Key energy costs rose 50% last year in biggest US power grid and data center hub, grid watchdog says
By Laila Kearney
NEW YORK, March 12 (Reuters) - Energy costs in PJM Interconnection rose by about 50% in 2025, compared to a year earlier, as the largest U.S. grid struggled to keep up with power demands from data centers, according to a report by PJM's independent watchdog on Thursday.
Rising data center demand, both current and forecast for the years ahead, is creating an urgent affordability problem in PJM, according to the annual report by Monitoring Analytics, which acts as PJM's independent market monitor.
In 2025, the real-time load-weighted average power price in PJM - a measure that reflects what power typically costs when people are actually using it the most - rose from about $34 to $51 per megawatt‑hour.
PJM covers 13 states in the Mid-Atlantic and Northwest U.S., including the world's biggest data center hub in northern Virginia. Prices in the market affect the power bills of about one in five Americans.
Federal energy regulators and PJM, which covers 13 states that include the world's biggest data center hub, are scrambling to find ways to manage power demand brought by Silicon Valley's quickly proliferating data centers.
Monitoring Analytics, in the report, supported the increasingly popular notion that data centers bring their own electricity supplies to the market instead of using up existing resources on the grid.
PJM's method for managing that data center load should ensure that costs to supply the server warehouses should not fall on the public, the independent market monitor said.
Up until recently, energy-intensive data centers connected easily to the PJM grid, but limited power supplies from existing power plants have slowed that ability.
Last year, power generation from coal electricity-generating units increased 19% and generation from oil units jumped by 30 percent. Electricity generated from wind, meanwhile, grew by 2.5% and solar surged by 41 percent.
