The question of who pays to connect the next wave of large electricity loads — the data centers reshaping demand across the eastern grid — got a partial answer this month, and it wasn't the one the market expected.
In an order issued October 9, the Federal Energy Regulatory Commission rejected most of PJM Interconnection's plan for bringing giant new loads onto its 13-state system. PJM had proposed an Interim Resource Adequacy Service that would let a large load connect without matching new generating capacity, on the condition it agreed to be curtailed first in a grid emergency — paired with "bring your own capacity" rules. FERC kept only the uncontroversial pieces: a formal definition for large loads and a registry to track where they sit, how fast they ramp, and what capacity backs them.
What FERC rejected is more telling than what it kept. The Commission found that the interim service's obligations and compensation framework effectively set a retail rate and dictated which retail customers get curtailed first — and those, it said, are decisions reserved for the states. As FERC put it, states "have a crucial role to play." Commissioner David Rosner warned separately that excluding these loads from the capacity auction's demand curve could distort the market, signaling surplus capacity even as the region involuntarily sheds thousands of megawatts.
Translation for anyone buying power in PJM: the fight over who absorbs the cost of the AI build-out is now a state-by-state patchwork, not a single federal rule. Ohio and Pennsylvania are the ones to watch, analysts at Jefferies noted, and the near-term read is higher capacity prices for longer — on top of capacity auctions that already cleared at nearly ten times prior-year levels.
For commercial and industrial buyers, the lesson isn't to wait for the patchwork to settle. It's that the parts of your bill set by markets and contracts — your supply, your timing, your zone — are the parts you still control, and they're diverging faster than the regulated pieces. The organizations that come out ahead won't be the ones with the best forecast of the next FERC order. They'll be the ones who already know, line by line, which half of their bill is actually shoppable.