Pennsylvania governor negotiates a deal with PJM over power prices

By Peter Behr | 01/29/2025 06:52 AM EST

Josh Shapiro has pressed the Eastern grid operator for answers to high prices amid tighter electricity supplies.

Pennsylvania Gov. Josh Shapiro speaks at a campaign event at the IBEW Local 5 union hall in Pittsburgh on Sept. 2.

Pennsylvania Gov. Josh Shapiro. Susan Walsh/AP

Pennsylvania Gov. Josh Shapiro and PJM Interconnection, the largest regional grid operator, announced a preliminary agreement Tuesday to cap prices paid to electricity generators for future supply that Shapiro said could save consumers as much as $21 billion.

The Democrat is pressing PJM to act quickly to head off rising wholesale power prices. Through a complex annual auction for future electricity guarantees, bids by generators to supply power get passed on to utility customers.

Escalating demand from the U.S. tech industry has added urgency to concern about rising costs and tightening power supplies. Older coal plants are closing faster than new generation is being brought online. As a result, the regional grid serving some 65 million Americans in the East faces potential power shortages in extreme weather. That has a direct effect on power prices.

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“Over the last several years, demand for energy has risen rapidly but PJM has been slow to allow new power sources onto its grid — and as a result, PJM capacity prices have skyrocketed,” Shapiro said in a statement.

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