PJM Is Taking On Challenges to Maintain Reliable Grid

Maintaining a reliable electric supply for the Mid-Atlantic region is the mission of regional transmission organization PJM Interconnection, but the independent entity faces several urgent challenges to continue to meet that goal.

Stephen Bennett, senior manager of governmental services for PJM outlined those pressing needs that extend well into the future during the Center for Energy Policy and Management’s recent webinar “Meeting the Challenges of the Electric Grid: PJM’s Role”. The webinar recording can be viewed here.

PJM manages the wholesale electric grid for all or part of 13 states, including Pennsylvania and Washington, D.C., and is responsible for ensuring reliable electric service at all times to more than 67 million people. The grid is facing a rapid increase in demand for electricity from a growing number of energy-intensive data centers and industrial projects and continuing electrification of vehicles and residences.

At the same time, the amount of available electric generation is tightening as fossil-fuel fired plants that provide around-the-clock electricity are retiring due to policy and economic pressures, and the number of new generation projects joining the grid is not keeping pace due to a number of factors.

“We have to make sure the high-voltage transmission grid is planned not just for today, but the next 10, 15, and now 20 years into the future,” Bennett said, explaining that building new generation sources is an expensive process that requires long lead times.

Bennett talked about how a grid once dominated by coal-fired plants has given way to cleaner, abundant natural gas, and how more renewable energy sources are joining the grid. However, PJM is now facing growth in electric demand at levels not seen in more than a decade, much of it from the proliferation of AI data centers. He said this trend is being seen not just in PJM’s grid, but nationally and globally.

In 2016, peak electric demand was expected to grow to 165 megawatts (MW) by 2030. Now, projections are that close to 205 MW of power will be needed at peak demand times to ensure a reliable grid by 2032.

At the same time, PJM is facing the retirement of fossil-fuel generating plants due to age and air emission policies. About 40 gigawatts of capacity is expected to be lost in the next five years. While there are a number of renewable energy projects, primarily solar, seeking connection to the grid, they don’t supply constantly available power, unless paired with battery storage, which is now very expensive.

As a result of the increasing demand and declining resources, prices for wholesale electricity have been rapidly increasing. “PJM recognizes the need to expedite supply,” Bennett said, adding the RTO has taken a number of steps and has instituted a price floor and cap on wholesale capacity costs to keep costs in check for the next two years.

However, Bennett said policy changes are need to avoid pushing existing generation off the grid until adequate replacement is in place, and states need to make permitting and siting of generation projects more efficient to speed up construction.