The Federal Energy Regulatory Commission (FERC) has issued a ruling on PJM Interconnection’s proposed large load plan, rejecting measures that would have held data centers accountable for their costs. The decision, which flies in the face of the White House Ratepayer Protection Pledge, gives Big Tech the green light to keep shifting the enormous costs of data center electricity demand and infrastructure onto everyday consumers.
Specifically, on Oct. 9, FERC struck down PJM’s plan to make data centers bring their own new capacity to the grid, or face curtailment during grid emergencies. It also rejected a measure to remove data centers that failed to bring their own energy from the demand curve in the capacity market—a key provision that CUB fought to include in the package of reforms. Instead, consumers will continue to bear the burden of unprecedented capacity costs driven by data center demand, which have already set them back $29.4 billion from recent auctions alone.
“FERC’s decision defangs PJM’s proposal, hollowing it of rules that would actually address the electricity affordability crisis,” said Clara Summers, Director of the Consumers for a Better Grid campaign. “It sends a clear message: the federal government is not going to save us—states are on their own. PJM’s plan already leaned on states to enforce their terms—now, the full burden of regulating data centers and protecting consumers falls on state leaders. In Illinois, that makes passing the POWER Act more urgent than ever.”
For years, PJM has faced pressure to address reliability and affordability concerns driven by the rapid growth of data centers across the region. In August, following an accelerated stakeholder process, PJM submitted its Interim Resource Adequacy Service (IRAS) plan to FERC. The plan would have required new large load customers (50 megawatts or more) to secure their own capacity supply through bilateral agreements or a special one-time auction, or be subject to involuntary curtailment during emergency grid conditions. The plan relied heavily on the states taking an active role in holding data centers accountable.
FERC’s rejection of PJM’s IRAS framework, however, signals that plans to rein in data center costs must be driven exclusively by states. While the decision comes as a disappointment to consumer advocates, states have options for protecting residents. CUB’s Consumers for a Better Grid campaign recently published a legislative toolkit for state leaders and policymakers that identifies solutions to address data center demand, giving clear examples of legislation that can fill the void left by FERC’s decision to strip PJM’s plan of meaningful reform.
Millions of everyday people across the country are burdened with growing electricity bills—and FERC’s ruling promises that, without state action, relief won’t arrive. Our leaders must meet the moment and pass legislation that binds Big Tech to their empty promises immediately. (In Illinois, for example, CUB is working to pass the POWER Act to hold data centers accountable for their costs.)
This article was written as part of CUB’s Consumers for a Better Grid Campaign, dedicated to advocating for consumer interests at the largest power grid in the nation. Learn more and sign up for updates here.
