Natural gas is outpacing coal and wind when it comes to new sources of electricity for a 14-state region that includes Pennsylvania. PJM Interconnection coordinates the wholesale electricity market and manages transmission for an area that stretches from Illinois to New Jersey, and Pennsylvania to North Carolina, including the District of Columbia.
PJM conducts a yearly “capacity auction” that insures enough electricity will be available three years into the future. This year’s auction, which concluded in May, established contracts with power suppliers for June 2016 through May 2017.
“It’s a continuation of what we observed last year in 2012,” said PJM spokesman Ray Dotter. “What we’re seeing is gas playing a growing role and coal playing a smaller role [in the region’s electricity generation.] It’s a big change and a pretty rapid change.”
Dotter says two years ago, wind energy would have made up more new sources of energy. He says PJM attributes the shift to the increased production of shale gas, which is less expensive, and is in such close proximity to the end users.
He says almost 10,000 megawatts of coal-generated electricity did not “clear” the auction, meaning that it was not cost competitive with other sources offered. It’s important to note that coal still continues to provide the bulk of electricity for both Pennsylvania and the PJM region.
As coal fired plants retire, Dotter says the region remains in good shape regarding capacity.
“So there wasn’t a hiccup to replace the [retired coal generated electricity] with wind and gas,” he says.