Data Center Load Hits 9% of PJM's 2026 Wholesale Costs as Capacity Auction Falls 6.8 GW Short
Monitoring Analytics puts technology sector load at 9% of PJM's year-to-date wholesale costs, while the grid's most recent capacity auction cleared nearly 7 gigawatts below target for 2028/2029 delivery.
Data centers made up 9% of PJM's total wholesale electricity costs through the first part of 2026, according to Monitoring Analytics, the grid's independent market monitor. PJM's Western Hub spot was at $73.72 per megawatthour in early Friday (2026-08-28) trading, but the real weight of the technology sector's demand build is registering most clearly in forward capacity markets, not in day-ahead or real-time.5
The capacity auction results released during the week of July 13 (2026-07-13) showed the full scale of the shift. Total generator payouts for the 2028/2029 delivery year matched an all-time high of $16.4 billion. Monitoring Analytics president Joseph Bowring said data centers drove $6.3 billion of that — 38% of the entire auction charge.5,8
The auction also fell 6.8 gigawatts short of target. Most PJM zones cleared at $554.72 per megawatthour for 2028/2029, with the ComEd load delivery area settling at $776.69. OilPrice.com reported that absent the price cap constraining the prior auction at $325, the uncapped clearing level would have been roughly 70% above that baseline, implying suppressed prices are masking how tight the market has become.3
New supply is not closing that gap. Since 2024, only about 4 gigawatts of new and uprated capacity have entered PJM's capacity auctions against roughly 20 gigawatts added across the five prior auction cycles, per Canary Media's July 17 (2026-07-17) reporting on grid operator data. The interconnection queue tells a similar story: only 13% of capacity that applied for grid access between 2000 and 2019 had reached commercial operation by the end of 2024, with 77% of applications eventually withdrawn, per industry data cited by QZ.4,1
Demand has kept accelerating regardless. Global data center electricity consumption grew 17% in 2025, with AI-focused facilities expanding at 50%, per International Energy Agency estimates. U.S. data centers account for roughly half of the country's incremental electricity demand growth, the IEA's global energy assessment found. Virginia alone saw commercial electricity sales rise by nearly 30 million megawatthours between 2019 and 2025, driven largely by data center expansion, EIA data showed.1,2
First-quarter 2026 PJM power prices rose 76% year-on-year, with Monitoring Analytics attributing the bulk of that move to data center load growth. Set against the 9% wholesale cost share for 2026 so far, the technology sector's contribution to PJM's cost stack has grown large enough that it shifts aggregates.3
The grid operator tried to respond in late July (2026-07-28). PJM's board approved a backstop capacity auction targeting resources that can be online by June 1, 2032, and hired Charles River Associates to oversee a bilateral matchmaking process that launched with an RFP issued June 9 (2026-06-09). A parallel proposal would authorize curtailment of data center load at peak stress moments.6
Critics have argued the backstop mechanism addresses a deficit from a prior base auction but does not resolve the underlying problem — large new loads that have not yet materialized at scale in the grid's planning models. Canary Media's August 5 (2026-08-05) reporting framed PJM's broader strategy as effectively delegating the problem to states, asking them to either secure more generation or cut demand at peak through qualifying resources including batteries, demand-response aggregations, and virtual power plants.6,7
Timing uncertainty runs in both directions. Data center developers tend to announce aggressive commissioning schedules; the record of interconnection withdrawals — 77% of applicants since 2000 never reached commercial operation — suggests actual delivery frequently lags plans. If the new load ramp is slower than PJM's planning assumptions embed, near-term real-time prices could stay more contained than the capacity auction signals imply. The next base capacity auction will be the clearest test of whether the 6.8-gigawatt shortfall is narrowing or drifting wider.1,3