PJM capacity auction clears at $16.4 billion as data center demand outruns supply

PJM Interconnection’s latest capacity auction cleared at $16.4 billion for the 2028/2029 delivery year, the grid operator said July 14, as data center demand again outran new power supply.

The auction procured 149,182 megawatts of capacity to serve about 67 million people across 13 states and Washington, D.C. The clearing price hit the federally approved cap of $325 per megawatt-day across the entire PJM footprint, a 2.5% dip from the prior cap of $333.44. Without that ceiling, the auction would have cost far more, clearing closer to $30 billion at an uncapped price of roughly $555 per megawatt-day.

Data center load accounted for roughly $6.3 billion, close to 40% of the total by outside estimates. That concentration is the story: procured supply fell short of PJM’s reliability requirement by 6,831 megawatts for the third straight auction, and only about 525 megawatts of new generation cleared.

PJM’s own release ties the strain to the continued addition of large data center loads to the load forecast that sets its reliability requirement, even as new supply barely moved.

The price cap masks the underlying shortfall rather than resolving it, since the auction cleared at the ceiling regardless of how tight supply ran. PJM must submit an emergency procurement proposal to federal regulators before month-end to meet a September implementation deadline.