Lawmakers Across PJM Region Push Grid Reforms to Prevent Data Center Costs from Hitting Consumers (Joliet, IL) – A bipartisan coalition of lawmakers from across the PJM Interconnection region is calling for sweeping changes to the nation’s largest electricity market, warning that the rapid expansion of data centers could drive up energy costs for millions of households and small businesses.
The PJM Legislators Collaborative, which represents 13 states and the District of Columbia, issued a formal demand this week urging grid operator PJM to overhaul how it handles surging electricity demand from large-scale data centers and artificial intelligence infrastructure.
In a letter to PJM Board Chair and Interim CEO David E. Mills, the group outlined concerns that current market rules allow the costs of powering energy-intensive data centers to be shifted onto everyday ratepayers.
“Families and small businesses should not be forced to subsidize the massive energy demands of private data center expansion,” said Illinois State Sen. Rachel Ventura, a member of the coalition.
PJM manages the electric grid serving roughly 67 million customers across a large հատված of the Midwest and East Coast. Lawmakers say the system is under strain as data center growth accelerates faster than new power generation can come online, raising both reliability concerns and electricity prices.
At the center of the dispute is PJM’s Base Residual Auction, the primary mechanism utilities use to secure future power supply. Legislators argue the auction currently treats routine demand growth—such as population increases and electric vehicle adoption—the same as the massive, concentrated energy needs of data centers.
That dynamic, they say, forces residential customers to compete with global tech companies for limited power supply, driving up prices across the board.
To address the issue, the coalition is proposing a four-part framework aimed at protecting consumers while maintaining grid reliability.
Among the key proposals is a requirement that data center developers shoulder the full financial risk of the new infrastructure needed to support their operations, rather than passing those costs onto the public. Lawmakers are also pushing for a separate “reliability backstop” auction targeted specifically at large energy users, which would require them to secure their own power supply.
The group is calling for that auction to take place in December 2026, arguing that an earlier timeline could encourage speculative projects that fail to deliver meaningful capacity.
In addition, lawmakers want the market to prioritize genuinely new power generation—such as new plants, imports, or demand response programs—rather than extending the life of aging facilities through long-term contracts.
Another major proposal would temporarily remove large data centers from the primary capacity market unless they “bring your own capacity,” a model that requires companies to independently secure power resources.
Supporters say the changes would help stabilize prices and prevent households from absorbing the costs of rapid industrial growth.
“Ratepayers shouldn’t have to compete with global corporations for power,” said Maryland State Sen. Katie Fry Hester, who emphasized that residents in her state are already seeing higher electric bills.
Illinois State Sen. Graciela Guzmán echoed those concerns, arguing that communities are already burdened by rising energy costs.
“These corporations must pay their fair share, invest in their own infrastructure, and stop passing the costs and consequences onto our families,” Guzmán said.
Lawmakers from other states, including Virginia, Pennsylvania, Indiana and Delaware, also voiced support for the reforms, noting the need to balance economic development with affordability and grid stability.
Virginia, which hosts the world’s largest concentration of data centers, highlighted both the economic benefits and the significant energy demands associated with the industry.
“A reliability backstop ensures that the cost of powering these facilities is borne by the companies building them — not by families and small businesses already struggling with higher bills,” said Delegates Michelle Maldonado and Rip Sullivan.
The coalition said it will continue working with governors, regulators and consumer advocates to push for changes, emphasizing that the stakes are high for millions of customers across the PJM region.
“The impact of rising energy costs is something we all share,” said Delaware Rep. Debra Heffernan. “We owe it to our constituents to make sure that large energy users like data centers are paying their fair share.”
The proposed reforms are part of a broader effort to adapt the energy market to rapid technological growth, particularly as demand from artificial intelligence and data processing continues to surge.
For now, lawmakers say the priority is clear: ensuring that the expansion of the digital economy does not come at the expense of everyday consumers.
Lawmakers Across PJM Region Push Grid Reforms to Prevent Data Center Costs from Hitting Consumers
