The PJM Interconnection, the largest electricity grid in the United States, stands on the brink of a significant transformation, driven by the explosive growth of data centers necessary for artificial intelligence operations. As these centers proliferate, the anticipated surge in power consumption is staggering. By 2035, peak summer demand in the PJM region is projected to rise by 58 gigawatts, bringing the total to an unprecedented 210 gigawatts. This increase is akin to adding two entire New England electricity networks to the grid, a feat that raises serious questions about the resilience and capacity of our existing electric infrastructure.
The implications of this surge extend far beyond mere numbers. As data centers consume energy at scales comparable to entire cities, the strain on the current grid could lead to reliability challenges and increased risks of outages. The urgency of addressing these challenges was underscored by President Donald Trump during the World Economic Forum in Davos in January 2025. He called for the construction of new power plants in tandem with data centers to alleviate grid stress, emphasizing the need to circumvent the delays and reliability issues that plague the existing infrastructure.
Yet, the landscape of energy production is shifting dramatically. In a move that could redefine the future of energy policy, President Trump issued an executive order suspending funding under the Inflation Reduction Act (IRA), a decision that has raised eyebrows across the clean energy sector. This order, dubbed “Terminating the Green New Deal,” halts funding for crucial initiatives under the Infrastructure Investment and Jobs Act, particularly those aimed at discouraging fossil fuel development. The White House has clarified that the IRA pause primarily impacts programs promoting electric vehicles and renewable energy, raising concerns about the long-term viability of clean energy projects.
In response to this evolving energy landscape, NextEra Energy has formed a partnership with GE Vernova to develop natural gas-fired power generation projects. This collaboration aims to meet the burgeoning electricity demand from AI data centers and other significant power consumers across the U.S. The choice to pivot towards natural gas reflects the growing uncertainty surrounding federal support for renewable energy initiatives under the new administration. By 2029, NextEra and GE Vernova plan to initiate power generation projects that combine natural gas facilities with renewable energy sources, such as solar and battery storage. This hybrid approach underscores a pragmatic response to the immediate energy demands while still acknowledging the potential for a more sustainable future.
As the PJM region grapples with the impending energy crisis, the intersection of AI, data center growth, and energy policy will shape the contours of the energy sector for years to come. The decisions made today—regarding infrastructure investment, energy sourcing, and regulatory support—will have lasting ramifications. The challenge lies not only in meeting the immediate power needs but also in ensuring that the solutions implemented today do not compromise the long-term sustainability of our energy landscape. The dialogue surrounding these issues is critical, and as stakeholders navigate these complex waters, the choices made will reverberate throughout the economy and society at large.
