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America's Biggest Power Grid Operator Has an AI Problem - Too Many Data Centers (msn.com) 61

Posted by msmash from the servers-up-lights-out dept.
America's largest power-grid operator, PJM, which delivers electricity to 67 million people across a 13-state region from New Jersey to Kentucky, is approaching a supply crisis as AI data centers in Northern Virginia's "Data Center Alley" consume electricity at an unprecedented rate.

The nonprofit expects demand to grow by 4.8% annually over the next decade. Mark Christie, former chairman of the Federal Energy Regulatory Commission, said the reliability risk that was once "on the horizon" is now "across the street." Dominion Energy, the utility serving parts of Virginia, has received requests from data-center developers requiring more than 40 gigawatts of electricity -- roughly twice its Virginia network capacity at the end of 2024. Older power plants are going out of service faster than new ones can be built, and the grid could max out during periods of high demand, forcing rolling blackouts during heat waves or deep freezes.

In November, efforts to establish new rules for data centers stalled when PJM, tech companies, power suppliers and utilities couldn't agree on a plan. Monitoring Analytics, the firm that oversees the market, warned that unless data centers bring their own power supply, "PJM will be in the position of allocating blackouts rather than ensuring reliability."
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America's Biggest Power Grid Operator Has an AI Problem - Too Many Data Centers More

America's Biggest Power Grid Operator Has an AI Problem - Too Many Data Centers

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  • Economics 101 (Score:4, Insightful)

    by Locke2005 ( 849178 ) on Tuesday January 13, 2026 @02:10PM (#65921418)
    The way to handle equitable distribution of limited resources is to INCREASE THE PRICE. Those data centers have BILLIONS, go getcha some of that $$$!

    • Re: (Score:3, Insightful)

      by random_nickname_pls ( 6199950 )
      It's not as simple as charging them for what they use, even if they increase the rate. The massive needs of a data center will mean the utilities (delivery, transmission, and generation are typically separate companies) will need to increase capacity significantly. Unless the data center owner is going to pay a massive connection fee, the utilities all need to front a lot of money for this build-out. The cost of this build-out is what is being passed on to the residential customers. Now imagine the loss

      • Re:Economics 101 (Score:5, Interesting)

        by DamnOregonian ( 963763 ) on Tuesday January 13, 2026 @02:32PM (#65921482)
        I operate 6 datacenters.
        We do, indeed, pay massive connection fees, and usually pay for the required build-out on top of that.
        We do, however, pay a significantly cheaper rate than residential customers.

        MS, at least, is offering to pay residential price for their electricity, which should probably become the norm for these datacenters that aren't hosting other people's infrastructure.

        • Re: (Score:3, Insightful)

          by 0123456 ( 636235 )

          I don't see why people who live there should have to pay more so people on the other side of the world can generate Emma Watson pr0n.

          • Ya, I mean, I understand your concern.
            However, utilities are also in it to make money, and we have money to give them.

            I think "the fairness of capitalism" is perhaps a larger scoped problem.

            I wonder if you feel the same way about whatever local industry exists where you live.
            "I don't see why my air needs to stink so people on the other side of the country can eat chicken."

            I don't mean to dismiss your concern... only to say that "it's complicated."

            • Re: (Score:3)

              by 0123456 ( 636235 )

              Local industry actually produces something useful and provides jobs for the people who live there.

              AI data centres provide very few jobs and are designed to eliminate jobs all over the world while also making Emma Watson pr0n.

              It's the most absurd misallocation of resources I've ever seen in my life.

              • Won't somebody PLEASE think of the Emma Watson pr0n!!!

                • back in my day it was Natalie Portman, naked and petrified, covered in hot grits.

                  It was a simpler time.

                  • I remember that, I just can't remember if it was a slashdot meme or a Usenet meme. I'm OLD. (And I never thought that one was funny.)

                • Won't somebody PLEASE think of the Emma Watson pr0n!!!

