PJM Interconnection, the largest US power grid operator, plans to curtail electricity supply to large data centers during shortages starting 2027.

Rising electricity demand from data centers is pushing PJM Interconnection, the largest power grid in the U.S., to adopt temporary cutoffs for major users during supply shortfalls. The measure is set to begin in June 2027 and will target facilities with loads of 50 megawatts or more. PJM is also conducting additional auctions for new generating capacity.

The approach mirrors longstanding demand response programs already used for major industrial customers, including manufacturers. Customers whose electricity is interrupted receive compensation, with advance notice ranging from 30 minutes to several days depending on expected demand conditions.

Data centers are projected to consume four times more electricity by 2035 than they do today. Many data centers favor diesel generators for backup power because the fuel is widely available and can be stored on-site. Federal rules allow these generators to operate for up to 50 hours per year during demand response events, and up to 100 hours annually when emergencies and maintenance are included.

The policy comes amid broader scrutiny of data center power demand in PJM's territory, which stretches from Virginia to Illinois and serves 67 million customers. Wholesale electricity prices have nearly doubled over the past year, and PJM's independent market monitor blames data centers for much of that increase.

This week, Vantage Data Centers came under criticism for its apparent coordination with Virginia environmental regulators to cast doubt on a report stating that diesel backup generators could cause tens of millions of dollars in annual health damage for residents living near a 96-megawatt data center in Northern Virginia.

Ontario's Etobicoke Greenway transmission project illustrates how grid operators are adding capacity and enhancing reliability as electricity demand rises. The new 230-kilovolt line can deliver up to 300 megawatts to parts of the Greater Toronto Area and is part of a broader buildout plan, including the proposed Toronto Third Line, as regional demand is forecast to continue climbing.