Pennsylvania Threatens to Go ‘Own Way’ If Grid Won’t Change

Pennsylvania Governor Josh Shapiro said his state would leave America’s biggest power grid if its operator won’t make changes to rein in surging energy bills.

“If PJM is not willing to look in the mirror and really reform itself, then I’m willing to go my own way and Pennsylvania can stand alone in this effort,” Shapiro said Monday on Bloomberg Television, referring to grid operator PJM Interconnection LLC. “We can produce enough energy for us, and we can produce enough energy at a far quicker rate than PJM is able to right now.'

Bloomberg's Tyler Kendall spoke to the Pennsylvania Governor as he stated his state is prepared to leave America’s biggest power grid if its operator won’t make changes to rein in surging energy bills.

On Monday, Shapiro convened a summit at the National Constitution Center in Philadelphia after the cost of securing wholesale power supplies on the grid set a record for two straight years. It was the first meeting of its kind led by states. Shapiro, a Democrat, is pushing for PJM to make states an active part of the decision–making process while also increasing transparency and accountability.

“Meeting the demands of a rapidly changing energy landscape will require solutions that extend beyond any one institution,” PJM said in an emailed statement Monday. “It will require PJM, the industry and especially our states all working in concert.”

Even before the AI-power boom, electric costs were already rising to help rebuild aging grid infrastructure, fortify it against extreme weather, adjust to the rise of residential solar and meet increasing demand from electric vehicles. Now, data centers are adding further strain, with new facilities needing as much electricity as towns or even cities. And there are other factors affecting prices, including supply chain constraints and tariffs.

Shapiro also took a swipe at President Donald Trump, saying his moves to slow clean energy is making it harder for Pennsylvania to produce enough power.

“I’m an ‘all-of-the-above’ energy governor, I wish the president was an ‘all-of-the-above’ president,” Shapiro said, using a term that indicates support for both fossil fuels like natural gas as well as clean energy like wind and solar.

The White House didn’t immediately respond to a request comment.

The grid operated by PJM, stretching from Virginia to Illinois, has become a bellwether for the ways that soaring demand for electricity has transformed power markets in the US and around the globe. As home to the world’s biggest concentration of artificial intelligence data centers, the region is set to see power demand skyrocket, and costs are already starting to.

After PJM’s annual power sale yielded a record cost to secure supplies last year, Shapiro filed a lawsuit against federal regulators that resulted in a settlement that set a price cap on future auctions. But even with the cap in place this year, the price of power supply hit another record: $16.1 billion.

Joe Bowring, president of Monitoring Analytics, PJM’s independent watchdog, said on a panel at the summit that the question is how to draw the power supplies needed to serve data centers.

Simply “letting the market work will mean blackouts,” he said.

While this isn’t the first time states or utilities have threatened to pull out of PJM, this latest threat carries greater urgency with the grid now at an “inflection point,” according to several panelists Monday. There was widespread frustration expressed at the conference — from policymakers and regulators to developers — that the status quo won’t build a grid of the future fast enough.

Earlier this year, New Jersey lawmakers passed legislation to consider leaving the PJM grid. Maryland state lawmaker Lorig Charkoudian said in an interview Monday said she would consider advocating to do the same in her state. It may make sense for the founding states of the grid — Maryland, Pennsylvania and New Jersey — to carve out a separate system, potentially with Delaware, she said.

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