Dive Brief:
- By 2030, the PJM Interconnection is likely to face a “loss of load expectation,” or LOLE, between six and 100 times worse than the grid operator’s planning criterion, mainly due to the addition of large-load data centers, according to a study commissioned by the Pennsylvania Public Utility Commission.
- The PUC and the firms that produced the report — Synapse Energy Economics, Mondre Energy and Aspen Technologies — characterized it as an independent analysis aimed at developing load projections and evaluating resource adequacy under a set of likely possible futures.
- In models covering 2027 through 2030, both a reference scenario and a high-load, low-supply scenario show PJM’s planning criteria for resource adequacy not being met. Only under a scenario with no new data centers is the region able to meet PJM’s target LOLE of 0.1, the report said.
Dive Insight:
PJM’s standard is designed to limit potential electricity shortages “to approximately one event every 10 years,” said a PUC release about the report.
In the study’s reference scenario, which relies on PJM’s 2026 load forecast, the modeled 2030 LOLE is 0.59, “or nearly six times worse than the PJM planning criterion,” it said.
In a “worst-case future” of higher-than-expected load additions and constrained resource deployment, the modeled LOLE is 13.20 — “over 100 times worse than PJM’s planning criterion,” indicating an expectation of “more than 13 days with loss of load events per year.”
“As in the Reference scenario, these reliability issues are largely due to surging data center additions,” the study said.
“This analysis sends a clear warning: electricity demand and supply are moving out of balance, and the status quo is not sustainable,” PUC Chairman Steve DeFrank said in a statement. “We need urgent action at PJM and a broader Pennsylvania energy strategy that makes sure our supply of electricity keeps pace with demand.”
PJM, in a statement to CBS affiliate WJAC, acknowledged that new data center loads are growing faster than supply.
“PJM has taken a number of actions to both increase electricity supply and manage new demand in line with the Ratepayer Protection Pledge taken by data center developers to shield residential customers and other ratepayers from bearing reliability risks or cost increases associated with data center development,” said Jeff Shields, PJM's senior manager of external communications.
The reference scenario anticipates Pennsylvania remaining a net energy exporter, but sees its exports “decrease from about 91 TWh in 2025 to about 69 TWh by 2035 and 38 TWh by 2040,” the report said.
In the high-load, low-supply scenario, Pennsylvania becomes a net importer of 5 TWh by 2040.
“Because this scenario has a large amount of unmet load in 2031 and later years, it is likely that some amount of this 2035 and 2040 load will be unmet, as there will not be enough regional generation to meet PJM-wide load requirements,” the report says.
Last month, Pennsylvania Gov. Josh Shapiro, D, issued an executive order that the state will offer preferential permitting to data center projects with peak demand of more than 25 MW if they commit to certain requirements, including sourcing their electricity from new power supplies.
The PUC also voted unanimously Thursday to approve two motions concerning data center development and ratemaking. One of the motions directs PUC staff to propose updates to the state’s rules for emergency curtailment, and to organize a technical conference on cost allocation for data centers.
The report notes that PJM and the U.S. Department of Energy “have implemented several initiatives, policies, and programs to address growing concerns about PJM’s resource adequacy,” including interconnection queue reform and reliability backstop procurement.
“PJM and its stakeholders are also currently discussing additional initiatives such as load forecasting improvements,” the report said. “DOE has also committed to keeping some coal-fired power plants online beyond their retirement date, in an effort to maintain resource supply in the region.”
