PJM Approves Over 50 GW of Clean Power, Faces Build-Out
PJM Interconnection has approved over 50 gigawatts of clean energy projects for grid connection, but state-level delays in grid upgrades and permitting
The country's largest grid operator, PJM Interconnection, has finally approved interconnection rights for more than 50 gigawatts of new power projects. These projects, primarily solar, wind, and battery storage, are now the only generation options that could be deployed fast enough to impact the grid before 2030, according to energy analysis nonprofit GridLab.
PJM serves 67 million customers across 13 states. Its capacity market prices have spiked more than eightfold in recent years, reaching a record $16.4 billion in its past two auctions. This surge is driving up utility bills. The grid operator's interconnection queue has been notoriously slow, with some projects waiting for approval since 2018.
The Approved Clean Energy Pipeline
Although natural gas plants dominate new applications, the vast majority of projects with final interconnection approvals are clean energy. Data from think tank RMI shows these projects could significantly reduce costs. A May report from Aurora Energy Research, commissioned by RMI, found that adding specific amounts of solar and wind by 2028 could yield substantial savings.
| Resource | Planned Capacity by 2028 | Potential Customer Savings (Over a Decade) |
|---|---|---|
| Solar | 5 GW | $10.9 billion combined |
| Wind | 5 GW | $10.9 billion combined |
An interconnection agreement, however, is no guarantee of construction. According to 2025 data from Lawrence Berkeley National Laboratory, 41% of U.S. Projects that signed interconnection agreements from 2000 to 2022 eventually withdrew.
The Utility Upgrade Bottleneck
Once PJM issues an interconnection agreement, the project moves to the next phase: paying for required grid upgrades. PJM spokesperson Jeff Shields stated that after issuing agreements, projects "are done with our process and are free to connect." He added, "We would love to see all those projects get built, but we don't have the authority to make it happen."
The responsibility for building necessary infrastructure falls to utilities. They must construct local "spur lines," substations, and often make deeper high-voltage transmission investments. David Mindham, senior director at developer EDP Renewables North America, says utilities often want several years to complete these network upgrades.
An analysis by startup Halcyon found that interconnection upgrades by utilities in PJM were far more likely to be delayed than other grid projects. Energy researcher Abraham Silverman, who co-authored a 2024 report on PJM's challenges, explained a potential reason. He said utilities "don't prioritize network upgrades because they don't get to roll them into rates." Utilities earn regulated profits on capital investments and may prioritize projects that maximize those profits.
State Action and Permitting Challenges
State policymakers hold the key to accelerating construction. Nikhil Kumar, a program director for GridLab, argues that state governors must force utilities to act. "The only way you change this scenario is to have the governors tell the utilities to get these solar and battery projects online," Kumar said. He advocates for penalties or strict deadlines for meeting milestones.
A 2025 analysis from RMI and the National Caucus of Environmental Legislators proposed policy interventions like requiring utilities to share data on upgrade timelines and holding regulatory hearings for delays.
States also control the permitting process, which includes environmental reviews, siting, and zoning. This is a complex area facing rising local opposition in rural areas. While states like Illinois and Virginia are pushing pro-clean energy permitting policies, progress is slow. John Miller, an analyst at TD Cowen, noted, "States have made a lot of noise about improving state and local permitting, but we are still waiting to see the output." Conversely, states like Ohio are making it harder for clean energy projects to get permitted.
The years-long interconnection wait has itself caused problems. Silverman's report found many developers "effectively suspended all permitting and siting work" while waiting in the queue, during which time pandemic impacts and inflation radically changed project economics.
Data Centers as a Potential Catalyst
The surge in power demand from data centers is a primary driver of PJM's capacity crisis. Consumer advocates and state lawmakers blame proposed data centers for capacity price spikes. One proposed solution is to force new data centers to either pay for their own capacity resources or face disconnection during grid emergencies.
A July proposal from PJM would let utilities and state regulators implement such a policy, with states like Pennsylvania already moving in this direction. This could create a powerful new tool. If data centers sign contracts for new generation, it could unlock financing for the approved projects.
Glen Thomas, president of the PJM Power Providers Group, said, "If the new hyperscalers can sign contracts for new generation, a lot of the pieces will fall into place." Silverman also observes increased interest in resolving siting and permitting issues, particularly with data center developers willing to spend heavily to secure power.
