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Fix the energy market
Draft

PJM-style Locational Marginal Pricing

A centrally optimised nodal market in which wholesale prices reflect marginal energy cost, transmission congestion and losses, supplemented by capacity and ancillary-service markets.

Solution section

Roadmap & Implementation

Institutions, infrastructure, transition requirements and practical implementation.

Roadmap & Implementation

A PJM-style architecture requires:

  • detailed transmission-network models;
  • high-quality telemetry;
  • security-constrained optimisation;
  • nodal settlement;
  • participant bidding infrastructure;
  • congestion hedging;
  • market monitoring;
  • capacity and ancillary arrangements.

For Great Britain, implementation would be a major market redesign involving settlement, contracts, hedging, dispatch and institutional transition.