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Pennsylvania New Jersey Maryland Interconnection
Practical Law Glossary Item 7-520-9897 (Approx. 3 pages)
Glossary
Pennsylvania New Jersey Maryland Interconnection
One of the seven regional transmission organizations (RTOs) or independent system operators (ISOs), the PJM manages the electric grid in all or part of 13 states: Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia (DC).
The PJM:
- Coordinates the movement of wholesale electricity in these states and DC.
- Ensures that enough electricity is being generated within its jurisdiction to meet customer demand.
- Maintains the integrity and reliability of the transmission grid and for managing changes and additions to the grid to accommodate new power plants, substations and transmission lines.
The PJM is one of the four RTOs/ISOs, together with ISO New England, MISO, and NYISO, that operates a capacity market. The PJM capacity market, called the Reliability Pricing Model (RPM), ensures long-term grid reliability by securing the appropriate amount of power supply resources needed to meet predicted energy demand in the future. The RPM is a series of auctions for a delivery year in the future. This auction is typically conducted three years in advance of a given delivery year.
The PJM also operates:
- An energy market which procures electricity to meet consumers' demands in real time and in the near term (one day forward).
- A financial transmission rights (FTRs) market which allows market participants to offset potential losses related to the price risk of delivering energy to the grid. FTRs are a financial contract entitling the FTR holder to a stream of revenues (or charges) based on the day-ahead hourly congestion price difference across an energy path.
- Several markets for ancillary services to help balance the transmission system as it moves electricity from generating sources to ultimate consumers. These include the Synchronized Reserve Market, the Non-Synchronized Reserve Market, the Day-Ahead Scheduling Reserve Market, and the Regulation Market.
For more information on PJM, see: