PJM grid strains under AI power demand surge
America’s largest grid operator struggles to balance data centre-driven demand with delayed power plant construction, risking blackouts and rising costs.
Image for illustrative purposes
USA, Pennsylvania, Harrisburg: PJM Interconnection, the largest power grid operator in the United States, is facing mounting pressure as electricity demand driven by artificial intelligence (AI) data centres surpasses the rate at which new power plants are being brought online. The grid, which serves 67 million people across 13 states, is seeing electricity prices spike, with projections of more than 20 % increases this summer in some areas.
The strain is especially acute in regions such as Northern Virginia’s “Data Center Alley”, where soaring demand from AI applications is outpacing supply. Despite plans for 209 GW of new capacity, only 22 GW will come from dependable baseload sources.
Governor Josh Shapiro of Pennsylvania has criticised PJM for delays in plant connections and has even suggested the state could exit the grid. Meanwhile, PJM’s leadership is under upheaval, with its CEO set to depart and board members voted out after auction prices jumped 800 % last year.
While PJM attributes the crisis partly to state policies phasing out fossil fuel plants and local resistance to new projects, critics say the grid operator has worsened the situation by freezing application processes and delaying reforms.
Though some progress has been made, such as auction reforms and fast-tracking 51 projects, most new plants, including Microsoft-backed Three Mile Island, will not be operational before 2027.
With blackouts looming and AI-fuelled growth continuing, experts warn that America’s energy infrastructure may not be ready for its digital future.
Source: Reuters
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