This quarter's PJM forecast release includes three scenarios rather than just the Central Case. Modo Energy has released a High Renewables and a Low Demand scenario to provide a range of potential outcomes for battery energy storage system (BESS) owners.

A four-hour battery at the PJM zone average earns $84k/MW-year from 2027 to 2049 in the Central Case, $91k/MW-year under High Renewables, and $72k/MW-year under Low Demand. High Renewables widens TB4 spreads, the daily spread between the four most and least expensive hours, by 13%. It also holds capacity prices across the whole RTO at the top of the Variable Resource Requirement (VRR) curve for two extra delivery years. Low Demand removes the 2030 scarcity spike and pulls capacity prices off the top of the curve six years earlier than Central.

Key takeaways

• High Renewables lifts PJM's TB4 spreads by 13% on average, 26% at the 2030 peak and 17% by 2049, as pricier gas raises the evening peak and 24 GW of extra solar deepens the midday trough.
• High Renewables also keeps RTO-wide capacity prices at the top of the VRR curve for two extra delivery years, and its capacity prices average 38% higher than Central over calendar years 2040 to 2045.
• Low Demand has no 2030 TB4 spike, unlike the other two scenarios. With smaller data center load additions, its 2030 spread is $45k/MW-year against $111k/MW-year in Central.
• Low Demand also pulls RTO-wide capacity prices off the top of the VRR curve in 2034/35, six delivery years before Central.
• High Renewables builds 24 GW more solar and 2.7 GW more storage than Central by 2049. Low Demand builds 51 GW less gas, 30 GW less solar and 5.5 GW less storage.

What the three scenarios assume

The Central Case follows PJM's published load forecast and Modo Energy's base Henry Hub curve. Generation capital costs follow the National Renewable Energy Laboratory's Annual Technology Baseline (ATB) Moderate trajectories, with only storage on the Advanced trajectory.

High Renewables keeps that demand forecast but uses the ATB Advanced trajectory for wind and solar capital costs, lifts gas and coal prices by 10%, and cuts annual gas build ceilings by 10% to reflect tighter turbine supply and permitting.