PUBLIC UTILITIES ADVISORY BOARD AGENDA ITEM
ACTION REQUESTED:
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Receive Electric Utility Regulatory Update Memo
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DEPARTMENT: Electric Utility
SUBMITTED BY: Brian Groth, Director of Electric Utilities
BOARD/COMMISSION REVIEW:
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PURPOSE:
The purpose of this memorandum is to provide the Public Utility Advisory Board (PUAB) with a status update on market and regulatory changes impacting the City of Naperville’s Electric Utility.
Key regulatory drivers for 2026 include:
● Illinois Resource Adequacy Study Findings Released
● Illinois Clean and Reliable Grid Affordability Act (CRJA) Passage
● PJM Delivery Year 2027/2028 Capacity Auction Results
DISCUSSION:
1. Resource Adequacy Study Findings Released
The Climate and Equitable Jobs Act passed by the State of Illinois Legislature in 2021
required the Illinois Commerce Commission, Illinois Power Agency, and Illinois Environmental Protection Agency to produce a Resource Adequacy Study by December 2025. Energy and Environmental Economics Inc was hired to support the process and develop the study, which was posted on December 15, 2025, and the general findings are as follows:
. PJM will need 22,000 - 28,000MW of capacity by 2030 with MISO needing 9,000 - 18,000MW in the same time frame.
• Load growth is accelerating while coal, gas and oil powered generation units are planning to retire across the grid
• Natural gas-fired generation is slow to come online due to long equipment lead times as well as permitting and siting issues
• Renewables and batteries have lower effective capacity values than thermal resources requiring more resources to be put on the grid.
• Long interconnection queues and transmission constraints are common for development of new generation projects.
Due to the study’s finding that neither the ComEd zone in PJM nor Zone 4 in MISO have enough resources to meet 2030 requirements it is likely that the State will become a net importer of power.
There are concerns with this concept as PJM as a whole is projected to have a capacity shortfall in 2029 and MISO as a whole is projected to have a capacity shortfall in 2030, so it is possible that power will have to be imported from outside of PJM and MISO.
The study concluded that a diversified resource strategy can help the state meet its 100% clean energy goals through the development of wind, solar, batteries and utilizing thermal assets during the transition. Additionally, building new transmission lines to facilitate import of power from other states as well as development of new zero-emissions technologies will help.
The study and more information about the next steps, which includes a Resource Adequacy Plan Mitigation Workshop, can be found at the following location: <https://ipa.illinois.gov/electricityprocurement/resource-adequacy.html>
North American Energy Reliability Corporation’s reliability assessment can be found here: <https://www.nerc.com/globalassets/our-work/assessments/nerc_ltra_2025.pdf>
2. Illinois Energy OMNIBUS Bill Passes both Chambers
The Senate voted 37-22-0 to pass the Clean and Reliability Grid Affordability Act (CRGA) which is contained in house amendments #4 and #5 to SB25. The governor has signed the bill, and it will become effective June 1, 2026.
Briefly, the bill does the following:
• Requires municipal electric utilities/joint action agencies (JAAs) to conduct integrated resource planning every 5 years
• Requires the state to conduct a state-wide integrated resource plan for the Ameren, ComEd and alternative retail electric supplier customers.
• Adds a new storage procurement program of up to 3,000MW by 2030.
• Creates a new geothermal home and business renewable energy credit incentive program.
• Creates an investor-owned utility (IOU) Virtual Power Plant (VPP) program.
• Repeals the current moratorium for construction of new large nuclear facilities.
• Increases the IOU customer cost cap to provide more funding for the renewable portfolio standard incentive and procurement programs.
• Imposes new marketing and consumer protections on solar vendors.
More information on the Clean and Reliable Grid Affordability Act (CRJA) can be found here:
https://ipa.illinois.gov/renewable-resources/energy-storage.html
2. PJM Base Residual Auction Results
PJM Base Residual Auction (BRA) results were recently released. PJM Capacity prices for the Delivery Year (DY) 2027/2028 (June 1, 2027 - May 31, 2028) cleared at $333.44/MWD; this is up 1.3% over the last auction and a record price for the third year in a row. This price included the FERC approved price cap; without this cap the estimated clearing price would have been $542.80/MWD. This auction did not meet the PJM reliability requirement by 6,623MW and will result in a reduced reserve margin of 14.8%. Peak demand for the DY27/28 period was 5,250MW higher than the previous delivery year with 5,100 of that growth being attributed to data centers.
More information on the Delivery Year 2027-2028 Capacity Auction can be found here:
https://insidelines.pjm.com/pjm-auction-procures-134479-mw-of-generation-resources/
More information on PJM Capacity Auctions in general can be found here:
https://www.pjm.com/-/media/DotCom/about-pjm/newsroom/fact-sheets/pjm-capacity-market-promoting-future-reliability-fact-sheet.pdf
RECOMMENDATION:
Receive the Quarterly Regulatory Update and Outlook (Q1 2026).