FERC Docket No. ER26-3380-000 — Reliability Backstop Procurement
Status as of September 12, 2026. No FERC order has issued.
The short version
PJM Interconnection has asked federal regulators for permission to run a one-time capacity auction outside its normal market — a “Reliability Backstop Procurement,” or RBP — to buy roughly 6.8 GW of new generation that its regular auction failed to attract. The auction would pay up to $555 per MW-day, lock winners into contracts running 15 years, and bill the cost to utility zones across 13 states and the District of Columbia. Bidding is scheduled to open September 30, 2026. As of this writing FERC has not ruled, and consumer advocates in five jurisdictions have asked it to reject the plan outright.
The mechanism matters beyond its own dollar figure. It is the first concrete test of who pays for the generation that data center growth is driving — and PJM has explicitly declined to answer that question, handing it to the states.
Why PJM says it needs this
PJM’s capacity market — the Reliability Pricing Model — normally procures supply three years forward through an annual Base Residual Auction. The 2028/2029 BRA, held July 14, 2026, cleared 138,317.8 MW of unforced capacity at $325/MW-day RTO-wide. Every modeled zone cleared at the price cap, the third consecutive auction to do so. Counting Fixed Resource Requirement commitments, total procured capacity came to 149,181.6 MW — leaving the region 6,831.3 MW UCAP below its reliability requirement, or a 14.4 percent installed reserve margin against a 20 percent target. (PJM, 2028/2029 Base Residual Auction Report, July 14, 2026.)
That was the second consecutive shortfall. The 2027/2028 auction had missed by roughly 6.6 GW. PJM attributes the persistent gap to demand growth — principally data centers — outrunning new generation, compounded by a temporary price collar (a $175 floor and $325 cap, approved by FERC in April 2025) that limits how strong a price signal the market can send.
The political trigger arrived on January 16, 2026, when the White House National Energy Dominance Council and the governors of the 13 PJM states issued a joint Statement of Principles. It urged PJM to procure new capacity through a backstop auction commencing no later than September 2026, to provide “15-year price certainty for new capacity resources,” and to allocate the resulting costs to load-serving entities with new data centers that had not self-procured. PJM’s board picked this up the same day. In April, FERC Chairman Laura Swett said publicly she was “perplexed” that PJM had proposed holding the auction in March rather than September; the board moved the date up on May 19.
What was actually filed
PJM filed on July 31, 2026 under Section 205 of the Federal Power Act (accession no. 20260731-5214), proposing tariff and Reliability Assurance Agreement revisions. The core design:
Two tracks. A facilitated bilateral matchmaking process — an RFP issued June 9, 2026, responses due July 21, administered by Charles River Associates — lets large loads contract directly with new supply. Whatever that process delivers reduces the central auction’s target through “Qualifying RBP Offset UCAP MW,” avoiding double procurement. The central auction is the backstop for what bilateral deals don’t cover.
Price. A cap of $555/MW-day UCAP, against the standard $325 BRA cap. Clearing is pay-as-bid, structured as contracts-for-differences, with selection in least-cost order on levelized UCAP cost over the term.
Term. Fixed commitments up to 15 years, from the 2028/2029 delivery year through 2042/2043. Winners must be PJM capacity resources and take a $0 must-offer obligation into subsequent RPM auctions. Commercial operation deadline: June 1, 2032.
Geography. No locational constraints. PJM argues it cannot reliably model transmission deliverability 15 years forward, so the target is set RTO-wide rather than by zone.
Timeline. Bid window September 30 – October 21, 2026; selection October 22 – December 2; results December 2 — deliberately ahead of the 2029/2030 BRA opening December 9. PJM asked FERC to act by September 29, the 60-day statutory mark, and has said it will open the window September 30 if the framework is accepted by then. A participant training session was scheduled for September 14.
At the ceiling — the full 6,831.3 MW at $555/MW-day for 15 years — the arithmetic ceiling is roughly $20 billion. That figure circulates widely in trade coverage; it is a maximum, not a forecast, and actual exposure depends on how much bilateral contracting shrinks the target.
The contested piece: who pays
PJM allocates wholesale RBP costs pro rata to Electric Distributor zones. It then stops. Which customers within a zone bear the cost — data centers, or everyone — is a retail ratemaking question, and PJM’s filing points to the jurisdictional line drawn in FERC v. EPSA to explain why it is leaving that to state commissions. The board’s July 27 decisional letter framed the region’s central affordability question as how to allocate the cost of new investment, and said state action would be essential because PJM lacks jurisdiction to bill individual data centers directly.
This is the seam the fight is opening along. The governors’ principles asked for costs to land on data centers. PJM’s tariff cannot make that happen. If states don’t build the allocation frameworks in time, the default is that zonal costs flow to all customers in the zone.
Who is fighting it
Consumer advocates from Delaware, the District of Columbia, Illinois, Maryland and New Jersey filed a joint protest asking FERC to reject the proposal. Their argument runs on three tracks: PJM has not demonstrated the procurement is necessary; the design does not protect existing customers if the forecast data centers are delayed, cancelled or built elsewhere; and the 15-year term and $555 cap are both excessive — PJM has said five-year bilateral contracts could address the shortfall, and the cap is derived from a one-year cost of new entry despite PJM’s own acknowledgment that a 15-year lock improves financing.