                  Unfortunately, too many people are already thinking of this.

              • Data centers provide many jobs. Like I said, I operate 6 of them.
                Usefulness is in teh eye of the beholder (or the payer).

                Your entire argument can be summed up as: "I don't find datacenters useful, therefor bad."
                That's not an argument. It's a value judgement.
                • I don't operate any commercial data centers, but I occupy cages in 14 of them, and have been working with data centers for over 30 years.

                  After a datacenter is built and operational, the number of new jobs are trivial and mostly low-paid.

                  As one example, our "primary" (not really any such thing anymore, it was just the first) in Santa Clara operates about 150K sq ft. Unless they are building a new cage or doing other significant work, there are two employees on site - the security person and a guy that ha

                  • I don't operate any commercial data centers, but I occupy cages in 14 of them, and have been working with data centers for over 30 years.

                    Excellent. 20 years here. We also have cages in 6 or so non-self-operated DCs for national PoPs.

                    After a datacenter is built and operational, the number of new jobs are trivial and mostly low-paid.

                    This is completely untrue.

                    As one example, our "primary" (not really any such thing anymore, it was just the first) in Santa Clara operates about 150K sq ft. Unless they are building a new cage or doing other significant work, there are two employees on site - the security person and a guy that handles hands and eyes, shipping and random maintenance.

                    Then they have outsourced all of their facilities work, which is a shit-ton.
                    That's still providing jobs.

                    There's a manager somewhere, but not on site.

                    It is true that there is not normally a manager on-site.
                    However, there will be a facilities manager for the facilities crew for a group of local datacenters.
                    That's still providing jobs.

                    The intercom button goes to someone at a call center who is always terrible at connecting you back to the on-site security guy, which is the only reason to hit the button. The labor strategy was clearly designed by the same folks who staff groceries or fast food - minimize labor at all costs, and if it takes a customer paying 7 figures a month an hour to connect with someone there, well, what are they going to do about it?

                    Funny enough- you have very closely described my experience with CoreSite in LA, but the exact opp

                    • Re: (Score:2)

                      by toddz ( 697874 )

                      After a datacenter is built and operational, the number of new jobs are trivial and mostly low-paid.

                      This is completely untrue.

                      I assume you are calling it untrue based on datacenters that are regularly undergoing changes and upgrades. I feel that these AI datacenters are more like traditional Telecom CO, you build it, connect everything and only return for maintenance. Maybe I'm wrong but even AI says these data centers only need monthly, quarterly, and yearly maintenance.

                    • Funny enough- you have very closely described my experience with CoreSite in LA, but the exact opposite of my experience with Hurricane Electric up in Fremont.

                      There are a lot fewer people working in that building (HE Fremont 2) than when it was an Apple factory.

                    • Datacenters have a significant facilities load.
                      I won't say that a single data center fully occupies an entire facilities team, but it adds to its occupation, and you definitely don't just have one (if you want to maintain your uptime)

                      I'm not trying to say that the datacenter is, in itself, full time employment for a massive team of people, but it contributes to the reason they have jobs.
                      We keep between 6 and 12 guys in each area we have a cluster of datacenters for facilities, another 6 guys in each are
                    • No question about that.
                      If Apple were to build a factory there today? Maybe not.

                • > Data centers provide many jobs. Like I said, I operate 6 of them.

                  So what you're saying is there could be at least 5 more job openings...

                  =Smidge=

                  • I don't mean myself, personally ;)
                    I mean I have a senior managerial and engineering role in an organization that does.

            • I think "the fairness of capitalism" is perhaps a larger scoped problem.

