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Columbus electric rates and the new PJM capacity auction

State spotlight

PJM 2025 capacity auction cleared at $269 per MW-day. Columbus AEP customers see this in supply rates from June. Here is the math.

Featured infographic

How the 2025 PJM auction flows into Columbus bills in June 2026

Auction clears May 2025 → tariff filing → June 2026 retail rate change. The 18-month lag is standard.

Open graph image · /og/capacity-stack.png

Columbus and Franklin County are in AEP Ohio territory. The 2025 PJM capacity auction cleared at $269 per MW-day — the highest in a decade. That clearing price flows into AEP Ohio supply rates starting with the June 2026 billing cycle. The capacity component of the typical Columbus residential bill rises by $8 to $14 a month. Locking a supplier contract before June captures the pre-auction price; staying on AEP SSO absorbs the auction result directly.

How the PJM Base Residual Auction works

PJM runs the Base Residual Auction each May/June to procure capacity for the delivery year starting the following June 1. Generators bid in their capacity (in MW); PJM clears the auction at a single $/MW-day price.

The cleared price flows into utility procurement costs and then into retail tariffs filed with state PUCs. The lag from auction clear to retail rate change is roughly 12 to 18 months.

The $269 per MW-day clear and what it means

The 2025 auction cleared at $269 per MW-day, the highest in a decade. The driver was retiring coal generation, slow renewable integration, and growing data-center demand.

For Columbus AEP customers, the auction result adds roughly $8 to $14 a month to the capacity component of the residential bill starting June 2026. The increase is regulated and identical across all suppliers in AEP territory.

Why locking before June matters

Locking a supplier rate before the June 2026 effective date captures the pre-auction price on the supply portion. The capacity portion still moves with the regulated tariff, but the supply portion stays at the locked rate.

Households on AEP SSO absorb both moves. The locked-vs-SSO gap typically widens by 1.5 to 2.4 cents per kWh after a high-clearing capacity auction.

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Common questions

Quick answers from the editorial desk

When does the next PJM capacity auction hit my bill?
The 2025 auction cleared at $269 per MW-day. It flows into Ohio retail rates starting June 2026 billing cycles. The 2026 auction (clearing May/June 2026) will flow into June 2027 rates.
How much does the capacity auction raise my Columbus bill?
Roughly $8 to $14 a month on a typical residential bill in Columbus AEP territory starting June 2026. The increase is regulated and identical across all suppliers.
Can I avoid the capacity charge by locking a supplier rate?
No. Capacity is a delivery-side charge set by the regulated tariff. Locking the supply rate stabilises only the supply portion (roughly 60 to 70 percent of the bill). Capacity continues to flow through to your bill regardless of supplier.
What is the capacity charge bucket vs the energy charge?
Capacity covers the cost of having enough generation available to meet peak demand. Energy covers the actual kWh delivered. Capacity is paid per kW of customer demand allocated. Energy is paid per kWh consumed. Both appear separately on most US utility tariffs.

Further reading

Pillar guide, cluster siblings, and state pages cited above

Sources

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