PJM Asks FERC to Curtail New 50 MW Data Centers Before Other Emergency Load Cuts
- FERC & Federal Policy & Markets Regulatory
Marin Holt
- 0
- 9 minutes read
- FERC docket: ER26-3380-000
- Capacity shortfall: 6.8 GW
- Large load threshold: 50 MW
- Backstop price cap: $555/MW-day
- Curtailment start: June 1, 2027
PJM Interconnection asked federal regulators on July 31 for permission to cut power to new data centers before it calls on any other emergency demand response, a reordering that would put the largest new customers on the grid at the front of the line when the system gets tight. The plan went to the Federal Energy Regulatory Commission as Docket ER26-3380-000. PJM runs the power market across 13 states and the District of Columbia for 67 million people, and it is asking for two things at once. The first is a one-time capacity auction, capped at $555/MW-day, to close a 6.8 GW shortfall in the 2028/2029 delivery year. The second is an Interim Resource Adequacy Service that would curtail large loads arriving after June 1, 2027 if they show up without bringing their own supply. PJM counts a customer as a large load at 50 MW or more, measured either at a single interconnection point or across several points inside a one-mile radius. The board ordered both filings in a decisional letter dated July 27.
What changed
PJM stakeholders already voted on a version of this package back in June, and the result was split. They endorsed the backstop auction. They rejected the large-load curtailment piece, and the board has now filed that piece regardless.
The practical change is one of sequence, which is easy to miss in a tariff filing but expensive to miss in a site plan. Until now a new large load in PJM sat in the same emergency queue as every other customer, and pre-emergency load management came first, drawing on the demand response customers who signed up voluntarily and get paid for the interruption. Under the Interim Resource Adequacy Service, a new large load that has not secured its own capacity gets cut ahead of all of them.
Enforcement reality
The trigger is not a rolling blackout. PJM would act as the system approaches emergency conditions, and that threshold is crossed considerably more often than a declared emergency. Because the obligation attaches to the load rather than to the company signing the lease, it follows the building.
Alongside the curtailment service, PJM wants a mandatory Large Load Registry covering every customer at or above the 50 MW threshold, which would report its location, its ramp schedule and whatever capacity it has lined up. PJM frames the registry as a fix for a load forecast that has missed repeatedly in both directions. Developers will read it as something closer to a call list.
Compensation is the loose thread, and it is a significant one. PJM proposes to pay for directed reductions at a FERC-approved rate administered by electric distributors in coordination with the states, but the filing does not settle what that rate actually is. Until it does, an operator cannot price the risk of being curtailed, and neither can the bank lending against the building.
Why It Matters
For anyone siting a load of 50 MW or more in PJM after June 2027, the filing supplies a straightforward reason to bring generation or storage to the site, which is precisely the behavior it was designed to produce. On-site gas, fuel cells and batteries stop functioning as insurance against a rare outage. They become the thing that keeps a facility off the curtailment list in the first place.
The cost argument behind all of this is already on the public record. Joseph Bowring, PJM’s independent market monitor, puts the capacity-cost increase attributable to data center load at $29.4 billion across the last four auctions. The Natural Resources Defense Council came out in support of the plan, describing the requirement that future data centers secure their own power as the single best thing PJM could have done. Those two rarely end up on the same side of a capacity market question.
FERC has not ruled, and until it does the June 1, 2027 date is a planning assumption rather than a deadline.
Critical Perspective
PJM wants new loads of 50 MW or more curtailed ahead of the demand response customers who are paid to be interruptible, and its own stakeholders rejected that ordering in June before the board filed it anyway. The filing sets no compensation rate, which means the party bearing the new risk cannot price it while the party imposing it has already scheduled its $555/MW-day auction. Precedent is not encouraging on speed either, because the Department of Energy had to issue an emergency order in July to let PJM push 50 MW-plus data centers onto backup power during a heat wave, well before any of this tariff language existed. If the emergency tool already worked without the Interim Resource Adequacy Service, what exactly is the new service buying beyond a queue position nobody has priced?
The backstop auction
The capacity half of the filing moves on a much shorter clock. PJM plans to run the Reliability Backstop Procurement from September 30 through October 21, with results landing near December 2. Its $555/MW-day cap is a steep step up from the $325/MW-day that applied to the last base auction. Winning resources take 15-year commitments and have to be online by June 1, 2032, and PJM has said the procurement could run as high as $20 billion.
What sits behind both halves is the same arithmetic. PJM has retired roughly 15 GW of capacity since 2022, and it projects that large loads could add as much as 70 GW by 2038.
Sources
- Utility Dive, 2026-08-03
- Utility Dive, 2026-07-28
- T&D World, 2026-07-30
- Foley Hoag, 2026-07-30
- National Law Review, 2026-07-29