              There's also the more functionally important question of the efficiency of market dynamics. In a perfectly functioning market, raising electricity prices would entice new producers and vendors. However, that doesn't happen in our electricity market because of obstacles to new producers or existing producers who wish to increase production. These obstacles are a combination of government regulations, technology, supply chain, financial, and location (where to plug into the grid, which locations are feasib

          • Indeed! Offshore those datacenters! I think there is some room in China?
            We did this with industry. Do we do this again with datacenters? Tough choice...
        • You say massive, but what is massive. If the utility has to build say a new 10GW plant, and costs are roughly 2K/kw (2 bucks/w) are you paying a 10B dollar connect fee? That is still a 50% discount to the build cost.
          • Well, to be fair- build-out for us has never required the construction of a new power plant, lol.
            Build-out for us is installation of multi-megawatt transformers (that are owned by the utility and stay after we're gone- they're not ours) near or on the property, and upgrades to the transmission lines feeding them. In one property, we had to pay for the building of an entire substation.
            That is separate from the connection fee for a multi-megawatt connection.

            I also think it is probably a little bit disinge

        • We do, however, pay a significantly cheaper rate than residential customers.

          That is often for a good reason. A foundry I did some work for got their rates much cheaper because they owned the transformers and switch gear. The utility company fed them directly from the same HV line that powered the substations and that's all that they were responsible for. Anything after the end of those wires was the foundry's problem to deal with. So they kept a few million bucks worth of spares for those on site because some of it was non-US voltage and took a minimum of 18 months to get a repla

          • Interesting- we do not own our transformers and switching gear. But we did pay for it.
            One of our DCs required we pay for the construction of a substation- 30MW. I bet still small peas next to a foundry's induction furnace.

            What it takes to feed those induction furnaces made the hair on the back of my neck stand up lol

            What freaks me out more about our "big one" is the room with the batteries. I don't know why... but megawatts of DC supply gives me the heebie jeebies.

      • Anything that uses over a certain percentage of power for said plant should be directly charged for infrastructure upgrades required to deliver it.

        Telecoms do that already - you want a special fiber line, shoot you want a connection to an area that isnâ(TM)t yet served - you pay up front for that connection. Iâ(TM)ve seen Comcast charge $10k to extend their service to a new neighborhood.

      • Re: (Score:2)

        by HiThere ( 15173 )

        It's more than that: "Older power plants are going out of service faster than new ones can be built,". It's timing. This is a SUDDEN increase in requirements. ("Sudden" relative to the time required to build new facilities.)

      • Just tell the data centers that they need to have their own power plants

    • Companies don't just uniformly increase prices they pick and choose consumers.

      So a reliable consumer like a business is more desirable than an unreliable consumer like a individual person.

      In Practice this means that they're going to prioritize business customers over you and they are much more likely to raise your rates than business rates.

      Because electricity tends towards Monopoly we do have regulations in place to limit that but well, we've been fighting those dastardly bureaucrats for the las

      • There will come a time that you, the consumer, will not get any power from the grid, no matter how much you want to pay. Energy-security, that will be the result of AI in datacenters in their current form.

        AI, in its current form, deserves to die in the biggest bubble implosion man ever knew or should want to know. AI, as a technology can be a boon for consumers. Its current form sure isn't it.

        But it won't be an electricity problem alone. Datacenters tend to consume a lot of water too for cooling. And once t

        • Re: (Score:1)

          by Anonymous Coward
          Honestly, it seems like this may be the straw that drives people away from the grid entirely. Speaking only for myself, of course, but give me some decent batteries and some solar panels and a generator to charge them, and both the grid operators and the hyperscalers can all go fuck themselves. I've had it with the lot.
          • Are home battery systems that are not Li-Ion available yet? I'd prefer to fill my basement with batteries that don't catch fire. I suspect good, cheap Sulphur batteries will be available within a year. They don't have the energy density for EVs, but they have the safety, long life, and economic feasibility we want for fixed energy storage, And I'm pretty sure China is way ahead of us on this... Thanks, Trump!

