The burst of current and planned data center development in mid-Atlantic and Great Lakes states led to a 56 percent increase in overall wholesale electricity prices to $80.5 billion last year, the region’s market monitor reported Thursday.
“The price impacts have been very large and are not reversible,” said Joseph Bowring, president of Monitoring Analytics, in his annual “state of the market” report for PJM Interconnection, the largest U.S. regional power market.
Prices will continue to rise unless power supply challenges tied to demand from large data centers are resolved in the next few months, Bowring said. PJM has fallen far behind the eight ball in connecting power generation fast enough to meet growing demand from U.S. tech companies developing artificial intelligence, he added, putting the region increasingly at risk of power shortfalls.
PJM coordinates power flows to 67 million people in 13 states and the District of Columbia and operates markets that determine spot and long-term electricity prices.
