$12B of US ratepayers' money wasted on a modeling mistake in PJM

The article's main complaint is that generating capacity has been overbuilt by maybe 10%. That's not a bad thing. There are worse things than extra generating capacity.

I don't doubt that ISO models are not optimal, but the annual cost of power outages to US consumers is above 100 billion dollars last time I looked already. Electric system reliability is a place where you have to be somewhat conservative as costs rise really non-linear with outage intensity. [1]

And ISOs/RTOs/TSOs operate in complex political environments and have to ensure reliability in adverserial markets. They are often constraint in what they can/can't do.

What I will say is that their modelling should absolutely be open and transparent, and typically it's not. That would make necessary discussions around modelling assumptions, potential improvements and political constraints much much easier and more fruitful.

[1] That said, my intuition is that current outages are probably not due to supply insufficiency, but due to transmission system failures.

PJM Interconnection LLC (PJM) is a regional transmission organization (RTO) in the United States. It is part of the Eastern Interconnection grid operating an electric transmission system serving all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and the District of Columbia. PJM is the largest power grid operator in the United States, serving 67 million customers from Chicago to New Jersey. (Wikipedia)

That was not clear in the article.

Unfortunately, the article misses the forest for the tree: it points the shortcomings of one particular electricity market model, but never acknowledge that the whole endeavor is doomed to fail: the way electricity works physically (coupled with the way societies have been built around it being readily available) makes it fundamentally impossible to manage through market forces. And as a result, every attempt results in an apparently nonsensical failure (see also how the European electricity market's "copper plate" model leads to the insanely high re-dispach costs).

What software did they build their model in?

This reminds me of the 2013 finding that showed an earlier 2010 study praising austerity as a recovery mechanism was flawed because of an Excel calculation error and lack of diligence.

https://inthesetimes.com/article/the-excel-error-heard-round...

It also reminds me of the flaws in the London epidemiological model about how to respond to covid.

It just may be that these things should be reviewed a little closer by people who are obsessive about correctness

Every "wasted $" ended up in some parasitical grifter's pocket.

Whilst these sorts of analyses are informative, they lack answers to the who profits? question.