NEWS: PJM’s 2028-’29 capacity auction missed the reliability target…and added over $6B in data center-driven costs.

What happened: The auction clinched over 138 GW of unforced capacity generation and demand response…but fell 7 GW short of PJM’s reliability requirement (marking the third-straight year with a deficit). Another triennial tradition: The auction yet again hit the FERC-approved price cap ($325/MW-day). This signals that “demand for electricity is growing faster than new power generation is being built,” PJM COO Stu Bresler wrote in a statement.

The (huge) data center piece: Surging demand from these facilities contributed over a third of the auction’s total capacity cost ($16.4B). Since 2024, data centers have added nearly $30B in such costs. One idea to shield other ratepayers: data center-specific auctions.

What’s next: To keep the country’s largest grid up and running, PJM has several fixes in the works. These include 1) a temporary interconnection fast-track for “shovel-ready” generation 2) an emergency backstop auction set for September and 3) a potential “Connect and Manage” process à la ERCOT.