DOE clears PJM to curb data centers

The U.S. Department of Energy on May 18 issued an emergency order allowing PJM Interconnection to direct backup generation at data centers and other major facilities during grid emergencies. The order, issued under Section 202(c) of the Federal Power Act, followed a PJM request filed on May 17 and was set to run from May 18 through May 20. DOE said the move was aimed at helping avoid blackouts in the Mid-Atlantic during a heat wave and elevated transmission and generation outages. ### What did DOE actually authorize? DOE Order No. 202-26-23 authorizes PJM to deploy backup generation resources at data centers and other major facilities if needed. PJM is also authorized to call on its transmission owners and electric distribution companies to implement the order. DOE said the action followed PJM’s request for emergency authority and cited a statutory emergency in the PJM region tied to a sudden increase in demand and shortages of electric energy and generation facilities. (energy.gov) The order does not create a permanent new market rule. PJM said in its May 17 filing that it wanted authority to direct customer-owned backup generation facilities to operate if needed to avoid or mitigate an Energy Emergency Alert level 3 during unusually hot mid-May conditions. (energy.gov) ### Why are data centers at the center of this? PJM serves 67 million people and has been grappling with a surge in large-load interconnection requests, especially from data centers. In January, PJM’s board said it would take a series of actions in 2026 to address the challenge of integrating new data centers and other large-load customers while preserving reliability and affordability. (pjm.com) PJM stakeholders last month advanced a package that includes a new emergency procedure for large loads with backup generation. PJM said the curtailment approach would be used infrequently, for limited durations, and only when necessary to prevent broader system impacts. ### What does this say about the grid right now? (insidelines.pjm.com) PJM emergency postings on May 19 showed low-voltage alerts and local load relief warnings in parts of its footprint. Those notices came as DOE said the region faced heat, maintenance-related outages and reliability risks. Congressional Research Service said in a January 2026 report that U.S. data center electricity use in 2023 was about 176 terawatt-hours, or 4.4% of total U.S. electricity consumption, and some projections show it could double or triple by 2028. (insidelines.pjm.com) That broader growth has fed the debate over whether new large loads should face different reliability and cost rules than traditional customers. (emergencyprocedures.pjm.com) ### Where does the price signal show up? SEJ reported that PJM power prices rose almost 76% year over year in the first quarter. That figure has become a shorthand in the policy debate over how quickly data-center demand is changing the economics of the regional grid, though pricing reflects multiple factors, including supply constraints and market conditions. (congress.gov) PJM has also said its large-load work is intended to preserve affordability as well as reliability. In January, the grid operator said its 2026 actions were designed to address “multiple challenges” tied to new data centers and other large-load customers. ### What are lawmakers trying to change? Senate bill S. 3852, titled the “Guaranteeing Rate Insulation from Data Centers Act” or the “GRID Act,” was introduced on Feb. 11 by Senators Josh Hawley and Richard Blumenthal. (sej.org) The bill would impose requirements on data centers to prioritize residential ratepayers, matching the broader push to keep upgrade costs from being shifted onto households. (insidelines.pjm.com) The bill’s introduction puts Congress alongside DOE and PJM in the same policy lane: emergency dispatch authority on one side, and cost allocation for grid upgrades on the other. That combination is beginning to shape how large compute loads connect to the grid and what conditions they may face when reliability is tight. That reading is an inference from the DOE order, PJM filings and the text of S. 3852. (congress.gov) ### What happens next? The DOE emergency order was set to expire on May 20 unless extended or replaced. PJM’s filing and stakeholder process indicate the grid operator is also working on longer-term procedures for large loads with backup generation, while S. 3852 remains in the Senate Energy and Natural Resources Committee. (energy.gov) (pjm.com)