PJM Orders Power Cuts for Contract Customers as Virginia Prices Top $2,000 per MWh
Updated
Updated · CNBC · Jul 3
PJM Orders Power Cuts for Contract Customers as Virginia Prices Top $2,000 per MWh
3 articles · Updated · CNBC · Jul 3
Summary
PJM told utilities to cut electricity to customers with emergency demand-reduction contracts after coming under a federal alert aimed at preventing blackouts across its 13-state grid.
Generator outages, overloaded transmission lines and prolonged heat-driven air-conditioning demand pushed the operator to escalate emergency actions for the system serving 67 million people.
Northern Virginia spot wholesale power prices climbed above $2,000 per megawatt hour this week, versus about $40 in normal conditions, as congestion made it far costlier to move electricity.
The move follows a U.S. Energy Department emergency order letting PJM require data centers and other large users to switch to backup power, highlighting how heat and fast-growing AI demand are stressing the grid.
Who should bear the trillion-dollar cost of upgrading the nation's power grid to fuel the AI revolution?
As AI booms, must communities choose between reliable electricity and clean air, or can technology offer a way out of this dilemma?
Beyond the power grid, what are the hidden water and land costs of our insatiable demand for artificial intelligence?
Record Electricity Demand in PJM: AI Data Centers Trigger DOE Emergency Orders and Grid Crisis (2026)
Overview
In July 2026, the PJM Interconnection region faced a severe energy crisis triggered by an intense heat wave and a record surge in electricity demand. To prevent blackouts, PJM quickly recalled maintenance outages to bring all available power plants online and issued alerts to prepare for emergency demand response. As the crisis escalated, the Department of Energy granted PJM special authority to tap into backup power from large users like AI data centers, marking a new approach to grid management. This situation highlights the growing challenge of balancing rapid demand growth from data centers with the need to maintain reliable and affordable electricity for everyone.