PJM members recently voted down 12 proposals to handle new data center demand, board still advancing final plan by December.
PJM Interconnection – the grid operator that covers all or parts of 13 states and D.C., including Maryland – is working on new rules for how large, power-hungry data centers plug into the system. Rapid growth in AI and cloud computing is driving up electricity demand, especially in nearby Northern Virginia, and PJM expects data centers to account for nearly all of roughly 32 gigawatts of additional load through 2030. PJM’s members recently rejected a dozen different stakeholder proposals on how to handle these new loads, but PJM’s Board still plans to bring forward its own plan by December to manage the queue of data center projects and protect grid reliability.
A bipartisan multijurisdictional proposal advanced by Maryland State Senator Katie Fry Hester would have required large new data centers to “bring their own” capacity if they want firm service from PJM—PJM would stop procuring capacity on their behalf, and any portion of their load not backed by new capacity would be treated as interruptible. Data centers could meet this obligation by adding new generation or demand-response resources, buying surplus capacity in later auctions or bilaterally, and using fast-track, energy-only interconnections whose performance and transmission risks they themselves would bear. If they do not secure enough supporting capacity, their load would be subject to curtailment during tight system conditions, and state regulators would decide how those curtailment obligations flow down to individual facilities.
PJM has warned that, without more generation, the region could face power shortfalls as early as 2027, and recent capacity auctions have seen prices jump more than 1,000 percent, costs that ultimately flow through to ratepayers. The PJM region experienced its first limited energy blackout this summer in Maryland, narrowly dodging a wider disaster and a more extensive outage.
While the 12 proposals were rejected, the Board of Managers will have the ultimate say and still plans to bring forward a strategy for balancing data center and demand growth sometime in December. Follow Conduit Street as this story develops.