PJM's power capacity price rose 11-fold in two years — and data centers caused most of it
Summary
PJM, the grid operator for roughly 65 million people across 13 states and D.C., saw its capacity auction price climb from $28.92 to $329.17 per megawatt-day in two years — an 11-fold increase. Data centers alone are responsible for 63% of the latest jump, adding $9.3 billion to the region's power costs. Meanwhile, the queue to connect new power plants to the grid has more than doubled, to over four years.
Follow the price
PJM Interconnection runs the wholesale electricity market for a swath of the country stretching from Chicago to the mid-Atlantic. Once a year it auctions "capacity" — payments to power plants for promising to be available three years out — and for most of its history that price barely moved. It just moved more in two years than it had in the prior decade.
View data as table
| 2024/25 delivery year | $28.92 | per MW-day, most zones |
|---|---|---|
| 2025/26 delivery year | $269.92 | per MW-day, most zones |
| 2026/27 delivery year | $329.17 | per MW-day, all zones |
From $28.92 to $269.92 in a single year, then up another 22% to $329.17 — an 11-fold increase from 2024/25 to 2026/27, per PJM's own auction reports. PJM's independent market monitor, Monitoring Analytics, put a number on the cause: data centers accounted for 63% of the 2025/26 price jump, adding an estimated $9.3 billion in costs across the region, and 40% ($6.5 billion) of the costs in the most recent auction for 2027/28 delivery. In PJM's "data center alley" around Northern Virginia, the forecast for load growth by 2037 nearly quadrupled between 2022 and 2025 — from about 5,700 megawatts to more than 20,000 megawatts from data centers alone, per an IEEFA analysis of PJM's load forecasts.
The same system, counted in years
Paying more for capacity is one response to surging demand. Getting new power plants built and connected is the other — and that side of the system has been getting slower, not faster, for two decades.
View data as table
| Built 2000-2007 | <2 yrs | median, interconnection request to operation |
|---|---|---|
| Built 2018-2024 | >4 yrs | median, interconnection request to operation |
Plants built in the early 2000s waited a median of under two years between requesting a grid connection and actually generating power, according to Lawrence Berkeley National Laboratory's Queued Up: 2025 Edition. Plants built 2018–2024 waited more than four years — the timeline has roughly doubled. And the backlog behind that queue is enormous: more than 2,060 gigawatts of generation and storage capacity, across roughly 8,200 projects, are sitting in U.S. interconnection queues waiting their turn, per LBNL's queue data — about twice the country's entire installed generating capacity. U.S. data center power demand alone is projected to rise from about 76 gigawatts in 2026 to over 134 gigawatts by 2030, in a 451 Research forecast published by S&P Global.
The takeaway
- The bill for data centers is landing upstream, first. Before it ever reaches a household rate case, the data-center demand surge is already visible as an 11-fold capacity-price increase and a market monitor's explicit $9.3 billion attribution.
- Money is moving faster than steel and permits can. Prices can reprice in a single annual auction; getting a new plant connected still takes years, and the queue is getting longer, not shorter, even as the price signal to build gets louder.
- The imbalance is structural, not temporary. With demand forecasts for one region nearly quadrupling in three years and a queue backlog twice the size of the existing grid, this is a capacity crunch measured in years, not an auction blip.
Capacity prices are PJM-wide most-zone clearing prices; some zones price differently. Interconnection queue and timeline figures are national aggregates from Lawrence Berkeley National Laboratory's annual survey of U.S. transmission-connected projects.
Sources
- PJM Interconnection, 2024/2025 Base Residual Auction report — the $28.92/MW-day clearing price. pjm.com
- PJM Interconnection, 2025/2026 Base Residual Auction report — the $269.92/MW-day clearing price. pjm.com
- PJM Interconnection, 2026/2027 Base Residual Auction report — the $329.17/MW-day clearing price. pjm.com
- Monitoring Analytics (PJM's independent market monitor) — data centers' 63% share of the 2025/26 price increase. monitoringanalytics.com
- Monitoring Analytics — data centers' 40% share of 2027/28 auction costs. monitoringanalytics.com
- IEEFA — analysis of PJM's Dominion Zone ("data center alley") load-growth forecast revisions. ieefa.org
- Lawrence Berkeley National Laboratory, "Queued Up: 2025 Edition" — median interconnection-queue duration by build period. eta-publications.lbl.gov
- LBNL — national interconnection-queue capacity and project-count data. emp.lbl.gov
- S&P Global, 451 Research forecast — U.S. data center power demand growth, 2026-2030. spglobal.com
Comments
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This isn't a story about your electric bill — it's about the market upstream of it, where grid operators pay power plants to simply be available when needed. That market just repriced faster than almost anything in the U.S. economy, and the reason isn't more homes or factories. It's data centers.