  • Just charge like water, use more pay more (Score:4, Interesting)

    by Cognivore ( 301236 ) on Tuesday January 13, 2026 @02:14PM (#65921436)

    I don't understand why heavy users aren't charged more, like water. In my town water usage is tiered, and those upper tiers charge you a lot more per gallon than if you conserve. C'mon, electric company, do the same, and make those upper tiers juicy and you can finance yourself into great infrastructure upgrades (think power lines in forests that for some reason catch fire frequently). Those AI companies are flush with inventory money, they can afford it, fleece the fuck of them for taking our electricity to do their stupid AI shit.

    • I live in a condo.
      Our bulk connection rate is so much cheaper than individual rate that we don't even individually charge units. It goes into the COA dues, and is basically a rounding error.

      You are right, that within a class, the more you use, the more you pay- however, people who have bulk connections pay cheaper in water, and in electricity.

    • Re: (Score:2)

      by PPH ( 736903 )

      It depends on where you are, from a resource cost (fuel cost) point of view. Out here in the Pacific Northwest, our "fuel cost" is nearly zero. Because it's primarily hydroelectric. What is expensive is the capital cost of the grid infrastructure but needed to serve each customer's peak demand. But politicaly, it was advanageous to "convert" those charges to an equvalent energy consumption fee. Dollars per kilowatt-hour. In order to prevent a tragedy of the commons. "I"'ve paid my fee for peak use this mont

      • There was a story about a town in NY near Niagra Falls. They had an old agreement with Canada for a set amount of juice at very very very low prices. The crypto miners moved in and used it forcing residents to pay way more since the allocation of cheap juice was oversubscribed. Yep tragedy of the commons.
    • Even if they got the cash on hand to expand, they cannot. PJM supply mostly supplied by Nuclear, Natural Gas, and Coal, renewables is small %. You cant spin up nuclear supply quickly, GE gas turbines are back -rdered years. Coal, who knows, thats a local EPA issue. You can see the break down on PJM site: www.pjm.com

    • Corporations are more important than people.

  • If takes half of power plant's output to drive a datacenter, then they can damn well pay for the plant.

    Don't let them connect to the grid until they do. Or, require that they be able to generate most of their power locally, either onsite or at a nearby site.

    These are billion-dollar investments. Make them buy or build their facilities in way that doesn't affect the state/county/local population.

  • Im supplied by PJM through Comed in IL, im also on the hourly plan to gamify the cost to save $$. Let me say, the price spikes during the summer hot days were crazy. Im still saving money vs static $/KWH for supply, but wow what a ride during the summer.
    • With enough data centers, there will be very few of those cheap hours to game.
      • Thats right, Comed and the governor are looking at other suppliers and get off PJM due to its density of data centers in the mid-atlantic.

  • If you possibly can. It's THE way to address peak demand problems and, with battery storage, a solution to continuity.

    • Peak demand is very local. Here it's winter nights. We also have temperature inversions that bring heavy overcast and dead calm and those conditions can easily last a week.

      Other places have peak demand on those long sunny summer days. That set of conditions is an easy kill for solar.

  • Electric companies should first make sure data centers have their own Solar power generation. They have plenty of roof space and the ones I've seen have plenty of land around them to put panel farms. They can have their own battery backups that store excess solar energy.

    The any energy they need above and beyond that they pay the same as residential customers with tiering. You use more - you pay more. That's how both my electric and water utilities work. I don't get a break. They shouldn't either.
  • The greatest obstacles to bring new sources of generation online over the last 10 years, have been Red State legislatures, who have made the Siting and Permitting process for new plants almost impossible to get signed off. Since almost all new generation projects are renewable in nature, they saw it as a way to engineer a crisis that made the EPA look bad, and keep old dirty plants running long after their lifespans had elapsed.
    • You're wrong. Which US state has the most renewable energy? Hint - it's not California.

      It's Texas.

