commission cannot dismiss the concerns of Joint Consumer 
Advocates (and others) that the RBP’s lack of locational constraints risks burdening 
ratepayers with additional capacity, transmission and energy costs that could otherwise be 
avoided based on the unsubstantiated and vague contention that such costs will be limited.16 
For the above reasons, and as explained in greater detail in Part II of this filing, 
below, Joint Consumer Advocates respectfully request that the Commission (1) grant 
rehearing of the RBP Order; (2) find unjust and unreasonable the four elements of the RBP 
framework identified herein by Joint Consumer Advocates; and (3) direct PJM to 
incorporate changes to those elements in any subsequent FPA section 20517 filing PJM 
proposes.   
I. 
STATEMENT OF ISSUES AND SPECIFICATION OF ERRORS 
In accordance with Commission Rules of Practice and Procedure 713(c)(1) and 
(c)(2),18 the Joint Consumer Advocates provide the following enumerated statement of 
issues and specification of errors, including citations to representative Commission and 
court precedent on which they rely:  
1. The RBP Order errs as a matter of law and is arbitrary and capricious and not based in 
substantial evidence in accepting a market-based rate auction structure that exceeds the 
 
16 JCA Protest at 29.  
17 16 U.S.C. § 824d. 
18 18 C.F.R. §§ 385.713(c)(1)-(2).

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Commission’s statutory authority and is unjust and unreasonable because it permits the 
unmitigated exercise of seller side market power. PJM has admitted, and the Order 
finds, that pursuant to the RBP’s pay-as-bid structure, sellers are more likely to offer 
the expected clearing price than their marginal costs. Accordingly, the RBP 
procurement is unlikely to produce competition between sellers based upon their 
marginal costs of production and will result instead in unjust and unreasonable rates 
that reflect the exercise of seller-side market power and resource offers that game the 
RBP’s market price cap. The Commission seeks to defend RBP based upon the number 
of potential sellers, but a large number of uncompetitive offers is not the same as 
competition. Without incentives for sellers to offer at prices approximating their costs, 
there is no reason to expect this auction structure to yield a just and reasonable rate that 
approximates what would be produced by fair competition based on the marginal 
production costs of the resources bidding into the market.19   
2. The RBP Order errs as a matter of law and is arbitrary and capricious and not based in 
substantial evidence by accepting a market-based price cap of $555/MW-day absent 
evidence that this cap is just and reasonable for the long-term product being procured 
and appropriately reflects the financing and other costs minus the expected revenue 
streams of resources that will provide capacity in response to RBP (not BRA) price 
signals. The RBP Order fails to provide a reasoned explanation based on the record 
evidence for accepting an average-weighted $555/MW-day price cap. Instead, it 
arbitrarily and capriciously relies upon the market price cap at which resources would 
have cleared in the 2028/2029 BRA (but for the imposition of a price collar), even 
though the BRA and RBP auction designs are fundamentally dissimilar in numerous 
material respects.20 
3. The RBP Order errs as a matter of law and is arbitrary and capricious in failing to 
respond to Joint Consumer Advocates’ objection that it is unjust and unreasonable to 
require ratepayers to pay for 15-year procurements when there is uncontroverted record 
evidence that 5-year procurements are sufficient to meet PJM’s needs and RBP’s 
purpose of satisfying a near-term resource adequacy shortfall. RBP’s acquisition of 15-
year capacity commitments is unjust and unreasonable because it may increase 
ratepayer acquisition costs by as much as $13 billion for no justifiable purpose and 
without any commensurate consumer benefit.21  
 
19 5 U.S.C. § 706(2); 16 U.S.C. § 824d; FPC v. Texaco Inc., 417 U.S. 380, 400 (1974); Gulf States Utils. Co. 
v. FPC, 411 U.S. 747, 758-59 (1973); Elizabethtown Gas Co. v. FERC, 10 F.3d 866, 870 (D.C. Cir. 1993); 
Tejas Power Corp. v. FERC, 908 F.2d 998, 1004 (D.C. Cir. 1990); NCAA v. Bd. of Regents of the Univ. of 
Okla., 468 U.S. 85, 109 n.38 (1984); see also Jefferson Parish Hosp. Dist. No. 2 v. Hyde, 466 U.S. 2, 27 n.46 
(1984).   
20 5 U.S.C. § 706(2); 16 U.S.C. § 824d; La. Intrastate Gas Corp. v. FERC, 962 F.2d 37, 44 (D.C. Cir. 1992); 
Mich. Wis. Pipe Line Co. v. Fed. Power Comm’n, 520 F.2d 84, 89 (D.C. Cir. 1975); Motor Vehicle Mfrs. 
Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983); Elizabethtown Gas Co., 10 F.3d 
866 at 870. 
21 5 U.S.C. § 706(2); 16 U.S.C. § 824d; State Farm, 463 U.S. 29; TransCanada Power Mktg. Ltd.  v.  FERC, 
811 F.3d 1, 12 (D.C. Cir. 2015); Constellation Mystic Power, LLC v. FERC, 45 F.4th 1028, 1058 (D.C. Cir. 
2022); Citadel FNGE Ltd. v. FERC, 77 F.4th 842, 856 (D.C. Cir. 2023).

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4. The RBP Order errs as a matter of law and is arbitrary and capricious and is unjust and 
unreasonable in accepting an RBP procurement structure that does not incorporate 
locational constraints for offering resources. This constitutes an impermissible 
departure from the Commission’s approval of the BRA (which required such 
constraints), is not reasoned decision making, and is likely to result in excessive 
capacity costs due to the non-deliverability of the resources to areas of need, related 
and unnecessary increases in energy and transmission costs, and the acquisition of 
resources not suited to meet the region’s reliability needs.22  
II. 
REQUEST FOR REHEARING 
A. 
The Commission’s approval of RBP exceeds its authority to rely 
on competition to set just and reasonable market-based rates 
because RBP permits and incents the exercise of seller-side market 
power. 
The RBP Order finds that PJM’s “pay-as-bid”23 auction “process for selecting RBP 
Resources . . .  [is] just and reasonable.”24 The Order accepts this pay-as-bid approach 
despite RBP’s “lack of direct market power screens or mitigation.”25 The Commission’s 
determination is unsustainable because the RBP’s pay-as-bid resource selection process 
permits—and will likely result in—the unmitigated exercise of seller-side market power. 
In “a pay-as-bid procurement [such as RBP] each selected resource is compensated 
based on its individual offer rather than a market-clearing price established by the marginal 
resource.”26 As proposed, RBP nowhere requires sellers to bid their own production costs 
and nothing prevents them from “offer[ing] the expected clearing price” of $555/MW-
 
22 5 U.S.C. § 706(2); 16 U.S.C. § 824e; Encino Motorcars, LLC v. Navarro, 579 U.S. 211, 212-13 (2016); 
State Farm, 463 U.S. 29; PJM Interconnection L.L.C., 117 FERC ¶ 61,331, P 68 (2006) (RPM Order), 
granting reh’g in part, 119 FERC ¶ 61,318, reh’g denied, 121 FERC ¶ 61,173 (2007), pet. for review denied 
sub nom., Pub. Serv. Elec. & Gas Co. v. FERC, 324 Fed. Appx. 1 (2009); PJM Interconnection, L.L.C., 197 
FERC ¶ 61,019, P 109 (2026); Citadel FNGE Ltd, 77 F.4th at 856. 
23 RBP Order P 57; see also Croop Aff. ¶ 6. 
24 RBP Order P 74. 
25 Id. P 98. See also PJM Filing, Transmittal at 66 (“[n]o direct market power screens or mitigation are being 
proposed for the RBP”).  
26 PJM Filing, Transmittal at 68 & n.171 (quoting Croop Aff. ¶ 32).

