A new report warns that the White House’s proposed $15B data center capacity auction for the PJM grid could backfire. (Latitude Media)
The administration's plan to fund new power plants via 15-year data center contracts will only buy 6–10 GW of capacity—coming up short of PJM's projected 24 GW deficit by 2030, according to Aurora Energy Research.
Splitting the market between new and existing generation could force older plants to retire prematurely. Aurora estimates a net gain of just 3 GW for every 6.1 GW procured, while extended price caps could drive existing generators to export power to neighboring grids.
So what to do instead? Aurora suggests relying on targeted large-load tariffs to protect residential ratepayers—similar to AEP Ohio requiring data centers to pay for 85% of their contracted capacity regardless of use.