Shapiro’s electricity proposals threaten state’s role in regional transmission, says alliance

Alongside the growing reliance on electricity from Pennsylvania’s PJM Interconnection, Gov. Josh Shapiro’s electricity proposals could further destabilize the PJM grid, which supplies power to 65 million people and more than 20 percent of the U.S. economy, according to a newly released report from Pittsburgh Works Together (PWT).

Concurrently, fossil fuel plants are being forced to close down when fossil fuels and nuclear power now provide nearly all the power (92 percent) in the PJM grid, according to the PWT report, The PJM Grid in Peril: What Will Keep the Lights On?

Additionally, many PJM states do not produce enough electricity to meet their own demand and must rely on states like Pennsylvania for their energy needs, further straining the PJM grid.

“Only four states on the PJM grid are exporting states — Pennsylvania, Illinois, Michigan, and West Virginia,” PWT Executive Director Jeff Nobers told Pennsylvania Business Report. “Pennsylvania exports 80,244,671 megawatt hours, more than the other three exporting states combined. Pennsylvania is critical to keeping the lights on in Pennsylvania and the vast majority of the PJM grid.”

Combined with the fact that there’s insufficient development of new reliable generation, PJM itself has predicted a potential supply shortage by 2030, according to PWT, an economic development alliance of business and organized labor locals.

Pennsylvania is the central part of PJM because without Pennsylvania and the electricity it provides to neighboring states, the PJM grid doesn’t work, the report says.

“Pennsylvania generates roughly one-third of the electricity produced in PJM, which means it directly powers about 7 percent of the country’s GDP. As such, what happens in Pennsylvania will have an impact far beyond our borders,” the PWT report says. “Gov. Shapiro has proposed sweeping new energy legislation that would reshape Pennsylvania’s power generation sector.”

The governor’s proposals could disrupt PJM operations in two ways: by charging a tax on Pennsylvania’s fossil fuel plants based on their generation, making them more expensive to operate; and by requiring the sale of far more wind, solar, and other alternative-energy generated power to Pennsylvania customers, according to the report.

For instance, PWT says the proposed Pennsylvania Climate Emissions Reduction Act (PACER) would tax the state’s fossil-fuel power plants based on their production, the goal being to discourage carbon emissions and to raise money to finance new power projects with lower carbon emissions.

“The immediate impact would be to make the fossil-fuel plants more expensive to run, potentially reducing their production or pushing them into early retirement,” the report says.

“Pennsylvania, like many other states — both PJM states and non-PJM states — have gone down a path of establishing a goal to eliminate the use of fossil fuels for electricity generation,” Nobers said. “They have done this without having a true plan in place, with reliable generation sources to replace the generation we are losing.”

At the same time, these policies have and will inhibit investment in these plants, he added, saying: “We are staking the reliability of the grid and our economic health on technologies that have reliability issues and in some cases on technologies that don’t even exist today.”

Additionally, the proposed Pennsylvania Reliable Energy Sustainability Standards (PRESS) Act would replace the existing Alternative Energy Portfolio Standard (AEPS) to de-emphasize some of the carbon-producing fuels now eligible, such as waste coal and garbage, PWT says.

The bill also would impose a greater requirement on the sale of wind, solar, and other non-carbon electricity to Pennsylvania consumers than the current AEPS, and would require that 35 percent of the power sold in Pennsylvania in 2035 come from a Tier I group that includes wind, solar, geothermal, advanced nuclear reactors, and methane from landfills and coal mines that is otherwise escaping untouched into the atmosphere, according to the report.

Currently, PWT says, just under 7 percent of the electricity sold in Pennsylvania meets the proposed new Tier I definition. To comply with the proposed PRESS legislation, that total would have to double by June 1, 2026, and jump fivefold by 2035 to 35 percent. By 2030, 10 percent of those Tier I sources would have to be located within Pennsylvania.

“If wind and solar are primarily used to satisfy that requirement, that would mean wind and solar production, which was 1.6 percent of Pennsylvania generation in 2022, would have to increase by 600 percent over the next six years,” the report says.

And while PJM has said it has authorized 38,000 megawatts worth of new projects to connect to the grid, mostly wind and solar, those projects aren’t getting built, largely due to a lack of financing, supply chain issues, and permitting delays.

PJM also has said that if this development doesn’t pick up, then there will be a shortfall in supply by the end of this decade or sooner.

“As in other states that have made pronouncements or established ‘clean’ energy goals and programs we already see many coal fired and older gas fired generation plants closing,” Nobers explained. “The issue is not so much the goals and objectives, it’s the fact that we are losing generation capacity because of these pronouncements.”

Yet among the primary replacements, he said, wind and solar are not 24/7 reliable and do not work just anywhere.

“In Pennsylvania and other states there’s a heavy reliance on emerging technologies or even those that don’t exist today,” he said. “That’s a huge, huge gamble.”

PWT says that there are alternative options.

“We believe in an all-of-the-above energy strategy,” said Nobers. “There’s a place in the generation mix for wind and solar and gas and nuclear, hydro and even coal. The natural progression of technology and market dynamics should be what determines our generation mix, not the government picking winners and losers.”

The most basic alternative, he added, is common sense and the realization that electric generation cannot be transformed away from fossil fuels in the next 10, 20, or 30 years.

“It will be decades if not a century or more,” said Nobers. “We need to have reliable, assured replacement generation. Cogeneration plants, small footprint nuclear plants, more technologically advanced gas plants.

“We need to get away from this notion that incremental steps are bad and that we can just make this switch with no consequences,” he added.

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