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day.27 Indeed, PJM’s own supporting witness concedes that, “[i]n a pay-as-bid approach, 
unlike a uniform clearing price construct where sellers are expected to offer a marginal 
cost, sellers are more likely to offer the expected clearing price.”28 The academic and 
regulatory literature is to like effect: “pay-as-bid auctions create the incentive for all 
suppliers to bid the expected market-clearing price, rather than submitting bids reflecting 
each facility’s individual marginal costs.”29  Tellingly, the Order agrees: “as both PJM and 
protesters note, sellers are theoretically less likely to offer near their marginal costs in a 
pay-as-bid auction.”30 
The Commission’s approval of RBP violates basic tenets governing the use of 
competitive procurement to set just and reasonable rates under the FPA. The Supreme 
Court has held that “the Commission lacks the authority to place exclusive reliance on 
market prices,”31 explaining that the “prevailing price in the marketplace cannot be the 
final measure of ‘just and reasonable’ rates mandated by the [FPA].”32 The Supreme Court 
has also found that the “directives contained in [sections] 205 [and] 206,” to ensure the 
justness and reasonableness of any sale of electric energy for resale in interstate commerce, 
 
27 Id. at 71 & n.184 (quoting Croop Aff. ¶ 33). 
28 Id. (emphasis added). As the Order explains PJM intends to run the RBP procurement mechanism with a 
“levelized procurement cost of all selected RBP Sell Offers not [to] exceed a maximum willingness to pay 
of $555/MW-day, on a MW-weighted average basis over all delivery years of the RBP.” RBP Order P 56; 
see also Croop Aff. ¶ 6. 
29 Susan Tierney, Ph.D., Todd Schatzki, Ph.D. and Rana Mukerji, Uniform-Pricing versus Pay-as-Bid in 
Wholesale Electricity Markets: Does it Make a Difference? at 18, Analysis Group (Mar. 2008) (original 
emphasis), 
https://www.nyiso.com/documents/20142/2268609/uniformpricing_v_payasbid_tierneyschatzkimukerji_20
08.pdf/7b93c886-e3ce-82cc-2dfc-b36ae96efa21;  see also Electricity market design, European Commission 
(last visited Oct. 20, 2026) (“In the pay-as-bid model, producers (including cheap renewables) would simply 
bid at the price they expect the market to clear, not at zero or at their generation costs.”),  
https://energy.ec.europa.eu/topics/markets-and-consumers/electricity-market-design_en. 
30 RBP Order P 75. 
31 FPC v. Texaco Inc., 417 U.S. at 400. 
32 Id. at 397.

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include the “responsibility to consider . . . the anticompetitive effects of regulated aspects 
of interstate utility operations.”33 Accordingly, and as the D.C. Circuit has explained, it is 
only “when there is a competitive market [that] [the Commission] may rely upon market-
based prices in lieu of cost-of-service regulation to assure a ‘just and reasonable’ result.”34 
In other words, market-based procurement is not an end in itself, but is permissible only in 
circumstances that make it “rational to assume” that competition will produce a price “close 
to marginal cost, such that the seller makes only a normal return on its investment.”35 
The Order does not identify, nor does the record contain, supporting evidence 
making it reasonable to assume that the resulting RBP procurement prices will be the result 
of true price competition or will reflect the marginal cost of the resources to be procured. 
The Order cites no judicial or Commission precedent in support of its approval of RBP as 
a pay-as-bid auction36 where sellers “are . . . likely to offer the expected clearing price” as 
opposed to their marginal cost.37 The Order does not address Joint Consumer Advocates’ 
objection that the RBP is an unlawful market-based rate when measured against the 
standards of Texaco, Elizabethtown, and their progeny.38 While the Order dismisses these 
objections to RBP as “theoretical,” it is beyond purview that sound economic theory 
 
33 Gulf States Utils. Co. v. FPC, 411 U.S. at 758-59. 
34 Elizabethtown Gas Co., 10 F.3d at 870. 
35 Id. (quoting Tejas Power Corp., 908 F.2d at 1004). See also PJM, Revisions to Reliability Pricing Model, 
Transmittal Letter at 74 & n.225, PJM Interconnection, L.L.C., Docket No. ER25-682 (Dec. 9, 2024), 
eLibrary No. 20241209-5207 (“The Commission uses a market-based approach to wholesale electric 
regulation, reasoning that, in a ‘competitive market, where neither buyer nor seller has significant market 
power, it is rational to assume that the terms of their voluntary exchange are reasonable, and specifically to 
infer that price is close to marginal cost, such that the seller makes only a normal return on its investment.’” 
(quoting Tejas Power Corp., 908 F.2d at 1004)). 
36 RBP Order P 75. 
37 PJM Filing, Transmittal at 71 (quoting Croop Aff. ¶ 33). 
38 Cf. RBP Order P 75 with JCA Protest at 17-25.

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predictive of anticompetitive behavior is centrally relevant to the Commission’s exercise 
of its ratemaking authority to ensure just and reasonable and not unduly discriminatory 
rates.39 The Order fails to demonstrate that RBP will be a fair and competitive procurement 
process free of the exercise of seller-side market power.40 
RBP’s shortcomings are manifest when compared against PJM’s standard auction 
capacity procurement mechanism, the BRA. In contrast to the RBP, “the objective of [the 
BRA is] to procure the least-cost, competitively-priced combination of resources necessary 
to meet the region’s reliability objectives.”41 The Commission has found the BRA design 
to be just and reasonable because it is intended to ensure competition and mitigate seller-
side market power by myriad means.42 The BRA includes must-offer resource obligations, 
market seller resource offer caps, a market price cap, and oversight of bids/bidding by the 
Independent Market Monitor (IMM), designed to discipline seller-side market power.43 A 
central premise of the design is that capacity sellers are expected to bid their own marginal 
costs. In accepting the BRA construct and its single clearing price model, the Commission 
 
39 See, e.g., Transmission Pol’y Study Grp. v. FERC, 225 F.3d 667, 689 (D.C. Cir. 2000), aff’d sub nom., 
N.Y. v. FERC, 535 U.S. 1 (2002). 
40 RBP Order P 75. 
41 N.J. Bd. of Pub. Utils. v. FERC, 744 F.3d 74, 101 (3d Cir. 2014). 
42 See RPM Order P 76. 
43 The forward-looking BRA was the product of a settlement with “design features [intended to] discourage 
the exercise of market power and market manipulation generally. Specific mitigation rules and increased 
competition from new entry are the most important design elements in this regard.” Id. P 6. It must be 
emphasized that Joint Consumer Advocates do not concede that the Reliability Pricing Model (RPM) is at 
present competitive or just and reasonable. As a subset of the Joint Consumer Advocates have shown in their 
pending complaint in FERC Docket No. EL25-18-000, there is inadequate new entry to mitigate the market 
power of incumbent resources and inadequate measures to mitigate that market power. Among other things, 
demand-side resources should be subject to a must-offer obligation to avoid the exercise of physical and 
economic withholding. RBP fails to provide even the less-than-acceptable protections in the current 
RPM/BRA structure.

