PJM’s Speed to Power Problem and How to Fix It

PJM is facing a capacity crisis driven by surging demand from data centers and a slow interconnection process that takes over eight years to bring new generation online. This delay has caused capacity market prices to skyrocket, with the total capacity bill rising from $2.2 billion in December 2022 to $16.1 billion in the latest auction. The author identifies long study timelines and high transmission network upgrade costs as primary barriers, noting that PJM has connected fewer new resources relative to peak demand than ERCOT or CAISO. To fix this, the document recommends implementing third-party automation software, reforming Energy Resource Interconnection Service (ERIS) to be a faster pathway, integrating advanced transmission technologies (ATTs), and prioritizing proactive regional transmission planning.

• PJM's interconnection process is significantly delayed, with the time from application to commercial operation increasing from under two years in 2008 to over eight years in 2025.
• The slow interconnection process has led to a surge in capacity market clearing prices, with the total capacity bill for ratepayers increasing from $2.2 billion in December 2022 to $16.1 billion in the most recent auction.
• PJM has added less new capacity relative to its peak demand over the last five years compared to the California (CAISO) and Texas (ERCOT) grid operators.
• The Transition Cycle 1 (TC1) study process demonstrated significant project attrition, with only 17 GW receiving draft interconnection agreements out of over 100 GW that originally applied.
• PJM's interconnection study cycle is too slow to meet efficiency goals; the TC1 process suggests a timeline of 1.75 years, exceeding the one-year target identified by grid experts.
• High network upgrade costs are driving projects out of the queue, as these costs often exceed benchmarks set by the Department of Energy and NREL.
• Advanced transmission technologies (ATTs) could more cost-effectively interconnect 6 GW of new resources, yet evidence suggests they were not utilized in TC1 interconnection agreements.

APA

RMI (2025). PJM’s Speed to Power Problem and How to Fix It. https://rmi.org/resources/pjms-speed-to-power-problem-and-how-to-fix-it/

Chicago

RMI. PJM’s Speed to Power Problem and How to Fix It. 2025. https://rmi.org/resources/pjms-speed-to-power-problem-and-how-to-fix-it/.

Wikipedia

{{cite report |author=RMI |title=PJM’s Speed to Power Problem and How to Fix It |date=4 November 2025 |url=https://rmi.org/resources/pjms-speed-to-power-problem-and-how-to-fix-it/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2025pjms, author = {{RMI}}, title = {{PJM’s Speed to Power Problem and How to Fix It}}, institution = {RMI}, year = {2025}, month = nov, url = {https://rmi.org/resources/pjms-speed-to-power-problem-and-how-to-fix-it/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }