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modrepub

(3,662 posts)
8. When The Proverbial Sh*t Hits The Fan
Tue Dec 31, 2024, 01:06 PM
Dec 31

and people in the MidAtlantic see their electric rates suddenly rise, the Republicans will seize on this to blame the Renewable Energy folks for causing all of this. And guess what, that's not what's causing the future auction rates to go up. Believe it or not, "it's complicated".

This has been building up for decades. Within the PJM grid, manufacturing has been moved overseas, average population has probably held steady, and many states (like PA) have deregulated the market. Thus, for a long time electric demand has been flat, the old coal plants that used to supply over 50% of the grid have become the high-cost electric producers (and most plants closed due to deregulation as too high-cost to run). A lot of combined cycle natural gas plants (feeding off the Marcellus Shale) have been built in the last 10 years as well as numerous solar and wind farms.

But the PJM process to replace the closing plants has been slow and cumbersome. Short story, there hasn't been enough new electric production to replace the high-cost coal plants that have closed. There are also choke points in the electric distribution system, often stymied by NIMBY opposition, that exasperate distribution and cause short-term price spikes. Add unplanned increases in electric demands from AI, data storage centers, and reshored manufacturing plus slow to act PJM bureaucracy and you have price spikes on the electric futures market.

Long (complicated) story short, there's about 100% probability that if you're in the PJM grid service area, your electric bill is going up in the next couple of years. Count on it.

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