Electri-Friday: Speed, Scale, and the Q2 Setup

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Electri-Friday: Speed, Scale, and the Q2 Setup

2029 PJM BRA. PJM's 2028/2029 Base Residual

Auction (BRA) results are expected after market close on July 14, and we expect the

headline clearing price to land near the top of the FERC-approved collar at approximately

$335/MW-day. While the capped clearing price is likely to remain relatively stable, the key

variable remains the uncapped clearing price (U-Cap), which the firm believes will provide

the clearest signal on the underlying supply-demand balance. An uncapped clearing price

above roughly $600/MW-day would reinforce the view that demand continues to outpace

supply and would likely be supportive of merchant PJM generators, particularly Talen,

Constellation, NRG, and PSEG. The report also highlights PJM's recent heat wave, which

drove peak demand near record levels and spot power prices above $2,500/MWh, as further

evidence of tightening resource adequacy. In parallel, Evercore expects PJM's upcoming

Section 205 filings on Reliability Backstop Procurement (RBP) and Connect & Manage

(C&M) to emphasize state-led implementation and preserve additional pathways for new

generation development, which remains constructive for long-term IPP fundamentals.

◼ EROC: A Potential (Turn)key to A Bridge (Solution) Found Under An ERock: Initiating

Coverage at Outperform. Evercore initiated coverage of ERock (EROC) with an

Outperform rating and a $28 price target, citing the company's differentiated modular natural

gas "bridge-to-flex" power solution as a compelling way to address accelerating AI-driven

power demand and prolonged grid interconnection timelines. The firm expects ERock's

installed base to expand from approximately 1 GW today to more than 9 GW by 2030,