The Trump administration and a bipartisan group of governors on Friday sought to push PJM Interconnection, the operator of the largest U.S. power grid, to act quickly on rising electricity demand tied to artificial intelligence and data centers. The White House framed the issue as a race for computing and jobs while warning that voters are increasingly concerned about the pace of electricity price increases and the risk of future reliability problems.
Interior Secretary Doug Burgum told reporters at the Eisenhower Executive Office Building that the demands of AI and the resulting “power and the productivity that comes with that” would “transform every job and every company and every industry,” and he said the U.S. needed to ensure it can provide that power “in the race that we are in against China.” Energy Secretary Chris Wright said their message to PJM was intended to be blunt: “we know the answer,” and the answer, he said, is the ability to build new generation that can accommodate new jobs and “new growth.”
The White House and the governors—Glenn Youngkin of Virginia, Wes Moore of Maryland and Josh Shapiro of Pennsylvania among them—pressed PJM to take specific steps. They called on PJM to hold a power auction for tech companies to bid on 15-year contracts to build new power plants, with the argument that data-center operators, not regular consumers, should shoulder the cost of new generation. They also urged PJM to contain consumer costs by extending a wholesale electricity payments cap PJM imposed last year under pressure from governors, which limited increases of payments through mid-2028.
PJM was not invited to the event, and it said it would review the White House and governors’ recommendations. Still, after searching for months for options to meet rising electricity demand, the grid operator issued its own plan later Friday. The plan included an approach that would require utilities and markets to fast-track generation and also suggested that utilities could adjust how data centers use power during power emergencies, a concept the tech industry opposed.
A core element of PJM’s plan involves adopting a formula to cut power during emergencies for big energy users that rely on the grid for electricity, according to the AP report. The report said data centers typically have diesel-fueled backup generators that are designed to keep their operations running during outages, and that they had envisioned using that backup power for emergencies rather than as a mechanism to help grid operators manage overall demand. PJM’s plan also calls for fast-tracking the interconnection of power plants that data centers want to build, and it would rely on capacity decisions tied to grid conditions.
Officials said the administration and governors face a constraint: they do not directly have authority over PJM, which operates the mid-Atlantic grid. They pointed instead to the regulatory structure, noting that grid operators are overseen by the Federal Energy Regulatory Commission, which is chaired by an appointee of President Donald Trump. The push also comes as the report noted that ratepayers in the PJM footprint—covering all or parts of 13 states stretching from New Jersey to Illinois, plus Washington, D.C.—are already paying billions to underwrite power supplies for data centers, including some that have not yet been built, analysts say.
Tech industry groups, meanwhile, said on Friday that they are willing to pay their share. The Information Technology Industry Council, representing companies including Google, Meta, Microsoft and Amazon, welcomed the White House announcement and said it was seeking “to craft solutions to lower electricity bills,” adding that its members are committed to “making investments to modernize the grid and working to offset costs for ratepayers.” The Edison Electric Institute, representing investor-owned electric companies, said it supports the concept of tech companies bidding and paying for contracts to build new power plants.
Still, outside experts said the framework is complex and may not be straightforward to implement. Rob Gramlich, president of Grid Strategies LLC, said the idea could be “a new and creative one,” but he also said it was unclear how it would work within existing industry structures and state and federal regulations. Gramlich pointed to factors including how long industrial construction permits typically take in the mid-Atlantic region compared with places such as Texas, and he said some utilities in many PJM states that have deregulated did not sign up power plants to long-term contracts.
In that context, Gramlich said electricity ended up being available to tech companies and data center developers with large power needs, which then increased stress on the grid. “States and consumers in the region thought that power was there for them,” he said, “but the problem is they hadn’t bought it.”