PJM wants new data centres that bring no power of their own to cut back first near a grid emergency
PJM's board proposed a one-time backstop capacity auction for a 6.8 GW shortfall, 30 Sep to 21 Oct if FERC approves, capped at $555/MW-day with 15-year commitments. Separately, new large loads without their own supply would be curtailed near emergency conditions.
Capacity charges sit on the bill of every business in the PJM region, across 13 states and Washington DC. This summer the grid operator said it is short of power and asked who pays.
Utility Dive reported on 28 July 2026 that PJM's board proposed a one-time backstop capacity auction to cover a 6.8 GW shortfall from its last auction, for the delivery year starting mid-2028. If FERC approves, the auction would run from 30 September to 21 October. Offers would be capped at $555 per MW-day, up from the temporary $325 cap in the last base auction. Commitments would be for 15 years, and resources are due online by 1 June 2032.
A separate proposal targets large loads. Under a framework PJM calls IRAS, formerly known as connect and manage, data centres and other large loads that do not bring new power supplies would reduce use or switch to on-site backup when the system nears emergency conditions. PJM will also create a large-load registry. The board expects large loads could grow by 70 GW by 2038. Backstop costs would be shared by load-serving entities, and state regulators decide how they spread across rate classes.
Analogy: it is a building where the newest tenants agree to switch off their air conditioning first in a heatwave, unless they brought their own generator.
Good: on-site supply now has a clear value in PJM. A large site that brings its own generation or storage stays out of the first group to be curtailed.
Bad: the $555 cap is higher than the last one, and the market monitor says keeping data centre load in auctions has already added $29.4 billion to capacity costs over four auctions.
Ugly: how much of the backstop cost lands on commercial customers is up to each state. A business in PJM cannot yet see its share.