1. Andrew Ott, President & CEO PJM Interconnection
US Association for Energy Economics (USAEE) Tomorrow’s Grid and the Challenges Ahead
Andrew Ott, President & CEO PJM Interconnection

2. PJM as Part of the Eastern Interconnection
Key Statistics
Member companies
1,040+
Millions of people served 65
Peak load in megawatts
165,492
MW of generating capacity
178,563
Miles of transmission lines
84,042
2017 GWh of annual energy
773,522
Generation sources
1,379
Square miles of territory
243,417
States served
13 + D.C.
Hsia- Updated 2/2018
21 percent of U.S. GDP produced in PJM
As of Feb. 2018

3. Value Proposition
The value of PJM.

4. The Value of Markets: Lower Wholesale Rates
PJM’s wholesale electricity prices have declined 40 percent in the last decade.

5. Current State of the Grid
Deactivations
2017
2018 (YTD)
2,084 MW
186 MW
Current State of the Grid lead into the future. (PJM Future Challenges and Opportunities)
Value:
New economic generation
Transmission projects and upgrades
72,000 MW of
new competitive generation
online 2023
$16 billion in new transmission projects
13,358 MW* scheduled for future 2021 retirement
*5,605 MW for end of year 2018

6. PJM’s energy mix is more diverse than ever.
Current Energy Mix
PJM’s energy mix is more diverse than ever.
(% Annual Energy)

7. Ten Years of Fuel Mix Evolution
Here you see the trends throughout the past 10 years in the fuel mix.
Clearly you can see the major trend shift between gas and coal. You can also note that renewables are a growing area.
Fuel Security is a prominent matter that requires the upmost attention. Lead into PJM‘s Fuel Security Study.

8. Future Challenges/Opportunities
Changing Load Profiles
It’s no secret that the degree of change and the pace of change in the industry are unprecedented.
Physical changes (fuel mix) and Regulatory Uncertainty.,
Certainly, I’ve seen nothing like it in my career.
These are just some of the challenges we face.
<Mention each>
And I’ll talk about a few of them in more detail momentarily, but the point I want to make now is we have a choice:
Focus on Fuel Mix, Fuel Security and Regulatory Uncertainty. These challenges can either be treated as an endless parade of obstacles, or we can look for the opportunities that are within each of them like the value of new attributes (Emission, State Renewable Initiatives)
PJM is uniquely able to leverage challenges into opportunities and then into value for our members and the region we serve.
Changing Fuel Mix
Regulatory Uncertainty
Fuel Security
Renewable and Distributed Energy Resource Integration
Cybersecurity and System Resiliency

9. Fuel Security

10. Trajectory to Tomorrow’s Grid
THEMES
INITIATIVES
MARKET DESIGN INITIATIVES – Price Formation, Valuing potentially other essential resource attributes into the future. Value resilience through markets
RESILIENCE INITIATIVES – Cyber Security and Fuel Security
DER – Over the past year, we have engaged over the with our stakeholders under our DER Senior Task Force to harmonize the need and concerns of DER, EDC and the impact to system operations.
PJM Confidential