PJM's market monitor says data-centre demand has added $29.4 billion to capacity costs

Data-centre demand has added $29.4 billion to capacity market costs for all customers of PJM, the largest US grid, according to the quarterly State of the Market report from Monitoring Analytics, PJM's independent market monitor. It said the increase is irreversible and will grow significantly when PJM Interconnection holds its next capacity auction in December 2026.

Market monitor Joseph Bowring said PJM's energy market was competitive in the first nine months of 2026, but that the capacity auctions for the delivery years 2025/2026 through 2028/2029 were not, "primarily as a result of the inclusion of forecast demand for data centers." The report says PJM has failed to ensure data centres pay their own costs, as PJM's governors, the White House and a ratepayer protection pledge called for.

The monitor recommends leaving forecast data-centre demand out of the capacity market and requiring data centres to bring their own new generation. Prices are rising: the total cost of wholesale power in PJM rose 40.9% in the first nine months of 2026 to $111.61 per MWh, and the capacity cost component rose 81.1%.