PJM to Cut Power to Data Centers to Prevent Blackouts

PJM Interconnection, operator of the largest U.S. electrical grid, will temporarily cut power to data centers and other large users during shortages to prevent blackouts. The decision follows an auction that failed to secure enough new generating capacity. Cuts begin June 2027, applying only to data centers of 50 megawatts or larger. Affected customers will be compensated, with advance notice of 30 minutes to a few days. The move is expected to push data centers to develop on-site power, likely relying on diesel generators, which are costlier and more polluting. Federal rules allow such generators up to 50 hours per year for demand response and up to 100 hours for emergencies. Vantage Data Centers faced criticism for coordinating with Virginia regulators to downplay health impacts of diesel generators near a 96 MW facility in Northern Virginia. PJM has been criticized for managing new capacity and large users; wholesale electricity prices have nearly doubled in the past year, with its independent market monitor attributing much of the increase to data centers. PJM's territory spans from Virginia to Illinois, serving 67 million customers.