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found that “under this model, the generator has the proper incentive to bid the lowest price 
that covers its marginal cost.”44 
The RBP includes none of the BRA’s approved mitigation measures. In something 
of an understatement, the Order acknowledges that RBP “lack[s] . . . direct market power 
screens or mitigation.”45  In fact, there is nothing in the approved design that requires RBP 
sellers to bid their own production costs and nothing that prevents them from “offer[ing] 
the expected clearing price.”46 A seller’s ability to bid successfully unconstrained by its 
competitors’ cost of production is a paradigmatic example of the exercise of seller-side 
market power.47 Here, every resource eligible to offer into the RBP can bid to raise prices 
to the $555/MW-day average-price cap regardless of its marginal cost or that of its 
competitors. In short, resources bidding into the RBP will be engaged in a gaming strategy 
rather than price competition. 
The Order proffers a series of assertions purporting to show that the RBP construct 
is just and reasonable and “the exercise of market power is unlikely.”48 None are 
convincing. 
 
44 RPM Order P 141 n.101 (quoting 113 FERC ¶ 61,278, P 43); see also Croop Aff. ¶ 33 (in a “uniform 
clearing price construct” such as the BRA “sellers are expected to offer [at their] marginal cost”). 
45 RBP Order P 98. See also PJM Filing, Transmittal at 66 (“[n]o direct market power screens or mitigation 
are being proposed for the RBP”).  
46 PJM Filing, Transmittal at 71 (quoting Croop Aff. ¶ 33). 
47 A seller that can bid the market price rather than its own marginal cost of production possesses “[m]arket 
power [because it has] the ability to raise prices above those that would be charged in a competitive 
market.” NCAA v. Bd. of Regents, 468 U.S. at 109 n.38; see also Jefferson Parish Hosp. Dist. No. 2, 466 
U.S. at 27 n.46 (“As an economic matter, market power exists whenever prices can be raised above levels 
that would be charged in a competitive market.”); William M. Landes & Richard A. Posner, Market Power 
in Antitrust Cases, 94 Harv. L. Rev. 937, 939 (1981) (“A simple economic meaning of the term ‘market 
power’ is the ability to set price above marginal cost.”). The Commission’s position is to like effect. A 
“resource[] [that can] increase prices in a specific area . . . [has] the ability to exercise market power.” 
FERC Office of Energy Policy and Innovation, Energy Primer A Handbook for Energy Market Basics at 72 
(Dec. 2023), https://www.ferc.gov/media/energy-primer-handbook-energy-market-basics.  
48 RBP Order P 98. See also id. P 75.

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First, the Order dismisses the “theoretical drawback” of sellers offering the 
expected clearing price as opposed to their marginal costs of production based upon “the 
Charles River Associates Survey Results indicating strong seller interest in the RBP 
auction.”49 Even if true, this is a legally insufficient response. The Supreme Court has held 
that Commission cannot rely upon competition alone as the basis for finding the RBP just 
and reasonable.50 That is particularly true here, where the design of the “market” facilitates 
uncompetitive conduct. 
The Order’s dismissal of market power concerns rests entirely upon a single 
assertion in PJM’s transmittal filing that “the exercise of market power is unlikely if even 
a portion of the more than 130 GW of supply identified in the Charles River Associates 
Survey Results decides to participate and drive down prices.”51 But this is pure surmise 
and is contradicted by PJM’s own statement two pages later that bidders are “more likely 
to offer the expected clearing price.”52 A collection of uncompetitive offers, no matter how 
numerous, does not constitute competition capable of producing just and reasonable prices. 
Moreover, any supposition that the number of potential suppliers will drive down 
offer prices, because suppliers will want to make sure their offers clear, ignores other 
 
49 Id. P 75. The Charles River Associates (CRA) Survey Results (RBP Order P 11 & n.17) refers to a seven-
page slide deck summarizing the results of CRA’s request for information (RFI) concerning PJM’s proposed 
reliability backstop procurement. Charles River Associates, PJM Reliability Backstop RFI Summary (May 
27, 
2026) 
(CRA 
RFI 
Summary), 
https://www.pjm.com/-/media/DotCom/committees-groups/cifp-
rbp/2026/20260527/20260527-informational-only---reliability-backstop-rfi-summary---charles-river-
associates.pdf.    
50 FPC v. Texaco Inc., 417 U.S. at 400; accord Elizabethtown Gas Co., 10 F.3d at 870. PJM admits that 
RBP’s design leaves it powerless to protect against the exercise of seller-side market power. “Given offers 
will likely have less variation and information underlying offers it can be difficult and ineffective to 
determine offers exhorting market power.” PJM Filing, Transmittal at 71 (quoting Croop Aff. ¶ 33). But this 
is no defense where the “difficult[y]” PJM faces is a consequence of its having proposed an inherently anti-
competitive procurement structure.  
51 See RBP Order P 98. See also PJM Filing, Transmittal at 69. 
52 PJM Filing, Transmittal at 71.

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aspects of the RBP auction structure. The RBP, as proposed, does not clear resources 
strictly in offer price order. Rather, it prioritizes offers for resources that can interconnect 
and become commercially operational quickly—a significantly more limited set of 
resources.53 According to the CRA presentation, most potential supply resources are still 
in the early permitting stages and are targeting commercial operation dates in the early 
2030s.54 Only about 80 projects had anticipated commercial operation dates from 2026 
through 2029, compared to more than 260 from 2030  through 2033.55 So, even if these 
forecasts are correct, they demonstrate that resources that can be built quickly will be in 
short supply. And because the RBP includes no resource offer caps, suppliers may offer 
those resources at prices well above $555/MW-day and still be confident of clearing if 
other resources offer at prices below $555/MW-day.  
The Order also ignores other record evidence that undermines reliance on the CRA 
RFI data to claim that the RBP will function as a competitive solicitation. One of PJM’s 
witnesses alleged that the RFI’s identification of a “large set of potential supply to 
participate in the RBP . . . allows the RBP to function more like a competitive 
solicitation.”56 The phrase “more like” is an implicit concession that the RBP will not be a 
 
53 The set is even more limited than it otherwise would be because the RBP Order unreasonably accepts 
PJM’s disqualification of resources—such as demand resources—that could come on line quickly but may 
not be able to commit to remain operational through the 2042/2043 delivery year. See RBP Order P 32 
(“Demand Resources and [Distributed Energy Resources] Aggregators without identified sites and a 15-
year agreement in place cannot be RBP Resources.”). 
54 CRA RFI Summary at slide 6; see also RBP Order P 94 (“[Joint Consumer Advocates] states that only 
about 80 of the 397 projects identified in the Charles River Associates Survey Results claim an ability to 
achieve commercial operation by the 2028/2029 delivery year and only 3% of all projects are under 
construction.”). 
55 Id. 
56 Croop Aff. ¶ 35 (emphasis added). The witness fails to explain why she believes there will be a large set 
of potential bidders in the RBP. The RBP will secure resources by order of delivery year (and then cost) 
with priority beginning in the 2028/2029 Delivery Year. PJM Filing, Transmittal at 75. Only about 80 of 
the 397 projects identified by CRA claim an ability to achieve commercial operation by this date and only

