Energy Market Update - Sustainability Corner

LevelTen Energy’s snapshot on U.S. and EU Power Purchasing Agreement (PPA) pricing is below. For more information on LevelTen please visit www.leveltenenergy.com.

April 29, 2026: RGGI Confirms Virginia’s Re-Entry for July 1, 2026; Identifies Alignment with Third Program Review to Come Later in 2026

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• Virginia is on track to reenter RGGI, the Regional Greenhouse Gas Initiative, on July 1, 2026. The state will participate in the September and December auctions and will likely return as a net buyer, potentially adding upward pressure to allowance prices.
• The Virginia Department of Environmental Quality (DEQ) is pursuing a two‑step approach. First, VA will aim to immediately reenter RGGI by reviving its previous regulation, and second, the state will aim “to align the resurrected regulation with the Third Program Review, which goes into effect in 2027.”
• Key areas to monitor will be energy affordability, especially with continued data center growth in Virginia, and the impact of the upcoming midterm elections which will occur in November 2026.

April 29, 2026: Over 800 New Generation Projects Seek to Connect Under PJM’s Reformed Process

Over 800 New Generation Projects Seek To Connect Under PJM’s Reformed Process | PJM Inside Lines

• PJM Interconnection said 800 generation projects applied to connect to the grid in the first cycle of its revamped interconnection process, which aims to speed reviews and improve predictability. Together, the projects represent about 220 GW of potential capacity.
• After the April 27th application deadline passed, PJM entered the review phase to verify that projects submitted the required technical and financial data for interconnection. PJM will prioritize the most advanced projects under a “first-ready, first-served” approach.
• The applicant pool spans multiple resource types, led by 349 storage projects (66.5 GW) and 157 natural gas projects (105.8 GW), plus 142 solar projects (14.8 GW), 65 wind projects (4.7 GW), 45 solar‑storage hybrids (8.9 GW), 27 nuclear plants (17.9 GW), and others.

The surge in applications underscores strong developer interest and rising electricity demand across PJM, driven mainly by data centers, advanced manufacturing, and broader electrification.

NYISO: Hochul and Legislative Leaders Reach Tentative Budget Agreement

• On 5/7, New York lawmakers and Governor Kathy Hochul reached a tentative $268 billion state budget agreement.
• The budget includes targeted amendments to the state’s 2019 Climate Act due to concerns that existing timelines could drive sharp increases in utility, gasoline, and heating costs.
• Key changes include establishing a new 2040 emissions target of a 60% reduction.
• The agreement delays regulations that set enforceable greenhouse‑gas (GHG) reduction requirements until 2028.
• The 2019 Climate Act mandates:
  • 70% renewable generation by 2030
  • Net‑zero emissions by 2050
• The proposed changes stem from an October Supreme Court ruling requiring the Department of Environmental Conservation (DEC) to implement rules supporting the Climate Act’s goal of reducing GHG emissions by 40% by 2030.
• The required rules were due two years ago, prompting environmental groups to sue the state for enforcement.
• The agreement changes the GHG measurement formula from a 20‑year to a 100‑year time span, which lowers the measurable atmospheric impact of bio‑genic fuels.
• The deal proposes $1 billion in utility customer rebates.
• It also includes $1 billion for sustainable energy projects, with a specific carve‑out for environmental justice communities.
• The budget includes a ratepayer protection plan intended to reform utility rate‑setting and prevent companies from passing certain costs to customers

NYISO: NYSERDA Launches a New Onshore Renewable Procurement

• On 4/24, the New York State Energy Research and Development Authority (NYSERDA) launched its 10th annual renewable energy standard solicitation (RESRFP26‑1).
• The solicitation is intended to accelerate clean energy deployment across New York.
• NYSERDA will procure Tier 1‑eligible renewable energy certificates (RECs).
• Eligible projects are mature land‑based renewable projects, including wind, hydroelectric, and solar.
• The procurement aims to identify projects with a near‑term path to commercial operation.
• Projects will be evaluated through two‑step evaluations based on:
  • Benchmark REC pricing
  • Minimum threshold requirements
  • Additional price and non‑price factors
• Project price submissions are due on 7/30.
• Initial awards are expected in September 2026.
• The solicitation supports New York’s goal of emissions‑free generation by 2040.
• It aligns with NYSERDA’s pipeline of 61 large‑scale renewable projects, projected to add more than 9 GW to the grid once operational.

NYISO Says Peakers Needed Through 2029

• Recently, NYISO notified the Department of Environmental Conservation (DEC) that Alpha Generation’s barge‑mounted peaker plants in Brooklyn (Gowanus and Narrows, ~609 MW) must remain operational through 2029.
• NYISO stated the plants are needed to address near‑term reliability risks, including risks as soon as this summer under extreme heat conditions.
• In its Short‑Term Reliability Process report, NYISO cited thinning dispatchable capacity as increasing operational challenges.
• More than 1,600 MW of dispatchable fossil generation has retired since 2023 under the state’s peaker plant emissions rules.
• The state has no role in reviewing NYISO’s decision under DEC’s peaker emissions regulations.
• Alpha Generation withdrew its retirement notice for the plants. Alpha Generation is pursuing the potential repowering of the plants at the Public Service Commission.
• Environmental advocates argue the multi‑year extension should be revisited after the Champlain Hudson Power Express (CHPE) hydropower transmission line enters service later this month.
• Advocates note NYISO forecasts indicate the CHPE project could alleviate short‑term reliability needs. NYISO stated that recurring, hyper‑short interval reassessments are not a responsible basis for infrastructure planning.
• NYISO plans to initiate a broader long‑term Reliability Needs Assessment review later this year. Stakeholders are debating whether additional transmission, repowering, and other non‑emitting solutions can replace peakers within regulatory timelines.

ISO-NE: ISO-NE Releases CELT Report

• On 5/1, ISO‑NE released its Capacity, Energy, Loads and Transmission (CELT) report.
• Demand is forecast to increase by about 9% by 2035.
• This forecast is lower than the 11% projected in 2025 and the 17% growth reported in 2024.
  • The decline is attributed to revised assumptions around electrification, primarily:
    • Electric vehicles
    • Electric heating load
  • These changes reflect the removal of federal incentives and revised state policies.
  • Near‑term
    • Summer 2026 peak demand: 25.2 GW
    • Winter 2026–2027 peak demand: 20.5 GW
• Longer‑term
  • Summer peak demand grows from 25.2 GW in 2026 to 26.8 GW in 2035.
    • The region’s all‑time summer peak was 28.1 GW in 2006.
    • Behind‑the‑meter solar is expected to reduce summer peak demand by approximately 1.9 GW in each year of the 10‑year forecast.
    • Winter peak demand grows from 20.5 GW in 2026 to 26.4 GW in 2035.
    • The region’s all‑time winter peak was 22.8 GW in 2004.
• With revised electric heating load assumptions, forecasts show a transition to a winter‑peaking system in 2035, with winter and summer peaks both approximately 26.5 GW.
• Heating electrification is forecast to contribute over 5 GW to the winter peak in 2035/2036.