A massive wave of AI-driven data center development, championed by President Trump and industry leaders, is intensifying concerns about the resilience of the U.S. power grid—especially across PJM Interconnection, the nation’s largest grid operator. At the center of the issue is PJM’s ability to manage soaring electricity demand from new data centers while transitioning to clean energy. Spanning 13 states from Illinois to Virginia, PJM oversees the grid that powers major data center hubs, but its aging infrastructure and bureaucratic approval processes are drawing sharp criticism from both political leaders and industry experts.
Last week, the governors of nine states within PJM’s jurisdiction issued a rare joint rebuke, citing a "crisis of confidence" in PJM’s ability to manage reliability and affordability. Their warning follows years of grid instability, including near-blackout events during recent peak demand periods. PJM blames “unprecedented” demand surges driven by data centers, with additional pressure from electric vehicles and electrified building systems. The Federal Energy Regulatory Commission (FERC) has also voiced alarm, stating that grid systems like PJM’s came dangerously close to failure during recent heatwaves.
The crisis isn’t just one of demand—it’s also about stagnation in power generation. PJM’s interconnection backlog has ballooned to over 2,000 projects, with approval processes lasting up to seven years and many approved projects failing to break ground. The majority of new generation proposals involve renewables—wind, solar, and battery storage—which are harder to integrate due to their intermittent output and nontraditional grid behavior. PJM’s planning systems, designed around fossil fuels, have struggled to adapt, further exacerbating reliability risks.
Experts agree the current approach to resource adequacy is outdated. The Department of Energy has called for sweeping reforms to how PJM and other regional transmission organizations plan, model reliability, and approve new power generation. Some critics, like those from the Rocky Mountain Institute and former PJM insiders, argue that PJM’s incremental reforms fall far short of what’s needed to meet the demands of a modern, AI-powered economy.
Meanwhile, pressure is mounting on FERC to step in and force comprehensive reforms. But the federal commission itself faces a period of transition, with its chair set to step down and a Trump-appointed successor waiting in the wings—raising fears of regulatory paralysis at a time when urgent action is needed. Without rapid structural change, experts warn that the U.S. may face increasing grid instability, higher energy costs, and an energy system unable to keep pace with data center-driven demand.
Ultimately, the collision of explosive AI growth, aging infrastructure, and policy inertia is testing the limits of America’s energy grid. Whether PJM, FERC, and the broader power sector can respond in time may determine if the future of digital infrastructure can be built without triggering widespread blackouts.