      The republicans rage on renewable energy, because it plays well on Fox, Rogan and Alex Jones. But that's just a distraction. It's a magician thing. You gotta pay close attention to what BOTH HANDS are doing if you want to know what's actually going on. Republicans hate renewable energy, but red-state businessmen are quietly installing renewable power as fast as they can manage it. It makes the most profit
      • Look at the 13 states that PJM operates in. They've taken a very different tact. For instance making it easy for townships and counties to nix plans to build solar and wind installations. Ohio Senate Bill 52 (SB 52) of 2021 is a perfect example. basically no new renewable generation has passed siting approval since (though HB15 2025 seeks to remediate that a bit).

  • Paying for this is the least of the problems (Score:4, Insightful)

    by Arrogant-Bastard ( 141720 ) on Tuesday January 13, 2026 @05:03PM (#65922102)
    That's because it's not a science or engineering problem: it can be solved with the stroke of a pen. Yes, it's certainly contentious, but it's a problem with a well-known set of solutions and it's just a matter of working out which of those should be applied.

    The far more difficult problem set involves energy production, energy transmission, energy storage, energy use, water use, and pollution. And a sober evaluation of those in this context would lead any reasonable person to conclude that massive data center expansion is not a good idea, no matter who agrees to pay how much for it. The problem is: these people aren't reasonable. They want to keep chanting "AI! AI! AI!" like a mantra, keep claiming it'll fix everything from diabetes to highway congestion, and keep plowing ahead with these reckless plans no matter what the consequences are.

    And that will work out just fine for them because they won't be the ones bearing the consequences. We will.
  • datacenter power requests are pie-in-the-sky speculative and not to be taken seriously. Those numbers fall in the same category as OpenAIs stated valuation, which assumes that ChatGPT will make every worker on the planet 100 times more productive, all the profits will flow directly into Altman's pocket, and that nobody else is capable of launching a competing product. Or Facebook's valuation that assumes that every human on the planet will use Facebook for 35 hours per day.

    I'm gonna bet that the form fo

  • PJM commits to keeping existing residential and business grids stable, and not increase their prices.

    "Excess" users like AI data centers, crypto miners, etc. must bid once per day with a max price/kWh they're willing to pay. As long as there's no shortage, everyone pays normal rates, and it's fine. If they run out of capacity, then the excess users are shut off from lowest to highest.
    For example, five AI data centers bid 10, 20, 30, 40, and 50c/kWh today. If capacity is low, the 10c DC gets shut off, and th

  • Unless they're legally obliged to produce infinite power, declining business should not be a problem.

  • ... unless data centers bring their own power supply, "PJM will be in the position of allocating blackouts rather than ensuring reliability."

    If they could instead bring themselves to say "PJM will be in the position of disconnecting their power lines from data centers and applauding as they sit dark, cold, and silent", then everybody who actually matters would be safe and happy.

    (For the purposes of my argument, those who "actually matter" are people and organizations which aren't building pyramid / Ponzi schemes, or inflating tech bubbles, or gaming the system by externalizing their costs to average citizens. Large predatory corporations which

  • First google's AI is down, then microsoft's, then openAI or whatever they are called. Then repeat. Why should even one residential customer in the country ever be inconvenienced for this monumental waste of public resources?

    • >"First google's AI is down, then microsoft's, then openAI or whatever they are called. Then repeat. Why should even one residential customer in the country ever be inconvenienced for this monumental waste of public resources?"

      I was thinking the same thing. They mention the risk of blackouts. Well, fine. But the priority for power should go to medical and emergency sites, then schools and such, regular business/homes, and way down the line, data centers. If they are the cause of grids being overloade

  • Roll it to the data centers and nowhere else. They have dedicated lines, if they're built properly they have dedicated backup power generators, etc.

    Don't make some normal working stiff deal with warm beer because some rich twits have decided to use AI algorithm abc rather than a more modest algorithm built in a world with physical system constraints. These models do not have to be built with infinity resources. More efficient models will be made, and the sooner economic forces bring these advancements to

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