The Maryland Office of People’s Counsel put a number on it: as much as $562 million in added Maryland costs over 15 years at the full target and maximum price. PJM’s initial allocation assigns Maryland’s two zones 135.4 MW — 116.5 MW to Potomac Edison, 18.9 MW to Baltimore Gas and Electric. (Inside Climate News, September 1, 2026.)
OPC is simultaneously working the state track, asking the Maryland PSC under the state’s Utility RELIEF Act to require peak-shaving participation from projected data center load, which could qualify utilities for an opt-out if reported to PJM by October 21. People’s Counsel David Lapp’s stated rationale is that waiting for FERC leaves the commission no room to act before the commitments are locked.
Two outside assessments in the same reporting are worth carrying: Abe Silverman of Johns Hopkins called the advocates’ objections substantial but expects FERC to approve the basic framework given support from the PJM governors and the Organization of PJM States, with changes at the margins. He also called OPC’s $562 million estimate reasonable — “The dollars are big, time is limited and the risk severe,” he said. Jon Gordon of Advanced Energy United made the schedule argument bluntly: absent near-total approval, there isn’t time to modify and still hold a September auction.
The parallel docket
PJM filed a companion proposal on August 13, 2026 — Interim Resource Adequacy Service, Docket ER26-3515-000, the renamed “connect and manage” framework, paired with a Large Load Registry. Under IRAS, certain new large loads that arrive without their own capacity and don’t obtain it through the RBP could be required to curtail when supply is short. That docket is drawing sharper industry opposition: the Electric Power Supply Association protested on September 3, 2026, arguing IRAS would discriminate between new and existing capacity resources and distort market signals. The two dockets are designed to interlock — participating in the backstop is meant to remove load from curtailment exposure — so an adverse ruling on either reshapes the other.
Where this sits in the larger redesign
The RBP is explicitly one-time. Whether PJM adopts a permanent two-tier structure — a base tranche clearing in the ordinary auction plus an incremental long-term tranche at a higher price — is the subject of PJM’s May 2026 market reform white paper, which floated three non-exclusive paths: long-term hedging with a marginal slice preserving investment signals; formal differential reliability tiers; or de-emphasizing capacity in favor of energy and ancillary revenues. Reform is expected to be contested before the next scheduled BRA in May 2027.
Dates to watch
| Date | Event |
|---|---|
| Sept 14, 2026 | PJM RBP participant training |
| Sept 29, 2026 | PJM’s requested FERC order date (60-day statutory mark) |
| Sept 30 – Oct 21, 2026 | Central procurement bid window; Oct 21 is also the opt-out reporting deadline |
| Dec 2, 2026 | RBP results finalized |
| Dec 9, 2026 | 2029/2030 Base Residual Auction opens |
| June 1, 2032 | RBP commercial operation deadline |
Verification status
Tier 1 (primary documents, publishable without caveat): Auction quantities, prices and reserve margins come from PJM’s own 2028/2029 BRA results report. Filing date, docket number, accession number, price cap, term, delivery-year range and bid-window dates come from the PJM transmittal letter filed July 31, 2026 and the July 27 board decisional letter, both on pjm.com. The governors’/NEDC principles language is quoted within the transmittal.
Tier 2 (single-sourced, credible, attributed): The Maryland cost estimate ($562 million), the zonal MW allocations (135.4 MW total), the composition of the joint protest, and the Silverman, Gordon and Lapp comments all trace to one story — Inside Climate News, September 1, 2026. Load-bearing for the “who’s fighting it” section; worth pulling the protest itself from OPC’s site or FERC eLibrary before publication. FERC Chairman Swett’s “perplexed” comment is from Utility Dive’s April 2026 open-meeting coverage.
Tier 3/4 (flag or verify before use): The ~$20 billion total-exposure figure appears in trade and aggregator coverage; it is arithmetically consistent with the target and cap but does not appear to be a PJM-published number. Treat as an analyst-derived ceiling. The prior-year (2027/2028) shortfall is variously reported as 6,623 MW and “approximately 6,500 MW” — the exact figure should be pulled from PJM’s 2027/2028 BRA report. One secondary source gives the 2028/2029 cleared reserve margin as 14.7 percent against PJM’s own 14.4 percent; PJM’s number is used here.
Open items — do not publish as settled:
- No FERC order as of September 12, 2026. The requested action date is September 29. Whether FERC accepts, accepts with conditions, sets the filing for hearing, or issues a deficiency letter is the single biggest unresolved fact in this piece.
- Complete intervenor and protest list unconfirmed. More than 30 parties had moved to intervene as of mid-August. FERC eLibrary was not queried directly for this draft; a full docket sheet for ER26-3380-000 should be pulled by hand before any claim about who did or didn’t protest.
- Whether generators or the Data Center Coalition protested the RBP (as distinct from IRAS, where EPSA’s protest is confirmed) is not established here.
- Bilateral matchmaking results. How many MW the CRA-administered process matched — and therefore how much the central target shrinks — was not public as of this writing. That number determines the real size of the auction.