At the end of 2024, we stated that 2024 marked a “dramatic inflection point for the electricity market where supply and demand diverge and a secular period of ‘scarcity’ has formally commenced.” By December 2025, we were proven correct with the capacity auction for 2027/2028 resulting in the RTO being 6.6 GWs short. During Winter Storm Fern this January, PJM has posted quite possibly the highest energy prices the RTO has ever recorded. We are now witnessing the manifestation of the unsustainable supply/demand imbalance resulting in high volatility and extreme energy prices. Now is the time to work with your Calpine representative to hedge your energy needs longer term, as the period of ‘scarcity’ will remain for the foreseeable future.