{"id":376831,"date":"2025-04-30T14:41:00","date_gmt":"2025-04-30T12:41:00","guid":{"rendered":"https:\/\/climatescience.press\/?p=376831"},"modified":"2025-04-30T14:41:02","modified_gmt":"2025-04-30T12:41:02","slug":"shapiro-price-cap-could-hike-electricity-bills","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=376831","title":{"rendered":"Shapiro \u2018Price Cap\u2019 Could Hike Electricity Bills"},"content":{"rendered":"\n
\"\"<\/figure>\n\n\n\n

<\/p>\n\n\n\n

From Watts Up With That?<\/a><\/p>\n\n\n\n

By Gordon Tomb<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Gov. Josh Shapiro\u2019s proposal to cap electricity prices could, perversely, lead to higher customer bills and a greater risk of blackouts, according to America\u2019s Power, a trade organization of coal-fired power plants.<\/p>\n\n\n\n

Following negotiations with the governor, power grid operator PJM Interconnection submitted a plan to the Federal Energy Regulatory Commission (FERC) to restrict prices for two years\u2014a period that would extend, coincidentally or not, beyond Shapiro\u2019s 2026 reelection campaign. On April 22, FERC approved<\/a> the settlement.<\/p>\n\n\n\n

As usual, the governor ran a premature victory lap<\/a>. Shapiro called<\/a> a $14.7 billion boost in electricity costs last year the \u201clargest unjust wealth transfer in the history of U.S. energy markets.\u201d The price cap would provide nearly $22 billion<\/a> in savings, the governor claimed.<\/p>\n\n\n\n

However, the higher prices at last year\u2019s PJM auction resulted from the rising demand for electricity and a shortage of producers willing to offer new supplies. The auctions are intended to replicate a market where prices rise and fall with the differential between supply and demand.<\/p>\n\n\n\n

In a protest filed with FERC, America\u2019s Power stated<\/a> the PJM \u201cproposal to appease Gov. Shapiro may superficially sound attractive as a way to help consumers during tumultuous economic times, but that is merely its aura, not its reality.\u201d The trade group raises the specter of \u201ccatastrophic consequences\u201d from PJM\u2019s \u201cgame of reliability Russian roulette.\u201d<\/p>\n\n\n\n

America\u2019s Power may sound hyperbolic. But in the context of more than 200 deaths<\/a> in Texas from blackouts due to a lack of reliable generation and fuel<\/a>, lawmakers must take the trade group\u2019s cautionary words seriously.<\/p>\n\n\n\n

Other organizations have issued the same warning.<\/p>\n\n\n\n

\u201cThe governor\u2019s proposal is dangerous because it numbs the market to price signals, which is how investment in new generation capacity is directed,\u201d said David Taylor, CEO of the Pennsylvania Manufacturers\u2019 Association. \u201cIn doing so, he would damage an already compromised electricity market, further undermine grid reliability, and potentially get people killed when the power goes out.\u201d<\/p>\n\n\n\n

Overseeing the electricity transmission across 13 states, PJM has issued multiple warnings of power shortages in the region within the next few years. Those warnings result partly from the forced closure of coal-fired plants by regulations and wind and solar subsidies augmenting the market. Instead of attracting new energy sources, the price cap would accelerate the shutdowns of highly reliable coal-fired plants that can keep months of fuel supplies on-site for emergencies, according to America\u2019s Power.<\/p>\n\n\n\n

Because their operations are weather-dependent, wind turbines and solar panels cannot match the reliability of units fueled by coal, natural gas, or nuclear energy. As more reliable facilities retire, most new proposals to PJM call for new generation from wind and solar operators.<\/p>\n\n\n\n

PJM, said America\u2019s Power, has sacrificed its role as a market manager in yielding to Gov. Shapiro\u2019s complaint: \u201cPJM, disappointingly bowing under the weight of state-imposed political pressure rather than standing up to protect market integrity and reliability, submitted a proposal that may lead to catastrophic consequences.\u201d<\/p>\n\n\n\n

