A Tale of Two Eastern Grids: Inside PJM's 220-Gigawatt Overhaul
A Tale of Two Eastern Grids
Grid operator PJM has revised its interconnection process to improve certainty, speed, and discipline of project review.
Interconnection queues require proposed project to be studied at multiple levels to asses impacts of new projects on existing power flows, need for new transmission infrastructure, costs, and potential impact on neighboring systems.
PJM’s review process took as long as 5-7 years, and at one point the grid operator simply stopped taking new applicants.
A large part of the issue arose from the larger numbers of smaller solar, wind, and battery storage projects applying.
There was also a lot of speculation as developers put different projects in queues across the country; if one got approved, they’d pull the others.
As an side, the demand side for the data center interconnection queues is very similar, so you have huge amounts of phantom load inflating data load capacity numbers by an estimated 3 to 10X.
Back to the supply side: The old approach involved a first-come, first-served model, and didn’t require much proof of financial viability.
Now, PJM has a “first-ready, first-served approach,” prioritizing projects that are more advanced with a better chance of actually being commissioned.
Projects must also show proof of financial viability prior, including up-front financial commitments and a demonstration of project site control.
The deadline for new applications closed on 4/27, and PJM announced it had 220,000 MW (220 GW) of name plate capacity in new applications, representing 811 projects. Gas-fired gen led the mix, with 106 GW of nameplate capacity and 157 projects, followed by energy storage, with 66 GW offered by 349 projects. Perhaps surprisingly 27 nuclear projects were in the mix, with an associated 18 GW of capacity, followed by 15 GW of solar and 9 GW of solar storage hybrids, together totaling 187 projects. 65 wind projects also made the list, responsible for 4.7 GW of capacity.
PJM must now validate the applications, and it will deploy Google subsidiary Tapestry’s “HyperQ” AI-enabled software to improve efficiencies by reviewing data associated the interconnection process, while expediting the study process.
Not all of the approve projects will come online anytime soon. For example, Commonwealth Fusion is in the queue and it doesn’t even have a working demo fusion reactor yet.
And the gas projects may find turbines unavailable as suppliers are largely sold out through the end of the decade. PJM also notes that state permitting processes slow things down.
PJM wants to get much needed supply online, citing an expected increase in demand of 30 GW between 2024 and 2030, driven largely by data center loads. So, they are planning on a one- to two-year review process, depending on individual project impact.
Meanwhile, looking further northeast, ISO-NE is also eyeing changing demand, but it is forecasting a reduction from previous numbers. It doesn’t expect much data load, with demand anticipated instead from EV sales and heat pump deployments – both of which have recently slowed. The grid operator has cut its forecast a couple times, from 17% over ten years in 2024 to 9% over ten years in its most recent 2026 outlook.
The region’s net annual energy use has actually trended downward over the past 20 years, owing to more efficient technologies and the growth of on-site solar power.
This stuff is heard to get right in a world in which everything is constantly in flux. Let’s take the Strait of Hormuz. If it stays blocked for another two months, an enormous economic petroleum energy shock could occur. Then, EV sales could boom again and anybody using oil heat in New England will race for heat pumps. In this world, it seems we – and grid planners - can count on little else besides the accelerating pace of change.