Letter to the editor: PJM capacity auction proves markets work

As discussions around the recent PJM capacity auction results continue, it’s vital to recognize what these outcomes truly signal: the competitive market is functioning effectively, responding to rising demand and securing grid reliability.

The 2026-27 base residual auction procured over 134,000 megawatts (MW) of capacity, enough to serve 67 million people across 13 states and D.C. This marks the first auction in four years to see a net increase in new generation. The addition of 2,669 MW and reversal of 1,100 MW of planned retirements further show that market signals are spurring investment and supporting grid stability.

This positive trend — with new generation added, existing resources preserved and retired capacity brought back — is undeniable. Yet a critical challenge remains: tightening supply, as demand is projected to surge by 5,400 MW for 2026-27, driven by data centers, electrification and economic growth.

PJM is addressing this by working through its interconnection queue backlog, with over 60% already processed. These efforts, along with recent announcements to add significant generation for data centers and strengthen the grid, are steps in the right direction.

However, policy support from elected officials and regulators is crucial to ensure new projects come online swiftly. Instead of undermining competitive markets, policymakers should partner with the private sector to remove barriers that hinder project development, supporting new investments and a reliable, affordable power supply for the decade ahead.

Glen Thomas

Malvern

The writer is president of PJM Power Providers Group (P3).