FERC Rejects PJM’s Plan to Protect Electricity Reliability and Consumer Bills from Data Centers

WASHINGTON D.C. – The Federal Energy Regulatory Commission (FERC) rejected PJM's Interim Resource Adequacy Service (IRAS), which would have required data centers to pay for their own new power supply and protected other customers from reliability issues when data centers demand more power than the grid can provide.

The following is a reaction from Claire Lang-Ree, advocate, Sustainable FERC Project, Climate & Energy, at NRDC (Natural Resources Defense Council):

“FERC’s decision leaves the public exposed to rolling blackouts and higher bills caused by data center electricity demand. In denying PJM’s proposal, FERC disregarded the White House’s Ratepayer Protection Pledge, where major tech companies promised to pay for the infrastructure their data centers need. Instead of requiring data centers to bring their own new capacity, FERC’s decision will force the public to continue paying for data center’s power supply. FERC also ordered PJM to continue providing uninterrupted service to new data centers beyond what the grid can handle, further degrading reliability. 

“PJM can, and should, redraft its IRAS rules to fix the technicalities FERC used to reject it and resubmit as soon as possible. At a minimum, PJM’s rules must require data centers to bring their own supply, and not allow them to raise electricity costs or cause blackouts. As PJM works to address FERC’s concerns, states still have a major opportunity to advance this concept through their own policies, unlocking reliable, affordable, and clean energy sources to meet the moment on powering growing energy demand.”

Background:
PJM Interconnection is the regional transmission organization (RTO) that manages the transmission and wholesale electricity market for about 67 million people in thirteen states and Washington D.C. PJM officially filed the IRAS framework with FERC on August 13, 2026. IRAS is a PJM proposal that makes reliable power for data centers conditional. Learn more in this NRDC blog.

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