Electricity prices in the PJM Interconnection, the largest power grid in the US, have nearly doubled in a year. According to a report published by the independent monitor Monitoring Analytics, the wholesale price per megawatt-hour has risen from $77.78 last year to $136.53. This is reported by Techcrunch.com reporting states.
Experts attribute the price hike to the excessive electricity consumption by data centers and the PJM operator's inability to manage this growing demand. Monitoring Analytics emphasized that the financial shock to customers is irreversible and the situation will worsen if the problem is not addressed in time.
The PJM grid covers Northern Virginia, an area with a high concentration of data centers. With the development of AI technologies, the demand for electricity has surged, but existing power grids were not designed for such loads. In 2022, PJM halted the processing of applications for new energy source connections, which further deepened the current shortage.
The Monitoring Analytics report criticized PJM for a lack of transparency in its decision-making process and for delaying software updates for several years. The organization believes PJM is using the current crisis as a pretext to change market rules, while the root of the problem lies in the uncontrolled load from data centers.
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