- 14 - 
 
price-competitive solicitation. Regardless of whether RBP attracts many bidders or few, 
the record provides no support for the Order’s supposition that these will be competitive 
bids. The record evidence points in one direction only. Whatever resources can fill the 
immediate need, those with marginal costs less than $555/MW-day will have every 
incentive to bid somewhere around the expected clearing price as opposed to their marginal 
costs. 57 According to the PJM IMM, the “RBP’s use of a pay as bid approach coupled with 
the failure to include market power mitigation will result in the exercise of market 
power.”58 
Second, the Order contends that “PJM’s proposed average-price cap of $555/MW-
day further disciplines costs by increasing the risk that high offers do not clear.”59 Far from 
being a mitigation measure, the $555/MW-day average-price cap is integral to the ability 
of RBP bidders to game the procurement with offers targeted at the price cap and thereby 
exercise seller-side market power. The average-price cap permits offers at—or above—
that price, and in no way guarantees price competition among resources whose marginal 
costs are below that price. Indeed, the Order concedes that sellers are “less likely to offer 
near their marginal costs in a pay-as-bid auction than in a single-price auction.”60 
As explained in the next section, the Order also fails to show that the $555/MW-
day “maximum willingness to pay” benchmark is itself just and reasonable or will lead to 
 
3% of all projects are under construction. CRA RFI Summary at 6. And the eligibility of those projects to 
bid into the RBP is unknown, as is the accuracy of the information provided to CRA. 
57 PJM Filing, Transmittal at 71 (quoting Croop Aff. ¶ 33). 
58 Protest of the Independent Market Monitor for PJM at 25 (Aug. 21, 2026), eLibrary No. 20260821-5317 
(IMM Protest). 
59 RBP Order P 98. See also id. P 75. 
60 Id. P 75.

- 15 - 
 
just and reasonable auction prices. What the Commission must—but fails to—show is that 
there is a meaningful relationship between PJM’s proposed $555/MW-day average-price 
cap and the actual costs of the resources that will be procured. “[T]he prevailing price in 
the marketplace cannot be the final measure of ‘just and reasonable’ rates mandated by the 
[FPA].”61 The Order makes no showing that the RBP as approved, including the 
$555/MW-day average-price cap, will create meaningful cost-based price competition 
between and among offering resources.62 PJM itself admits that this is unlikely, as it is in 
the economic self-interest of bidders to offer somewhere around the expected clearing 
price.63    
In summary, the Commission’s approval of RBP exceeds its statutory authority to 
approve market-based rates for wholesale sales of capacity. RBP leaves consumers at the 
mercy of suppliers who, unconstrained by resource price competition or any other 
meaningful mitigation measures, have every incentive and opportunity to bid as close to 
the price cap as possible. And bidders will be operating in an admittedly supply-constrained 
environment, subject only to a wholly arbitrary “willingness to pay” provision at an 
average (and potentially higher) $555/MW-day capacity price untethered to any selected 
resource’s actual cost minus its energy and ancillary services revenues. On the instant 
record, the Order’s approval of RBP exceeds the Commission’s authority under the FPA 
to authorize market-based rate transactions. RBP is demonstrably unjust and unreasonable, 
 
61 FPC v. Texaco, 417 U.S. at 397. 
62 See Elizabethtown Gas Co., 10 F.3d at 870 (it is only “when there is a competitive market [that] [the 
Commission] may rely upon market-based prices”). 
63 PJM Filing, Transmittal at 71 (quoting Croop Aff. ¶ 33).

- 16 - 
 
contrary to controlling precedent, an invitation for the abuse of seller market power, and a 
burdening of ratepayers with billions in unjust capacity charges. 
B. 
The Order provides no reasoned explanation for approving 
PJM’s proposed $555/MW-day price cap. 
The RBP Order asserts that “in establishing the value for the maximum willingness 
to pay in the RBP, PJM reasonably relied on the value of the RPM price cap that the 
Commission accepted in January and reaffirmed in July.”64 “[T]here is no question the 
Commission may attach precedential, and even controlling weight to principles developed 
in one proceeding and then apply them under appropriate circumstances in a stare decisis 
manner.”65 But application of precedent is warranted only if “the factual composition of 
the case to which the principle is being applied bear[s] something more than a modicum of 
similarity to the case from which the principle derives.”66 There is no “modicum of 
similarity” between PJM’s BRA and RBP. Accordingly, the Commission’s reliance on 
PJM’s borrowing of the recent BRA market price cap for purposes of RBP is unjustified 
and inadequately reasoned. Because the Order provides no other explanation for its 
acceptance of the price cap it fails to “articulate a satisfactory explanation for its action, 
including a ‘rational connection between the facts found and the choice made.’”67 
PJM proposed the $555/MW-day average-price cap as just and reasonable because 
it corresponds to the “uncollared price cap based on Point 1 of the VRR curve for the 
 
64 RBP Order P 74. 
65 La. Intrastate Gas Corp. v. FERC, 962 F.2d at 44 (alteration in original) (quoting Mich. Wis. Pipe Line 
Co., 520 F.2d at 89). 
66 Id. (alteration in original) (quoting Mich. Wis. Pipe Line Co., 520 F.2d at 89); see also Me. Pub. Serv. 
Co. v. FERC, 964 F.2d 5, 9 (D.C. Cir. 1992). 
67 State Farm, 463 U.S. at 43 (quoting Burlington Truck Lines v. United States, 371 U.S. 156, 168 (1962)).

- 17 - 
 
2028/2029 Delivery Year BRA.”68 PJM asserted that the “willingness to pay for a 15-year 
commitment should not exceed the amount that load would be willing to pay for a single-
year commitment under the RPM framework.”69 The Order agrees and finds that this price 
cap represents a proper balance of resource acquisition needs and ratepayers’ willingness 
to pay.70   
But in fact, as Joint Consumer Advocates argued in their Protest, the willingness to 
pay for a 15-year commitment—and the price that resources should be willing to accept, if 
guaranteed for 15 years—should be substantially less than the corresponding amounts for 
a one-year commitment.71 That is true as a general matter, as 15-year price certainty 
reduces supplier risk and eases financing.72 But it is particularly true where the reliability 
need is concentrated in the early part of the period, when the one-year commitment would 
occur. In that context, the one-year commitment reflects a scarcity price that simply should 
not be expected to apply across the full 15-year term. The Order nowhere addresses Joint 
Consumer Advocates’ argument nor explains why a willingness to pay for a one-year 
commitment when scarcity is greatest should be commensurate with the willingness to pay 
for a 15-year commitment that may extend well beyond the end of any supply crisis. 
Additionally, the BRA and RBP price caps are fundamentally different. As it is 
used in the BRA structure, Point 1 of the VRR curve for the 2028/2029 Delivery Year is a 
 
68 PJM Filing, Transmittal at 62. 
69 Id. at 64. 
70 RBP Order P 74. 
71 JCA Protest at 25. 
72 RBP Order P 76 (“As PJM explains, long contract terms create revenue certainty for RBP Resources and 
generally can reduce financial and development risk and may improve financing opportunities through 
lower capital costs or more favorable financing terms.”).

