The 2028/2029 PJM Base Residual Auction (BRA) results were largely consistent with the previous two auctions, with clearing prices remaining relatively unchanged despite ongoing market challenges. Total cleared capacity increased by 3,733 MW compared to the 134,585 MW cleared in December, while the amount of supply offered into the auction rose by 3,447 MW. The auction also secured 525 MW of new generation resources, reflecting continued efforts to bring additional supply into the market.

Despite these gains, PJM still fell 6,831 MW short of its reliability target, highlighting the ongoing imbalance between supply and demand. To address this concern, PJM plans to seek FERC approval for a “backstop procurement” in September to review the shortfall and strengthen reserve margins. While the shortfall does not indicate an inability to serve load reliably, it does suggest that reserve levels remain thin and carry an elevated level of risk.

Moving Forward

Attention is now shifting to the next Base Residual Auction, scheduled for December 9, 2026, which will establish capacity prices for the 2029/2030 delivery year. This auction will be the final one conducted under the current price ceiling and floor framework established by PJM, FERC, and participating states to help reduce market volatility.

Beginning in May 2027, PJM is expected to return to its traditional auction schedule with the 2030/2031 BRA. While the current price cap mechanism has helped moderate costs in recent auctions, market participants continue to monitor underlying supply and reliability challenges. As a result, capacity costs in future auctions, particularly the 2030/2031 BRA, could be significantly higher if additional generation resources are not added to the system.