PJM Interconnection LLC (PJM) is a regional transmission organization (RTO) in the United States. It is part of the Eastern Interconnection grid operating an electric transmission system serving all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.
PJM, headquartered in Valley Forge, Pennsylvania, is currently the world's largest competitive wholesale electricity market. More than 900 companies are members of PJM, which serves 61 million customers and has 183.6 gigawatts of generating capacity. With 1,376 generation sources, 62,556 miles (100,670 km) of transmission lines and 6,038 transmission substations, PJM delivered 791 terawatt-hours of electricity in 2013.
Started in 1927, the pool was renamed the Pennsylvania-New Jersey-Maryland Interconnection (PJM) in 1956. The organization continues to integrate additional utility transmission systems into its operations.
In 1927 the Public Service Electric and Gas Company, Philadelphia Electric Company, and Pennsylvania Power & Light Company formed a power pool called the Pennsylvania-New Jersey Interconnection. The purpose of the power pool was to dispatch electric generating plants on a lowest cost basis, thereby reducing the electric costs for all members of the pool.
1997 FERC Order 880, 888 and 889
Following the Federal Energy Regulatory Commission (FERC) Order 880 that began the deregulation of the traditional utility companies, FERC began to set up the concepts of an Independent System Operator (ISO) which allowed third party entities to manage functions of the electric grid that were traditionally responsibilities of vertically integrated utility companies. PJM became an ISO in 1997.
Later, FERC encouraged the establishment of Regional Transmission Organization (RTO), to operate multi-state transmissions projects. PJM was designated an RTO by the FERC in 2001.
FERC regulates PJM and approves its open access transmission tariff for the wholesale electricity market.
Deregulation and expansion, 2002
In April 2002, Allegheny Power (AP) was the first external control area to join the PJM RTO as a market participant; "PJM Classic" and AP operated as a single control area, filling the roles of balancing authority, interchange authority, market operator and transmission operator.
The Northeast Blackout of 2003
During the Northeast Blackout of 2003, the transmission systems within the PJM operations area largely remained operational and were not affected by the power failure. When the grid separated, a small portion of the Public Service Electric & Gas of New Jersey zone electrically separated from the Eastern Interconnection due to over-frequency relay operations.
Deregulation and expansion, 2004-present
In May 2004, Commonwealth Edison (ComEd) joined PJM as a separate balancing authority operating under the RTO. PJM was able to manage the two territories in a single market by a mechanism known as "the pathway", a set of firm contracts that transferred energy from ComEd through third party control areas to the eastern PJM markets and beyond. In October 2004, American Electric Power (AEP) and Dayton Power & Light (DPL) joined PJM, which allowed PJM to collapse back into a single control area.
In January 2005, Duquesne Light Co. (DLCO) joined PJM. In May 2005, Dominion Virginia Power joined PJM, extending the southern border to North Carolina. FirstEnergy was added to PJM in June 2011, expanding the footprint across northern Ohio to the Michigan border. Areas of Ohio and Kentucky near Cincinnati covered by Duke Energy joined the PJM footprint in January 2012. At this time, PJM now borders 22 balancing authorities representing eleven market interfaces.
Transmission system planning and upgrades
PJM uses a fifteen-year planning horizon for planning transmission system upgrades. Under PJM's Regional Transmission Expansion Planning (RTEP) process, PJM considers forecasts of load growth and additions of demand response, interconnection requests for new and planned retirements of existing generating plants, and possible solutions to mitigate congestion on the transmission system. If the upgrade involves the construction of a new transmission line, local siting decisions involving the route of the new line are determined by the owner of the line and the state government.