- 18 - 
 
hard cap. Load would never under any outcome pay more than the $555/MW-day fixed 
price cap. And it is a fail-safe measure employed in the context of a single-price-auction 
that incentivizes resources to offer prices close to their marginal costs. In contrast, as used 
in the RBP, the $555/MW-day price is likely harmful to ratepayers because it allows sellers 
to exercise market power and bid the cap price as opposed to their marginal cost of 
production. And it is a “soft” price cap that binds only on average, meaning that ratepayers 
are subject to paying a selected resource’s “as bid” offer price even if it exceeds $555/MW-
day and no matter by how much it exceeds the resource’s marginal costs. Moreover, it is 
plausible that ratepayers may pay more than $555/MW-day for RBP-acquired capacity, 
even on average. This is because the RBP’s actual $/MW-day average-price cap will 
increase to the extent any resource or combination of resources that bid less than 
$555/MW-day fail to enter commercial operation or cease operation prior to the end of 
their RBP commitment term. 
As Joint Consumer Advocates explained, the possibility that ratepayers may pay 
more than an average acquisition price of $555/MW-day is a matter of simple mathematics 
and can be shown through the following example.73 Assume, for simplification purposes, 
that the RBP procures a total of 5,000 MW at an average price of $555/MW-day. Assume 
further that 1,000 MW of load has bid in at a price of $400/MW-day: a price higher than 
the 2028/2029 Delivery Year $325/MW-day price collar but sufficiently below the 
$555/MW-day average price to facilitate being selected. Assume further that the selected 
low-price load does not enter commercial operation. The loss of this load would cause the 
 
73 JCA Protest at 26-27.

- 19 - 
 
actual RBP average price to increase to $593.75/MW-day.74 This outcome is not 
implausible; PJM recognizes that RBP committed resources may fail to achieve 
commercial operation for sundry legitimate reasons including the lack of necessary 
Network Upgrades.75 Over the 15-year RBP commitment term, the price increase in this 
example results in roughly $850 million in gross costs beyond what “load would be willing 
to pay” as measured against PJM’s own standard.76 Again, the Order nowhere to comes to 
grips with Joint Consumer Advocates’ showing that the BRA’s hard price cap is 
fundamentally different and more ratepayer protective than the RBP’s soft price cap. 
The Commission’s approval of PJM’s borrowing of Point 1 of the VRR curve is 
likewise inapposite because it is a reference cost grounded in the estimated CONE for a 
CT, and is the market price cap in the BRA where bidders are expected to offer at their 
marginal cost of production.77 By comparison, the RBP has no reference resource or VRR 
curve, nor is it anticipated that bidders will bid their cost of production.78  Unlike the BRA, 
 
74 An RBP acquisition of $555/MW-day multiplied by 5,000 MW equals $2,775,000 per day in capacity 
charges. Removing 1,000 MW of committed resources at $400/day results in $2,375,000 per day in capacity 
charges ($2,775,000 minus $400,000), now spread over 4,000 MW of resources. This results in a 
$593.75/MW-day average price: an increase of $38.75/MW-day over the soft cap of $555/MW-day. 
75 PJM Filing, Attach. D, Affidavit of Ms. Gwen Kelly ¶¶ 10-11 (Due to a variety of RBP project development 
risks, “PJM concluded that resources seeking RBP commitments present risks that a committed resource may 
fail to achieve commercial operation or experience delays in reaching commercial operation.”); see also PJM 
Filing, Transmittal at 60 (excusing from RBP shortfall charges RBP resources that fail to meet their 
commercial operation dates solely because of Network Upgrade issues). 
76 While in some circumstances there may be charges imposed on resources that fail to achieve commercial 
operation, those charges are limited, and such shortfall charge amounts are unlikely to overcome the cost 
increase described here. 
77 “PJM states that the choice of a CT plant as the Reference Resource is consistent with criteria that PJM 
has used in previous Periodic Reviews, including: (1) feasibility to build; (2) whether the resource is an 
economic source of incremental capacity; and (3) whether the resource’s Net CONE can be accurately 
estimated. [The Commission] find[s] that PJM reasonably supports its conclusion that a CT plant meets these 
criteria because it is feasible to build and offers an economically viable source of incremental capacity.” PJM 
Interconnection, L.L.C., 194 FERC ¶ 61,049, P 16 (footnote omitted), on reh’g, 196 FERC ¶ 61,007 (2026). 
78 PJM Filing, Transmittal at 71 (quoting Croop Aff. ¶ 33).

- 20 - 
 
PJM will not undertake to ascertain whether any RBP offer reflects the resource’s cost of 
production.79 A review of PJM’s proposed gating criteria confirms that PJM’s offer review 
will be limited to a “demonstrat[ion] that the proposed resource will be successfully 
completed and able to provide capacity.”80  
The Order’s sole justification for the RBP’s $555/MW-day price cap is that “PJM 
reasonably relied on the value of the RPM price cap that the Commission accepted” for the 
2028/2029 BRA.81 But that reliance is not reasonable. There is nothing reasonable—let 
alone consistent with record evidence—about plucking a figure from the BRA construct 
and applying it to the dissimilar context of the RBP. The Order fails to show any rational 
connection between the 2028/2029 BRA price cap and its application to the RBP, including 
that a $555/MW-day price bears any meaningful relationship to the marginal costs of 
production of the resources RBP will procure.82 Worse, the Order takes from the BRA 
construct a price cap that was not even made effective for the BRA itself. The Order does 
not grapple with the Commission’s own finding that a $325/MW-day price cap is just and 
reasonable, much less explain why the RBP price cap should be 70% higher despite RBP 
providing a more than a decade of additional price certainty beyond what the BRA offers. 
As the Order itself recognizes, long-term revenue certainty reduces supplier risk and 
financing costs.83 While the implication of that (correct) assertion is obvious, the Order 
does not come to grips with the corollary that any cost-based price cap should be lower (or 
 
79 Id. at 66 (“No direct market power screens or mitigation are being proposed for the RBP.”). 
80 Id. at 71. 
81 RBP Order P 74. 
82 Elizabethtown Gas Co., 10 F.3d 866 at 870. 
83 RBP Order P 76.

- 21 - 
 
at the very least no higher) in the longer-term RBP than the cap actually applied in the far 
shorter-term BRA. 
C. 
The Order is arbitrary and capricious in failing to address why it 
requires 15-year RBP resource commitments when PJM admits 
that 5-year contracts eliminate the need for RBP procurement. 
An agency’s action is arbitrary and capricious if it “entirely fail[s] to consider an 
important aspect of the problem” before it or fails to establish a reasonable connection 
between the decisions made and the facts found.84 That is the case here. The problem to be 
addressed by the RBP is a near-term capacity shortfall. The Order points to what it 
describes as “grave resource adequacy concerns” based on the last two BRAs, for the 
2027/2028 and 2028/2029 Delivery Years, having cleared 5% less capacity than the PJM 
target reserve margin.85 The RBP is intended to make up this shortfall as soon as possible, 
not to address future capacity procurement concerns, and therefore prioritizes the clearing 
of resources based on how quickly they can reach commercial operation.86 And consistent 
with this focus on near-term resource adequacy, PJM contemplates that bilateral capacity 
procurement with a contract term of just five years will eliminate the need for RBP 
procurement and will justify reducing the RBP Target by the amount procured bilaterally.87 
Despite the near-term nature of the reliability need and an absence of evidence that 
the BRA will need RBP supplementation in the long term,88 the Order nonetheless accepts 
 
84 State Farm, 463 U.S. at 43. 
85 RBP Order PP 5, 13, 29-30. 
86 Id. P 61 (“PJM explains that, in selecting resources from the offer stack, it will first look to RBP 
Resources expected to reach commercial operation in the 2028/2029 delivery year,” followed by “resources 
offered with an expected commercial operation date in the 2029/2030 delivery year, and will continue 
iteratively, up to and including the 2032/2033 delivery year, until the set of offers selected meets the Final 
RBP Target.”). 
87 Id. P 125. 
88 The Order notes that “RBP is a one-time procurement.” Id. P 1.  No additional RBP procurements are 
proposed nor has the Commission set the issue of possible additional kindred procurements for hearing or