Let\u2019s be clear: The negotiated price cap does not save money; it only limits cost increases.<\/p>\n\n\n\n

\u201cRates will continue to rise even under this agreement,\u201d said<\/a> state Sen. Joe Pittman.<\/p>\n\n\n\n

In other words, Shapiro\u2019s intervention will likely prolong the period of rising prices. If the governor continues his war on reliability with carbon taxes and enhanced subsidies for unreliable energy sources, the gap between demand and supply will increase prices even further.<\/p>\n\n\n\n

The lack of new reliable generation could force PJM to use expensive \u201creliability must-run<\/a>\u201d agreements. These agreements enable plants shutting down for economic reasons to continue to run by compensating them at relatively high prices, according to America\u2019s Power.<\/p>\n\n\n\n

In short, bad state policies limit electricity supply and drive up your utility bills. The PJM settlement will exacerbate this problem<\/a>.<\/p>\n\n\n\n

Power shortages are of particular concern in winter or summer when extreme temperatures pose significant risks to people. In addition, price spikes are more likely during cold spells when home-heating demands compete with power plants for natural gas. During a January polar vortex, coal plants potentially avoided as much as $1.4 billion in increased costs and provided more than 40 percent of the additional energy needed to warm homes and businesses, America\u2019s Power claimed.<\/p>\n\n\n\n

The FERC-approved Shapiro\u2013PJM settlement boils down to one question: What good are lower prices if there is no electricity when it\u2019s most needed?<\/p>\n\n\n\n

This commentary was first published at DV Journal<\/a> on April 28th, 2025.<\/p>\n\n\n\n

Gordon Tomb<\/a> is a senior advisor with the <\/em>CO2 Coalition<\/em><\/a>.<\/em><\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Gov. Josh Shapiro\u2019s proposal to cap electricity prices could, perversely, lead to higher customer bills and a greater risk of blackouts, according to America\u2019s Power, a trade organization of coal-fired power plants.<\/p>\n","protected":false},"author":121246920,"featured_media":376833,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_coblocks_attr":"","_coblocks_dimensions":"","_coblocks_responsive_height":"","_coblocks_accordion_ie_support":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[1],"tags":[691824598,691824443,691821521,691826197,691834833,691818728],"class_list":["post-376831","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","tag-coal-fired-plants","tag-electricity-bills","tag-federal-energy-regulatory-commission-ferc","tag-pennsylvania-gov-josh-shapiro","tag-regulations-and-subsidies","tag-wind-and-solar","fallback-thumbnail"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2025\/04\/0c68f0635-1768-4414-837c-80afc03f3113.png?fit=1024%2C1024&ssl=1","jetpack_likes_enabled":true,"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/paxLW1-1A1V","jetpack-related-posts":[{"id":241274,"url":"https:\/\/climatescience.press\/?p=241274","url_meta":{"origin":376831,"position":0},"title":"In Pennsylvania, Will Josh Shapiro Unlock Decades of Affordable Energy?","author":"uwe.roland.gross","date":"01\/24\/2023","format":false,"excerpt":"With Democrat Josh Shapiro as a newly inaugurated governor and a new legislative body, Pennsylvania will either shine as an energy superstar or continue down the dim path of economic decline.","rel":"","context":"Similar post","block_context":{"text":"Similar post","link":""},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-1036.png?fit=1200%2C656&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-1036.png?fit=1200%2C656&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-1036.png?fit=1200%2C656&ssl=1&resize=525%2C300 1.5x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-1036.png?fit=1200%2C656&ssl=1&resize=700%2C400 2x, https:\/\/i0.wp.com\/climatescience.press\/wp-content\/uploads\/2023\/01\/image-1036.png?fit=1200%2C656&ssl=1&resize=1050%2C600 3x"},"classes":[]},{"id":294666,"url":"https:\/\/climatescience.press\/?p=294666","url_meta":{"origin":376831,"position":1},"title":"Are \u2018Green\u2019 Agendas Carrying Governors to Political Cliffs?","author":"uwe.roland.gross","date":"01\/12\/2024","format":false,"excerpt":"Pennsylvania Gov. 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