Last quarter, PJM paid a record $1B to cash-strapped power plants. (Reuters)
The bitter cold sent fuel costs skyrocketing, but plants had to keep on running—a huge financial hit ensued. In January, spot gas prices reached “historic” levels in the Eastern US: Many hubs traded over $100/mmBtu (compared with an average of <$8 that month).
That’s why PJM’s power plant uplift payments totaled $990M last quarter. Meanwhile, these payments reached $764M for all of 2025 (a year that saw record demand and a winter polar vortex).
The big picture: PJM is increasingly susceptible to brutal cold, not to mention a whole host of grid threats. And as a capacity shortfall looms, things won’t exactly get easier.