Natural Gas Dominates PJM’s First Reformed Grid Queue, Driven by Data-Center Demand -
Natural gas projects have surged to the top in PJM Interconnection's first round of its reformed grid queue, making up nearly half of the more than 200 gigawatts qualified for study. This shift is primarily driven by an expected 70-gigawatt increase in demand by 2038, largely from data centers. PJM's new "first-ready, first-served" system aims to streamline the process by requiring developers to prove project viability upfront.
PJM Interconnection, the nation's largest grid operator, has seen natural gas projects dominate the initial phase of its revamped interconnection queue, representing almost 100 gigawatts across 147 projects. This marks a significant departure from three years prior, when the queue was predominantly composed of renewable energy sources. The driving force behind this shift is a projected surge in electricity demand, estimated to increase by up to 70 gigawatts by 2038, largely due to the expansion of data centers within PJM's operational territory, which covers 13 states and the District of Columbia.
The new "first-ready, first-served" system, introduced to address a large backlog of speculative proposals, now mandates developers to provide financial commitments and demonstrate site control before their projects are evaluated. This reform was necessitated by years of delays that led to the withdrawal of numerous clean energy projects, which previously constituted over 90% of the queue, due to extended waits, supply chain disruptions, and economic changes. According to Abe Silverman of Johns Hopkins University, this indicates a "gold rush" for natural gas to satisfy the growing data center electricity needs.
While natural gas leads in total capacity, battery storage and solar projects combined account for a greater number of individual proposals, signaling ongoing resilience in clean energy development. PJM officials, including Vice President of Planning Jason Connell, express optimism regarding the caliber and volume of applications, anticipating that the new regulations will effectively filter out non-viable projects. Nevertheless, PJM acknowledges that external factors such as state permitting, local opposition, supply chain issues, and financing remain potential obstacles for project completion.