For the first time in four years, the organization that manages the wholesale electricity supply for Pennsylvania and a dozen other states is reviewing applications to build and connect new sources of power to the grid. 

The announcement by PJM Interconnection last week comes as elected leaders  across the country are focusing on “the affordability problem,” as rising demand – largely driven by data center development – butts up against a dearth of new supply, driving up electricity bills.

PJM, based in Montgomery County outside Philadelphia, touts more than 800 proposed projects ranging from natural gas-fired thermal power plants to renewables like wind, solar and battery storage. And for the first time, a company planning to build a fusion power plant in Virginia is seeking approval to join the grid. 

The projects are the first since 2022, when PJM paused its review process as it scrambled to keep up with applications. The new batch will move forward under “a redesigned approach focused on improving the certainty, speed and discipline of project review,” PJM said in a news release Wednesday.

While electricity market watchers say PJM restarting its queue is good news for the industry and consumers, some note it comes at the cost of fewer sustainable energy sources in the mix. 

“We’ve seen carnage with projects that we put on hold for so long that they‘re very hard to get started again,” Abe Silverman, a researcher at Johns Hopkins University’s Ralph O’Connor Sustainable Energy Institute, said.

But Todd Snitchler, president and CEO of the Electric Power Supply Association, said the response from investors and developers to the restart shows PJM’s reforms sent the right signals to restore confidence in the process. 

“That bodes well for the future of the market, which ultimately is good for consumers,” Snitchler said.

The reformed process replaces PJM’s first-come, first-served method with a first-ready, first-served approach to prioritize projects that are closer to actually starting construction. That includes showing proof of meaningful financial commitments and control of the proposed site. 

“These requirements are designed to reduce speculative projects, improve predictability and increase the overall pace of interconnection,” the organization said in a release.

Natural gas power plants make up the largest category of projects by generating capacity, with 157 applications totaling nearly 106 gigawatts of electricity. That’s followed by 349 storage projects, totaling about 67 gigawatts; and 27 nuclear projects totaling 18 gigawatts.

The remaining proposals are solar, solar with storage, wind, hydroelectric and other sources including coal, methane, biomass and fusion for a total of 220 gigawatts.

That’s more than the 180 gigawatts of generating capacity that PJM currently oversees and not all of the projects will be built.

Details will remain confidential until the applications are formally accepted.

“We are encouraged by the diversity of generation types that are seeking to join the PJM generation fleet,” said David Mills, who became the organization’s president and CEO on Friday after serving since January in an interim capacity.

“That includes first-time innovative technologies such as small nuclear reactors and fusion, more storage projects than any other technology, a resurgence in natural gas and continued strong participation by renewables and hybrids,” Mills said. “This is good news because we need all the generation we can get.”

PJM forecasts electricity use will grow by nearly 70% over the next two decades. Most of the new demand will come from data centers to develop artificial intelligence, an endeavor some elected leaders liken to a new race for global technological dominance. On the national level, states are competing to attract data center projects for the boost they’re expected to bring to local economies.

But state and national leaders are also focused on the impact the additional generation could have on consumers and transmission costs that could come with massive data centers, which can consume as much power as a small city. In January, the governors of the PJM states and the Trump administration agreed on a set of principles to guide reform of the electricity market.

They included a two-year extension of the price collar established in January 2025 by a settlement between PJM and the Shapiro administration. The agreement capped bids to provide capacity to meet peak demands at $325 per megawatt day. It followed a capacity auction in July 2024 that set a new record price of $270 per megawatt day.

The Federal Energy Regulatory Commission, which oversees regional transmission organizations including PJM, approved the extension Thursday. It will apply to two auctions this year to secure resources for 2028 through the 2029-2030 delivery year.

In its announcement, PJM noted that although it was not accepting new applications while its interconnection queue was paused, it was still approving requests to connect made before 2022.

Since 2020, PJM completed agreements for 103 gigawatts of capacity to connect to the grid; of those projects, only 23 gigawatts went into service. Another 54 gigawatts cleared PJM’s process but have not started construction, with developers saying permit issues are the biggest hold up.

“As the numbers document, PJM’s interconnection process is not standing in the way of generation development, and the focus should be on clearing real hurdles to construction, as some states have done with permitting timelines,” PJM’s Vice President of Planning Jason Connell wrote on the organization’s website. 

But among the projects in the queue before the pause, 74% have withdrawn their applications, according to Connell’s article.

Jon Gordon, senior director at Advanced Energy United, a renewable energy industry group, said for many of those developers the wait was simply too long.

“Companies might have gone out of business waiting. And then the whole world changed, the inflation, supply chains, COVID, you know? So PJM likes to declare victory, like they clear out the whole backlog where 74% of people just walked away,” he said.

Silverman, the Johns Hopkins researcher, said PJM saw huge interest from renewable energy developers between 2018 and 2022, which overwhelmed its approval process, which was designed for large coal and gas plants, not hundreds of smaller power sources known as distributed energy resources.

Because the process worked on a first-come, first-served basis, a change in the parameters of a project could affect the conditions affecting the projects behind it. 

“PJM kind of got itself into an infinite loop,” Silverman said. “If project three had an unfavorable cost allocation … projects four through 400 would need to be restudied.”

In the new queue, projects will be studied in clusters, which Silverman said is a huge improvement. Instead of reviewing projects one at a time, multiple projects will be considered for addition to the grid and the reviewers will look for overlapping impacts of one project on another.

Snitchler, of the Electric Power Supply Association, said the mix of energy sources among the 811 projects now in the queue indicates market participants see a need for dispatchable power – meaning power that can be delivered on-demand as opposed to wind, solar or hydroelectric, which rely on nature.

“If you’re a data center that is looking for the five nines reliability, dispatchable resources are the technology that you need,” Snitchler said. “And in the shorter term … natural gas is going to be the technology that likely fits most of that bill.”