Data Centers Drove $6.3 Billion of PJM’s Latest Capacity Auction Cost, Market Monitor Says

Data centers accounted for $6.3 billion, or 38%, of the $16.4 billion in charges from PJM Interconnection’s most recent capacity auction, Joseph Bowring, president of the grid operator’s independent market monitor, said in an email to Utility Dive reported on July 20, 2026, as PJM prepares to file a capacity backstop proposal with federal regulators. Across the last four base residual auctions in the mid-Atlantic and Midwest region PJM runs, Bowring’s firm, Monitoring Analytics, puts data-center-driven capacity charges at $29.4 billion, or 46% of the $63.6 billion in total capacity charges over that stretch.

The Data

The $6.3 billion covers one auction. The $29.4 billion covers four, and it is the harder number: across four procurements, the monitor assigns close to half of what the region paid to keep capacity on the system to a single customer class. The $16.4 billion total matches PJM’s 2028/2029 Base Residual Auction, which cleared at the $325/MW-day federal price cap and still finished 6,831 MW short of its reliability requirement. Monitoring Analytics has not published the analysis behind the split. Bowring said it would come out in a few weeks.

Why It Matters

Capacity charges are recovered from load, so a cost share attributed to one class is a bill paid by every other class in the meantime, residential, commercial and industrial customers included. That is the argument behind the remedies Bowring has put forward: run a separate capacity auction for data centers, require them to contract for their own generation, and where self-supply is not available, hold them to 15-year capacity contracts rather than the one-year product everyone else buys, bought three years ahead. “PJM is continuing to act like it’s business as usual,” Bowring said. “You have to open your eyes and recognize that it is really a paradigm shift.” PJM is moving on a narrower track. Its Board of Managers expects to file a backstop auction proposal at the Federal Energy Regulatory Commission in July 2026 and to run that auction as soon as September 2026, procuring the roughly 6.8 GW shortfall from the last base auction under a stakeholder-endorsed cost cap of $555/MW-day.

The Gap

The attribution is a finding without a published method. Splitting a capacity charge across customer classes depends on which load forecast is used and how much of the price increase is assigned to demand growth rather than to supply that did not show up, and none of that is public yet. PJM has not endorsed the split. The analysis also does not answer the question a state regulator will ask first, which is what the last four auctions would have cost with no data-center growth at all. Until the report lands, the 46% share is a claim by the market monitor about a market it monitors, and it should be read that way.

Sources

• Utility Dive
• Conduit Street (Maryland Association of Counties)
• Foley Hoag, Energy & Climate Counsel
• Utility Dive

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