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CUB Q and A: Another capacity auction, more bad news–so what happened?

Jim Chilsen — Thu, 31 Jul 2025 23:43:19 +0000

By Clara Summers Manager, CUB’s Consumers for a Better Grid Campaign You may have seen a flurry of news about electric bill increases due to something called a “capacity auction.” Or worse, you opened your June ComEd bill and saw a sharp uptick. You can learn more about PJM’s capacity market and this year’s price spike in our previous blog, and by visiting our Help Center. Sadly, there’s more bad news. Prices are going up yet again–next June. Let’s break it down. So what’s happening to ComEd bills? The price spike we are experiencing now was set in stone last July. That’s when PJM held its auction for 2025/2026 to determine what we pay for reserve electricity, or capacity. It was bad enough when prices reached record highs for that auction, but PJM just set another record for its 2026/2027 auction, which will go into effect on June 1, 2026. The auction price jumped 22 percent, increasing from $269.92 per Megawatt-day to $329.17 per MW-day. That doesn’t mean your bill will go up 22 percent–capacity is only one component of ComEd’s supply price for electricity–but it does mean your bill will increase.* ComEd initially said bills will go up by about 2 percent next year–on top of the spike consumers are feeling now–but we won’t know final estimates until sometime next May. Did anything change since the last auction? After last year’s devastating auction results, advocates sprung into action. Environmental organizations filed a complaint at the Federal Energy Regulatory Commission (FERC) about how PJM made ratepayers pay extra for otherwise retiring coal plants, but then ignored them in the capacity auction, falsely reducing supply. Consumer advocates supported that complaint and added our own, where we argued, among other things, that PJM wasn’t counting the contribution of many renewables either. PJM changed its rules for the better in response to these complaints. Gov. Shapiro of Pennsylvania also brought a complaint to FERC, saying that the normal price cap of $500 per MW-day should be lowered until the interconnection queue starts working again. (Remember, a major factor for these high prices is PJM’s interconnection queue delay). PJM and Gov. Shapiro agreed on a regional price cap of $329.17 per MW-day for the next two auctions. While there were other parts of the agreement that raised consumer advocate concerns, we supported the price cap. The most recent auction, setting prices that will take effect next June, hit the price cap negotiated by Gov. Shapiro. PJM did an analysis of what the clearing price would have been without the new price cap, and holding all else equal, the price cap saved consumers an estimated $2.9 billion. As a consumer advocate, we are relieved that there was a price cap that protected ratepayers from even worse outcomes, but are still frustrated that we got here in the first place. Why is the capacity price going up even more? Significant increases in demand, combined with a restriction in supply (the frozen interconnection queue), cause prices to go high. The biggest contributor to the price spike in this auction was large loads, such as data centers. They […]

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CUB Q&A: Why is ComEd’s electricity price spiking?

Jim Chilsen — Fri, 09 May 2025 09:20:05 +0000

A record price spike in an electricity “capacity auction” has caused Commonwealth Edison’s electricity price to increase significantly from June 2025 through May 2026. ComEd estimates this could cost customers an extra $10.60 per month, on average, over 12 months. Read CUB’s Q&A below and visit CUBHelpCenter.com for more information. What happened? In 2024, power grid operator PJM Interconnection announced the results of its capacity auction (technically referred to as the “Base Residual Auction”). This auction is how the grid operator secures reserve power in a vast region that stretches from the Midwest to the East Coast and includes ComEd’s territory in northern Illinois. In that auction, covering the 12-month period from June 2025 through May 2026, prices for most of PJM jumped about 830 percent, from $28.92 per Megawatt-day in last year’s auction to a record $269.92 per MW-day. The prices were even higher in two eastern sections of PJM: The Baltimore Gas and Electric (BGE) zone in Maryland ($466.35 per MW-day) and in the Dominion zone in Virginia and North Carolina ($444.26 per MW-day). [Update: Since this blog was written, another capacity auction has been held to determine the capacity cost for 2026-2027. Unfortunately, the auction produced another record-high price: $329.17 per MW-day. Read CUB’s statement and our new WatchBlog article on what happened.] What exactly are capacity costs? Not only do you pay for the power you use now, but you also pay for power you could use in the future. Capacity refers to extra payments consumers give power plant operators for the commitment to have enough reserve electricity available if demand suddenly spikes. (Think of a hot summer afternoon, when everyone blasts the AC.) Normally, PJM holds annual auctions to secure capacity prices three years in advance. But PJM got off schedule years ago and July’s auction set the capacity price for the following June, only 11 months in advance. This compressed auction schedule has contributed to PJM’s problems. Where does a capacity price increase appear on my bill? An increase in capacity prices will affect the supply section of your ComEd bill. For most customers, capacity costs are buried in ComEd’s per-kilowatt-hour (kWh) supply price–it’s one component of the price, typically accounting for roughly 20 percent of supply. (The exception is if you’re a customer of ComEd’s Hourly Pricing program–which charges you a supply price that can change hourly. Hourly Pricing customers see capacity as a separate line item on bills.) How much has an increase in capacity costs increased ComEd bills? ComEd’s supply price before June 2025 was just under 7 cents per kWh. Then, it shot up to about 10.03 cents per kilowatt-hour (kWh). As of October 2025, the price was about 9.689 cents per kWh, which is about 47 percent higher than last October. ComEd says the spike will increase bills by an average of $10.60 a month over the next 12 months, or 10 to 15 percent, but the actual increase could run a lot higher depending on actual usage and weather. After a summer heat wave, some customers reported triple-digit increases in their ComEd bills. Hourly Pricing customers, who have […]

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