FERC Says 1,100-Mile PJM Grid Needs Urgent Reform as AI Power Demand Surges
Updated
Updated · Bloomberg · May 12
FERC Says 1,100-Mile PJM Grid Needs Urgent Reform as AI Power Demand Surges
1 articles · Updated · Bloomberg · May 12
Laura Swett said PJM Interconnection may have grown too large to function effectively, warning the biggest US grid needs urgent reform.
July 23 is when FERC plans a conference on changes, driven by concern PJM cannot respond fast enough to booming data-center and AI electricity demand.
PJM is facing that load growth while also trying to contain soaring power bills, sharpening pressure on the operator’s market design and planning process.
The warning puts broader US grid reliability and power-supply readiness in focus as AI expansion accelerates electricity demand.
As AI's power thirst grows, who will pay the multi-billion dollar cost to upgrade America's grid?
Can grid reforms and new tech outpace the explosive energy demands of artificial intelligence?
Grid at the Breaking Point: PJM’s 46 GW Backlog, AI Data Centers, and the Race for Transmission Reform
Overview
PJM is facing urgent reforms after a December 2025 FERC order found its rules for generators co-located with load to be unjust and unreasonable, lacking clear guidelines and fair rates. This directive requires PJM to overhaul its interconnection procedures and introduce new transmission services, setting a precedent for other regions. In response, PJM submitted a compliance filing in February 2026, proposing major changes to its tariff, especially for behind-the-meter generation tied to fast-growing AI and industrial loads. These actions aim to clarify operations for data centers and ensure grid reliability amid soaring electricity demand.