Five Democratic governors are calling on the nation’s largest grid operator, PJM Interconnection, to change the process it uses to determine the price paid to power plants after record prices were awarded at its latest auction.

In a joint letter to PJM last week, Govs. John Carney of Delaware, J.B. Pritzker of IllinoisJosh Shapiro of Pennsylvania, Wes Moore of Maryland and Phil Murphy of New Jersey urged the grid manager to take urgent action after its latest capacity auction in July for 2025 and 2026 saw prices 833% higher than the previous year, citing a decline. supply and increased demand.

The governors said the capacity auction results would cost homes and businesses in the 13 states and the District of Columbia served by PJM $14.7 billion.

“Urgent action is needed to prevent customers from paying billions more than necessary,” the group said.

Illinois Governor JB Pritzker attends the Clinton Global Initiative 2024 Annual Meeting at the New York Hilton Midtown on September 24, 2024 in New York. Pritzker joined four other Democratic governors in calling on the PJM to make several changes after the (John Nación/Getty Images)

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The governors asked PJM to increase the number of power plants participating in its auctions to increase the available supply calculations used to determine prices and to encourage more renewable energy. energy production and lowering the cap on capacity prices, among other demands.

Democratic governors in five states are pressuring PJM to make changes after the grid manager’s latest capacity auction resulted in record prices paid to power plants.

The prices have raised concerns about rising electricity bills for everyday homes and businesses in the grid manager’s territory, and have led environmental groups — including the Sierra Club, Earthjustice and the Council Natural Resources Defense – to file a complaint against PJM’s process for determining its prices.

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PJM has asked regulators to delay its 2026/27 auction by about six months to respond to the complaint filed against it. The group of governors said it supported the delay.

The network manager stated that he had continually warned that government policy Measures to abandon electricity generation from fossil sources, before adding new clean electricity generation, could lead to a supply crisis.

A wind turbine spins in rural Lee County on March 27, 2024, in Illinois. Grid operator PJM says it has repeatedly warned that moving away from generating electricity from fossil fuels before developing more clean energy sources would lead to supply shortages. (Stacey Wescott/Chicago Tribune/Tribune News Service via Getty Images / Getty Images)

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“Our state leaders are critical voices and we appreciate their input as we work to balance the need for an investment signal for the next generation with the need to keep prices affordable for consumers,” said the PJM spokesman Jeff Shields in an email to Reuters. “Our states also play a critical role in the policy choices they make that have a direct supply and demand impact on our system,” he added.

Reuters contributed to this report.