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Natural Gas to Surpass Coal as PJM's Top Source Fuel in May

The head of PJM Interconnection, the regional transmission organization (RTO) responsible for moving electricity over most of the Mid-Atlantic and parts of the Midwest, said natural gas is on pace to surpass coal as its primary source fuel by May 2015.

Terry Boston, CEO of PJM, said the RTO's current fuel mix is 40% coal, 30% natural gas, 19% nuclear and 11% other, which includes renewables. But he said those percentages were changing as the power industry shifts toward natural gas.

"We're facing a big change from the normal pace at which the grid evolved," Boston told attendees of the PJM Grid 20/20 conference in Washington, D.C., on Tuesday. "Looking back 80 years, typically it has taken a decade for a new fuel to emerge as a major source of generation. This myopic focus on one fuel source per decade has resulted in something very important for reliability -- a diverse mix of fuels in PJM.

"Next May, for the first time ever, we will see natural gas surpass coal in our fuel mix."

FERC Chairman Cheryl LaFleur delivered the keynote address at the conference Tuesday. In a statement by PJM, LaFleur said competitive energy markets, including RTOs such as PJM, have "for the most part...done a good job attracting new generation, based on what markets were designed to do. Nationally we are at a key point in the development of electricity markets."

According to PJM, LaFleur added that the Federal Energy Regulatory Commission has issued many orders in the last several years, part of an effort by regulators to "make sure new resources can fairly participate in electricity markets...It's difficult work to look at these complex structures, but it's important to get markets right."

PJM covers the power grid in all or part of 13 states -- Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia and West Virginia -- plus the District of Columbia, and serves 61 million customers. The grid includes 62,556 miles of transmission lines. PJM is also responsible for administering a competitive wholesale electricity market, and it plans regional transmission expansion improvements to maintain grid reliability and relieve congestion.

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