- 22 - 
 
PJM’s proposal to require a lengthy minimum RBP commitment term—up to 15 years 
depending on the resource’s commercial operations date. The Order approves requiring 
RBP resources to agree to commitments through the 2042/2043 Delivery Year.89 This 
produces two unnecessary, adverse consequences. First, it disqualifies resources that could 
attain commercial operation quickly but may not be able to commit to such a long 
commitment period. By disqualifying these resources, the Order arbitrarily shrinks the pool 
of resources that can compete to satisfy the near-term resource adequacy need to which 
RBP is meant to respond. Second, the unsupported minimum term requirement forces 
ratepayers to pay supra-competitive RBP prices for an unnecessarily long time, further 
burdening ratepayers that are already paying enormous BRA capacity costs. 
The Order acknowledges Joint Consumer Advocates’ argument that RBP is unjust 
and unreasonable because “PJM’s assertion that a five-year contract is sufficient to satisfy 
the RBP’s short-term reliability need cannot be squared with a proposal requiring 15-year 
commitments to meet the same need.”90 But it does not meaningfully respond to that 
objection, and instead finds the RBP’s 15-year procurement term eligibility requirements 
just and reasonable.91 Thus, the Order fails to come to grips with the material evidentiary 
contradiction at the heart of RBP. Although the Order has set PJM’s Load Adjustment 
process (which includes bilateral offset capacity) for hearing, it does not address that PJM’s 
 
suggested PJM make an FPA section 205 filing to address that issue. Id. P 3. The Commission has sought 
additional briefing or a further PJM section 205 filing only to address: (1) the proposed municipal and co-
operative opt out provision, id. P 152; (2) PJM’s proposed cost allocation, including its reliance on Load 
Adjustments for that purpose, id. PP 156-57; (3) the assignment of RBP costs to exiting TOs, id. P 179; and 
(4) PJM’s proposed buyer-side collateral requirements, id. P 206. 
89 Id. P 50. 
90 Id. P 40. 
91 Id. P 48.

- 23 - 
 
as-filed proposal undercuts the notion that 15 years of payments are needed to address the 
shortfall.92 The proposal is express that Load-Serving Entities can fulfill their share of the 
RBP capacity obligation outside of the auction by procuring 5-year bilateral contracts. 
Proposed Tariff, Attachment DD, section 18.2(c) explains that “Evidence of Qualifying 
RBP Offset [Unforced Capacity (UCAP)] MW” can include “[s]igned bilateral contracts 
. . . for at least five Delivery Years with a commercial operation date prior to the start of 
the 2032/2033 Delivery Year.” In its Transmittal Letter, PJM calls a five-year term 
“balanced,”93 explaining:94  
Capacity with a bilateral contract of at least five years is 
capacity that will address the reliability shortfall and is not 
transitory. Furthermore, a five-year term is not so lengthy as 
to undermine the flexibility needed for commercial 
contracting or to pose a significant barrier to eligibility for 
Qualifying RBP Offset UCAP MW, in recognition of the 
fact that bilateral agreements may not need to be longer than 
five years to develop new capacity. 
In accepting PJM’s proposed 15-year RBP term, the Order ignores and has no answer for 
PJM’s own determination that procurements “of at least five years is capacity that will 
address the reliability shortfall.”95 
The Order itself makes no independent determination that 15-year RBP 
procurement terms are necessary to redress PJM’s near-term resource adequacy shortfall. 
Indeed, PJM does not contend as much. PJM only supports this facet of the proposal by 
pointing to the January 16, 2026, Statement of Principles Regarding PJM that was signed 
earlier this year by federal officials on behalf of the White House National Energy 
 
92 Id. PP 150-56. 
93 PJM Filing, Transmittal at 39. 
94 Id. at 39-40. 
95 Id. at 39.

- 24 - 
 
Dominance Council and the governors of all thirteen PJM states (but not the Mayor of the 
District of Columbia), referencing the document’s call to “[p]rovide 15-year price certainty 
for new capacity resources.”96 PJM offers no analysis comparing the ratepayer cost of a 
15-year term against shorter alternatives. And the CRA RFI survey information PJM relies 
upon shows that there are resources willing to agree to shorter terms. Roughly 1/5 (21%) 
of the supply-side response projects would agree to terms of 10 years or shorter, and 
another 13% of respondents were “flexible” as to term.97 Though Joint Consumer 
Advocates identified all of these issues in their protest, the RBP Order addresses none of 
them in accepting PJM’s proposal.98  
It is beyond question that requiring ratepayers to pay for 15-year procurements 
when PJM has admitted that five-year procurements are sufficient to meet its resource 
adequacy needs is a material issue. The amount of RBP charges for PJM’s proposed 
procurement total of 6,831 MWs at a rate of $555/MW-day x 365 days x 15 years would 
be $20,756,847,375. That same procurement for a term of five years would be some 
$13 billion less, $6,918,949,125. Given the magnitude of ratepayer charges at issue, the 
Commission cannot, in approving 15-year procurement terms, simply airbrush away PJM’s 
admission that five-year procurements are adequate to meet its reliability needs for 
purposes of RBP.  
 
96 Id. at 48 (quoting National Energy Dominance Council, Statement of Principles Regarding PJM at 1 
(Jan. 16, 2026) (Statement of Principles), https://www.energy.gov/documents/statement-principles-
regarding-pjm).  
97 CRA RFI Summary at 5.  
98 JCA Protest at 14-16.

- 25 - 
 
It is no answer to say that the lengthy minimum term is justified in exchange for 
the revenue certainty that RBP will provide.99 If a shorter term were permitted, the period 
of revenue certainty would be commensurately shorter too. The minimum term 
requirement is the independent variable. The period of revenue certainty is a function of 
the RBP term, not the other way around. The Order offers no basis for concluding that a 
15-year minimum term is necessary to meet the reliability need, as even PJM, the 
proposal’s proponent, admits that a shorter term will meet the same need, and in a 
“balanced” fashion. 
It is unjust and unreasonable to charge ratepayers for the acquisition of 10 years of 
capacity that is not needed to “address the reliability shortfall” and serves no 
cost-efficiency or other economic purpose. In Citadel FNGE Ltd. v. FERC, the D.C. Circuit 
explained that the “application of [a PJM auction rule] was unjust and unreasonable not 
just because of how much it increased the wholesale rate, but because it caused that increase 
for no justifiable purpose” and “without any commensurate [consumer] benefit.”100 That 
“comfortably fits the definition of unjust and unreasonable.”101 Where a price increase 
“serv[es] no good purpose,” the absence of a reasoned justification for it makes it “unjust 
and unreasonable in its own right.”102 The Order acknowledges Joint Consumer 
Advocates’ reliance upon Citadel in objecting to 15-year RBP procurement terms based 
 
99 RBP Order P 50.  
100 Citadel FNGE Ltd., 77 F.4th at 856. 
101 Id. 
102 Id. at 857.

- 26 - 
 
upon PJM’s concession that five-year resource acquisitions are sufficient but fails to 
explain why 15-year terms are necessary or provide any ratepayer benefit.103 
“It is well established that the Commission must ‘respond meaningfully to the   
arguments   raised   before   it.’”104  In accepting PJM’s proposed 15-year RBP procurement 
terms while ignoring Joint Consumer Advocates’ objection that the length of these terms 
is overly long and unnecessary based upon PJM’s own admission, the Order is arbitrary 
and capricious. 
D. 
The RBP Order errs by failing to require that the RBP 
incorporate locational constraints. 
 While PJM “recognizes there are locational considerations at large for resource 
adequacy, and these constraints are modeled in the Reliability Pricing Model[,]”105 RBP 
includes no locational procurement signal.106 The Order nonetheless “find[s] that the 
proposal’s lack of locational constraints does not render PJM’s overall proposal unjust and 
unreasonable.”107 The RBP Order dismisses Joint Consumer Advocates’ (and others’)108 
objections that the absence of locational criteria for RBP poses unjustified cost risks for 
ratepayers by pointing to the amount of capacity to be procured through RBP:109 
Specifically, the volume of capacity that PJM will procure 
through the RBP auction—up to 6,831 MW—is relatively 
 
103 RBP Order P 63 & n.90 (citing JCA Protest at 16). 
104 TransCanada Power Mktg. Ltd., 811 F.3d at 12 (quoting Pub. Serv. Comm'n v. FERC, 397 F.3d 1004, 
1008 (D.C. Cir. 2005)); Constellation Mystic, 45 F.4th at 1058 (the Commission “entirely failed to address 
[petitioner’s] argument,” and the “failure to respond meaningfully . . . renders its decision arbitrary and 
capricious.” (internal quotations and citation omitted)). 
105 Croop Aff. ¶ 8. 
106 Id. ¶ 7. 
107 RBP Order P 97. 
108 See, e.g., IMM Protest at 7-8, 11; see also RBP Order P 92 (summarizing objections to lack of locational 
constraints). 
109 RBP Order P 97.

