Dive Brief:
- Largely driven by data center growth, the PJM Interconnection expects its summer and winter peak load will grow by 2% and 3.2% a year on average through 2045, up from 1.6% and 1.8% growth, respectively, in last year’s forecast, according to a presentation on its preliminary load forecast that was discussed at a Load Analysis subcommittee meeting on Monday.
- PJM uses its annual load forecast for transmission planning and to help determine how much capacity it should buy in its capacity auctions. PJM’s next base capacity auction, for the 2026/27 delivery year, is set to be held in July.
- Meanwhile, it will be hard to build enough power and transmission infrastructure to meet anticipated data center growth in Virginia, the Virginia General Assembly’s Joint Legislative Audit and Review Commission said in a data center report released on Monday.
Dive Insight:
The increased preliminary load forecast is largely driven by “large load adjustments,” which mostly come as a result of newly planned data centers, Molly Mooney, PJM senior analyst for resource adequacy planning, said during the subcommittee meeting. The preliminary forecast includes about 50,000 MW in new large loads, which includes some industrial and port electrification load, by about 2032, according to the presentation.
PJM’s annual load forecast process allows utilities to propose load forecasts changes to reflect new anticipated loads in their service territories. PJM vets the requests before including them in its annual load forecasts, according to Mooney. This year has an unusually high amount of load adjustment requests, she said.
The preliminary forecast, for example, includes about 5,000 MW in new data center load for PPL Electric by 2031 as well as about 2,500 MW by 2032 for FirstEnergy’s American Transmission Service zone and 2,000 MW by 2033 for its Allegheny Power zone, according to the presentation.
The areas with the most expected average annual summer load growth over the next 20 years are the Virginia Electric and Power Co. zone with just over 5% forecast growth, followed by the PPL Electric zone with just over 4% expected growth and the American Electric Power zone with just under 4% expected growth, according to the preliminary forecast.
The preliminary forecast estimates PJM’s peak summer load would hit about 200,000 MW in the 2032/33 delivery year compared with about 170,000 MW in last year’s forecast, according to the presentation.
In a change from last year, PJM’s load forecast covers a 20-year horizon compared with 15 years in previous forecasts. The change reflects the Federal Energy Regulatory Commission’s new requirement that grid planners develop transmission plans that span at least 20 years, Mooney said.
PJM staff plans to review its preliminary load forecast with its Planning Committee at a Jan. 7 meeting and then review and finalize its data before issuing a final load forecast in mid-January, according to Mooney.
Hard to build power infrastructure for Virginia’s potential data centers
Meanwhile, Virginia’s Joint Legislative Audit and Review Commission said it would be difficult to meet the power-related needs of the state’s data center industry, partly due to permitting challenges in a densely populated region, according to its Dec. 9 report. The commission works at the direction of the Virginia General Assembly.
Northern Virginia — the largest data center hub in the world — has about 150 data centers with about 5,050 MW of load, according to the report. Data center growth could drive average monthly data center usage to about 30,000 GWh by 2040 under an “unconstrained” scenario from about 11,000 GWh this year.
Under Virginia’s clean energy law, meeting only half that demand growth by 2040 would require 19,000 MW of renewables, 9,900 MW of fossil-fueled generation, 2,700 MW of nuclear generation, 3,100 MW of storage and demand response and 3,100 MW of transmission capacity, according to the report. The region would also need new natural gas pipeline capacity to serve new power plants, the commission said.
“Transmission needs would remain substantial under the half of unconstrained demand scenarios, especially in and around the Northern Virginia region, and building enough transmission capacity within a 15-year timeframe could be even more difficult than building enough generation,” the commission said.
Under current rate practices, a buildout to meet data center demand could drive up generation- and transmission-related residential ratepayer costs by $14 to $37 a month depending on how much infrastructure is built, according to the report.
“One of the main risks posed by the data center industry’s rapid growth is that utilities will build more energy infrastructure than is needed if forecast demand does not materialize as expected, or one or more large data centers close,” the commission said.
To address concerns raised in the report, the commission said the General Assembly may want to clarify that utilities have the authority to delay service to customers when they cannot support new customer load with available transmission or power supplies.
In addition, lawmakers could consider requiring data centers to participate in utility demand response programs. They could also direct Dominion Energy to develop a plan for addressing the risk of infrastructure costs being stranded with the utility’s existing customers, and file that plan with the Virginia State Corporation Commission.
The General Assembly’s legislative session begins Jan. 8.
