Angry with the rising cost of electricity, a bipartisan group of governors is expected to dress down officials that manage the nation’s largest power grid system on Wednesday for failing to rein in costs.
A representative for nine Eastern governors is expected to address executives of the grid system, known as PJM, during a meeting at its headquarters in Audubon, N.J., near Philadelphia. The grid stretches across 13 states, serving more than 67 million consumers from Chicago to Virginia Beach.
“As our regional grid confronts intertwined reliability and affordability crises, PJM itself faces an unprecedented crisis of confidence from market participants, consumers and the states,” nine governors wrote last week in a letter to PJM, a nonprofit organization. “In the past, other regions looked to join PJM due to its many strengths; today, across the region, discussions of leaving PJM are becoming increasingly common.”
A 10th governor, Mike DeWine, Republican of Ohio, sent a separate letter to PJM making similar points.
In June, The New York Times reported that Democratic and Republican governors were increasingly angry and frustrated with PJM. Many of them have said the nonprofit is not doing enough to check the rising cost of electricity, including by not moving quickly enough to add cheaper sources of energy to its grid.
State officials have been communicating with one another about their concerns, including what they say is the nontransparent way in which PJM makes important decisions about the grid. The officials also say the nonprofit, which is run by industry representatives and overseen by a federal regulatory agency, is not sufficiently accountable to state lawmakers or residents.
In last week’s letter, the governors pressed PJM to fill two vacant seats on its board with “distinguished, widely respected individuals” who appreciate the importance of lowering electricity costs for consumers.
In response to the governors’ criticisms, PJM’s board said it shared the desire for the most qualified candidates.
“While perspectives may differ, PJM remains focused on its core mission: delivering reliable, affordable power to 67 million people and navigating complex stakeholder priorities with transparency and integrity,” the organization said in a statement on Wednesday.
PJM has a 10-seat board of managers, all of whom have spent most of their careers in the energy industry or in other senior corporate jobs. It also has more than 1,000 voting members, most of which are utilities, power plant companies, transmission-line owners and energy traders.
Most of those voting members have a direct financial stake in the organization’s decisions. Members typically vote on policies and issues. Some of the member votes are public, but others, including at smaller committee meetings that make preliminary decisions, are not.
PJM is regulated by the Federal Energy Regulatory Commission, but energy experts say that agency does not have the ability to closely monitor regional grid operators.
The price of electricity has steadily risen over the last several years after decades of gradual increases. The cost of electricity for residents of Delaware, Maryland, New Jersey, Pennsylvania and Virginia has increased between 23 and 40 percent over the last five years, federal data shows.
Before jointly confronting PJM, some governors had begun challenging the organization individually.
In December, Gov. Josh Shapiro of Pennsylvania, a Democrat, sued PJM after its annual auction in which power plant owners submit the price they are offering to supply energy when demand surges, which often happens in summer. The prices set in the auction would have resulted in big rate increases for electricity users. As in many such auctions, the winning bid sets the final price for all generators, meaning even plant owners willing to accept less money are paid the higher prices.
Mr. Shapiro and PJM reached a settlement that caps the price set by the auction. The governor said the deal would save Pennsylvanians $21 billion over two years.
A new auction on Tuesday resulted in a 22 percent increase in the wholesale capacity price across the entire PJM market. Rate increases will be higher in some states and lower in others.
That means residents and businesses in the PJM service area are likely to see their bills increase, according to one utility executive, Calvin Butler. He is the president and chief executive of Chicago-based Exelon and chairman of the Edison Electric Institute, a utility industry trade organization.
Mr. Butler said some of his customers in Maryland, for example, could pay an additional $1 to $4.50 a month as a result of the auction, depending on their location. Exelon serves parts of Maryland, Delaware, New Jersey, Pennsylvania, Illinois and the District of Columbia. He noted that the utilities in PJM did not make a profit from the capacity auction prices and that about 80 percent of the increases in consumers’ electricity bills were not directly related to utility spending.
Mr. Butler said the higher prices resulted from several compounding challenges, including rising demand for electricity, aging grid infrastructure and a limited supply of power.
“We need mid- to long-term solutions,” he said in an interview with The Times. “You have a high demand and low supply. This is not sustainable for us. We have to do something different.”
In February, Gov. Glenn Youngkin, Republican of Virginia, sent the chairman of PJM’s board a letter that criticized the organization for not consulting other states before settling with Pennsylvania. That settlement, Mr. Youngkin wrote, highlighted the grid manager’s piecemeal approach to running its system — an approach that the governor said was helping to drive up electricity costs.
Ivan Penn is a reporter based in Los Angeles and covers the energy industry. His work has included reporting on clean energy, failures in the electric grid and the economics of utility services.
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