Keeping Power Flowing to 65 Million Consumers
Andrew Ott is the president and CEO of PJM Interconnection. PJM coordinates and directs the operation of the region’s transmission grid, which includes over eighty-two thousand miles of transmission lines. PJM administers a competitive wholesale electricity market and plans regional transmission expansion improvements to maintain grid reliability and relieve congestion.
Twenty years ago, on April 1, 1997, PJM inaugurated the nation’s first competitive wholesale electricity market, setting the stage for what would become the industry standard.
Today, we celebrate two decades of having achieved our mission with that market construct: maintaining reliability at the lowest reasonable cost. PJM’s regional coordination of wholesale electricity movements saves 2.8-3.1 billion dollars each year for the sixty-five million consumers it serves in thirteen states and the District of Columbia.
PJM utilities had already been discussing replacing a power pool with a competitive energy market in 1996. That’s when the Federal Energy Regulatory Commission issued Order 888, in part opening transmission lines to competitors and non-incumbent entities with the goal of inciting competition in the bulk power marketplace.
PJM’s first bid-based market operated with a single clearing price, but was quickly refined to align locational prices with corresponding grid conditions.