- 27 - 
 
small compared with total existing supply in PJM (149 GW), 
so even if RBP Resources are not located in the exact same 
Locational Deliverability Areas as new loads, the effect of 
any locational constraints should be limited. 
 
That is a strange argument, to say the least, when the same “relatively small” shortfall is 
the justification for implementing the RBP procurement—and its commitment of 
ratepayers to 15 years of excessive prices—in the first place. The Order makes no effort to 
grapple with the contradiction. 
Moreover, the Order’s conclusion that the absence of locational constraints will 
have “limited” effect is unwarranted speculation that fails to respond meaningfully to the 
concern raised by Joint Consumer Advocates that RBP’s lack of locational constraints risks 
burdening ratepayers with additional new transmission and energy costs (if the large load’s 
arrival on the grid creates congestion) that could otherwise be avoided.110 Significantly, 
the RBP Order does not deny Joint Consumer Advocates’ concern—instead, it merely 
supposes that any additional burden would be minimal. But that is no answer. Even 
assuming, arguendo, that the Commission’s supposition proves accurate, a design 
component does not become just and reasonable because the unjustified burden placed on 
ratepayers is “limited.” 
In any event, there is no basis for assuming that any such effect will be small. If 
RBP Resources cannot reach the LDAs with new large loads, price separation is possible 
(if not likely), in which case ratepayers would be burdened with potentially hundreds of 
millions of dollars in increased capacity costs as well as additional new transmission and 
energy costs that could be avoided or ameliorated through the use of a locational 
 
110 JCA Protest at 29.

- 28 - 
 
procurement signal.111 In the 2024/2025 BRA, price separation in the Delmarva Power and 
Light Zone resulted in “PJM spend[ing] an additional $182.8 million to procure just 1.9 
per cent more capacity.”112  
The Commission knows that the absence of locational considerations for purposes 
of resource acquisition can result in otherwise avoidable adverse rate and reliability 
consequences. In approving the current RPM construct, the Commission found “that the 
locational pricing phase-in provisions of the settlement as proposed are just and 
reasonable.” These BRA locational pricing provisions “address[ed] the Commission’s 
concerns that appropriate price signals are available to provide incentives to construct 
facilities necessary for regional reliability by assuring that the market value of resources 
used to meet the capacity requirements reflect actual deliverability and availability of the 
capacity resource within the specific region relying on that resource.”113 Yet the RBP Order 
will nullify the very locational price signals that the Commission has found important to 
the BRA. RBP resources will participate in the BRA as price takers. Consequently, the 
roughly seven GW of non-locationally-procured RBP capacity will displace a 
corresponding amount of BRA capacity responding to locational price signals.  
In its recent order addressing PJM’s Interim Resource Adequacy Service (IRAS) 
proposal the Commission expressed “concern[] that PJM’s proposal does not take into 
 
111 See, e.g., Answer and Motion for Leave to Answer of the Independent Market Monitor for PJM at 27-28 
(Sep. 25, 2026), eLibrary No. 20260925-5208 (IMM Answer) (quoted infra). 
112 Md. Off. of People’s Couns. v. FERC, 164 F.4th 920, 925 (D.C. Cir. 2026). 
113 RPM Order P 68.

- 29 - 
 
account locational or deliverability considerations for [Bring Your Own New Capacity 
(BYONC)] resources.”114 
[U]nder PJM’s existing Tariff, PJM identifies LDA 
Reliability Requirements, which require sufficient capacity 
to be inside or deliverable to the LDA based on transmission 
constraints. Under PJM’s proposal, the New Large Load 
would not be subject to IRAS, and its load would not be 
counted towards the Eligible New Large Load amount for its 
[Electric 
Distribution 
Company 
(EDC)] 
zone/area, 
regardless of transmission constraints between the New 
Large Load and the BYONC resource, which could 
exacerbate the resource adequacy shortfall in the New Large 
Load’s zone.115 
 
The IMM raised these same concerns in this proceeding.116 
PJM will continue to conduct [Capacity Emergency Transfer 
Objective (CETO)/Capacity Emergency Transfer Limit 
(CETL)] analysis for each capacity market auction. If the 
RBP results in procuring capacity that cannot be delivered to 
the data center load in such a way that the LDA reliability 
needs are met, the LDA where the data center is located 
would be forced to procure more capacity in the capacity 
market auction. If the new capacity is not available, the LDA 
with the data center would pay the maximum price for 
capacity (shortage pricing). 
 
* * * 
 
Under the RBP Filing, a data center load in [Baltimore Gas 
& Electric (BGE)] would be allowed to procure capacity 
located in a distant LDA, e.g. [Commonwealth Edison 
Company (ComEd)]. BGE, located within the [Southwest 
Mid-Atlantic Area Council (SWMAAC)] LDA has been one 
of the constrained LDAs in PJM. In this scenario, BGE 
LDA’s load would increase without offsetting generation 
and without additional transmission capacity to import 
power from outside BGE under emergency conditions. In 
this scenario, BGE’s reliability requirement would not be 
 
114 197 FERC ¶ 61,019 P 109. 
115 Id. 
116 IMM Answer at 27-28.

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satisfied and BGE customers would pay the maximum price 
for capacity as a result. 
 
Allowing capacity and load to be added without accounting 
for locational resource adequacy would also result in higher 
energy market prices and increased transmission costs. In the 
example, in the BGE LDA with higher load and lack of 
offsetting generation and transmission capacity to import 
power would result in higher prices in the energy market. 
This would trigger transmission upgrades. 
    
