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America’s largest electric grid has secured emergency federal authority that could allow some data centers and other large electricity users with backup generators to temporarily reduce their power consumption as officials prepare for what could become the system’s highest electricity demand in nearly two decades.
PJM Interconnection, which serves about 67 million people across 13 states and Washington, D.C., said Wednesday it expects electricity demand to reach about 166,147 megawatts on Thursday, surpassing the current summer record of 165,563 megawatts set in 2006.
The move underscores the growing challenge facing U.S. utilities as electricity demand accelerates after years of relatively flat growth, fueled by widespread air conditioning use during extreme heat, expanding artificial intelligence data centers and broader electrification trends.
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The grid operator said it received approval from the Energy Department for an emergency order under Section 202(c) of the Federal Power Act that, if necessary, would allow transmission operators to curtail electricity use by data centers and other large customers with backup generation before resorting to broader emergency measures.
PJM also received temporary relief from certain environmental permit restrictions for power plants through July 3, giving generators more flexibility to meet soaring demand.
To prepare, PJM has recalled generating units from maintenance, issued Maximum Generation and Load Management Alerts, and placed a Low Voltage Alert into effect to help maintain grid reliability. The alerts do not require any action from residential customers.
Wholesale electricity prices have already surged in parts of PJM’s footprint. In northern Virginia, home to the world’s largest concentration of data centers, spot power prices climbed sharply Wednesday as temperatures approached 100 degrees.
If Thursday’s forecast holds, it would mark PJM’s highest electricity demand in nearly 20 years.
Other grid operators are also preparing for heavy electricity use. New York’s grid operator has asked customers to conserve power during peak hours, while the Midcontinent Independent System Operator is monitoring conditions that could also challenge demand records this week.
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The emergency measures reflect increasing concerns about whether generation and transmission resources can keep pace with rapidly growing electricity demand, particularly as large AI data centers consume more power and prolonged heat waves drive air conditioning use higher across the country.
Reuters contributed to this report.
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