The Order wrongly dismisses these concerns in the RBP context even as it treated 
parallel concerns as significant to the BRA and as a reason to reject PJM’s IRAS proposal. 
The Order’s refusal to require locational procurement constraints in the RBP is thus an 
unexplained departure from precedent.117 While the IRAS decision postdates the RBP 
Order, the Commission on rehearing must explain why it dismissed the concern in the RBP 
context while crediting it in the IRAS context. 
The Order gestures at an argument that locational requirements are not needed 
because the RBP responds to an aggregate resource adequacy deficiency, not location-
specific needs. According to the Order, “the RBP is designed to address the PJM Region’s 
capacity shortfall, such that it is addressing an effectively region-wide problem.”118 But 
even assuming arguendo that this is correct, the Order’s failure to impose RBP locational 
constraints cannot be reconciled with the inclusion of locational constraints in the modeling 
for PJM’s RPM, which is likewise a region-wide procurement to ensure resource adequacy.  
Moreover, the Order’s characterization of RBP as responsive to aggregate region-
wide load growth is contrary to PJM’s characterization of its proposal, which makes crystal 
 
117 Encino Motorcars, LLC, 579 U.S. at 212-13. 
118 RBP Order P 97.

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clear that RBP is intended to address the enormous amount of projected load growth from 
new data centers that is outpacing new supply.119 
PJM hosts the largest concentration of data center load in the 
world.s “PJM’s load forecast predicts peak load growth of 
32 gigawatts [(“GW”)] from 2024 to 2030, 30 GW of which 
is projected to be from data centers.” Year-over-year, the 
shortfall of capacity supply needed to meet demand (plus a 
reasonable reserve margin) has grown despite a net increase 
of 1,294.4 MW Installed Capacity (“ICAP”) of supply 
between the 2027/2028 and 2028/2029 BRA. In other words, 
the addition of new supply has not kept pace with rapid large 
load demand growth, thus giving rise to the significant 
tightening of the capacity market in recent years and the 
subsequent resource adequacy shortfalls. To mitigate the 
potential reliability risks associated with resource adequacy 
shortfalls, PJM is proposing this RBP as a one-time, 
supplementary mechanism to procure additional supply to 
meet the resource adequacy needs of the PJM Region. 
And there is nothing mysterious about the locations of this load growth. Everyone knows 
where the new data center load has materialized within PJM and where it is projected to 
grow. And the RBP, in responding to this new large load growth, is addressing even more 
concentrated, location-specific load growth than the BRA generally does. If anything, the 
RBP context makes locational considerations more, not less, important, than they are in the 
BRA—a reality recognized by PJM’s proposal to allocate RBP costs to zones based on 
their large load forecasts.120  
The Order’s apparent contention that RBP is necessary to meet diverse aggregate 
region-wide load growth cannot be reconciled with its own statements to the contrary and 
the record evidence. The Commission accepts RBP, in part, because “PJM’s ordinary 
 
119 PJM Filing, Transmittal at 6-7 (footnotes omitted) (emphasis in original). 
120 “The initial allocation of RBP UCAP MW to each Electric Distributor zone/area will be based on Load 
Adjustments, as set forth in PJM Table B9b from the 2026 PJM Load Forecast, and each zone/area’s share 
of the Initial RBP Target of 6,831.3 MW.” Croop Aff. ¶ 46 (with chart of zonal allocations).

- 32 - 
 
instrument for procuring sufficient capacity to meet PJM’s reliability requirement, the 
RPM, has failed to keep pace with the unprecedented influx of large load into the PJM 
region in recent years.”121 In excusing RBP’s lack of locational constraints, the Order 
apparently ignores the transparent and compelling evidence that PJM’s resource adequacy 
shortfall is driven by new data center load and that load growth is projected to occur in 
specific zones within PJM. The Order itself states that “[t]he largest driver of the shortfall 
was 5,250 MW of load growth forecast for [the 2027/2028 Delivery Year], nearly 5,100 
MW of which was due to data centers.”122 The IMM has found that it is new data center 
load that is the causal driver of increased capacity prices within PJM.123 
While data center growth has occurred over five or more 
years, PJM has failed to address the impact of data centers 
on the PJM Capacity Market over the last four capacity 
auctions. PJM has made its RBP Filing only under direct 
pressure from the Commission and the White House and the 
PJM governors, among others. It is clear that the current 
situation and the current tariff in PJM are untenable and 
therefore unjust and unreasonable. The addition of data 
center load has resulted in adding $29.4 billion to the cost of 
capacity, higher energy costs, higher transmission costs, and 
a significant degradation of system reliability. 
 
The White House’s National Energy Dominance Council’s Statement of Principles 
Regarding PJM likewise points to new data center load as the causal driver of PJM’s 
resource adequacy needs and provides that “PJM should allocate the cost of any new 
capacity procured through the aforementioned Reliability Backstop Auction to load serving 
 
121 RBP Order P 29. 
122 Id. P 5. 
123 IMM Protest at 5.

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entities (LSEs) with new data centers that have not self-procured new capacity or agreed 
to be curtailable.”124 
  Contrary to the Order’s determination that the resource adequacy problem is 
region-wide, PJM has provided uncontroverted record evidence of the zones where new 
large loads are projected.125 Indeed, the Order recognizes the zonal nature of the problem 
in observing that126 
it may be just and reasonable for PJM to allocate RBP costs 
based on updated load forecast information. PJM could base 
the RBP allocation on the difference between the actual load 
for 2026/2027 delivery year in each Electric Distributor 
zone/area with the most recent 2028/2029 delivery year load 
forecast for each Electric Distributor zone/area. 
Finally, the Order seeks to defend the absence of locational constraints based on 
the “reasonabl[e] assum[ption] that RBP Resources will include anticipated Network 
Upgrade costs in their RBP Sell Offers.”127 This assumption is unfounded and stands 
reality on its head. Because RBP has no locational constraints, offering resources can bid 
regardless of where they are located and, in doing so, seek to avoid Network Upgrade 
costs—without regard to whether siting in that location will materially aid PJM in serving 
new large loads. Indeed, it is in the economic self-interest of offering resources to do so. 
Plainly, the Commission seeks to have PJM pay generators regardless of where they are 
located, with no assurance that these resources will meet the resource adequacy needs of 
LDAs with forecasted new large loads, while knowing that the failure to impose locational 
 
124 Statement of Principles at 1.   
125 Croop Aff. ¶ 46 (with chart of zonal allocations). 
126 RBP Order P 159. 
127 Id. P 97.

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constraints is likely to increase unnecessarily ratepayer capacity, energy, and transmission 
capacity costs. 
CONCLUSION 
WHEREFORE, for the foregoing reasons, Joint Consumer Advocates respectfully 
request that the Commission: (1) grant rehearing of the RBP Order; (2) find unjust and 
unreasonable the four elements of the RBP framework identified herein by Joint Consumer 
Advocates; and (3) direct PJM to incorporate changes to those elements in any subsequent 
FPA section 205 filing PJM proposes.   
Respectfully Submitted, 
   /s/ Susan L. Satter        
 
 
/s/ Scott H. Strauss 
Susan L. Satter 
Chief, Public Utilities Bureau 
Scott Metzger 
Public Utilities Policy Counsel 
Kimberly B. Janas 
Counsel to the Attorney General 
ILLINOIS ATTORNEY GENERAL’S OFFICE 
115 South LaSalle Street, 25th Floor 
Chicago, IL 60603 
susan.satter@ilag.gov 
 
Counsel for the Office of the Illinois 
Attorney General 
 
Scott H. Strauss 
Peter J. Hopkins 
Jeffrey A. Schwarz 
Lauren L. Springett 
SPIEGEL & MCDIARMID LLP 
1818 N Street, NW, 8th Floor 
Washington, DC 20036 
scott.strauss@spiegelmcd.com 
 
Counsel for Delaware Division of the 
Public Advocate, District of Columbia 
Office of People’s Counsel, Illinois Citizens 
Utility Board, Maryland Office of People’s 
Counsel and New Jersey Division of Rate 
Counsel 
October 29, 2026

CERTIFICATE OF SERVICE 
I hereby certify that I have this day caused the foregoing document to be served 
upon each person designated on the official service list compiled by the Secretary in this 
proceeding. 
Dated on this 29th day of October, 2026 
/s/ Lauren L. Springett 
Lauren L. Springett 
 
Law Offices of: 
SPIEGEL & MCDIARMID LLP 
1818 N Street, NW 
8th Floor 
Washington, DC 20036 
(202) 879-4000