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Pennsylvania's power grid is under pressure as a surge in data center development drives up electricity demand. According to a 2024 report by the Electric Power Research Institute (EPRI), data centers are expected to consume 9% of the U.S. power supply by 2030, more than doubling their current share. This rapid growth, driven by the rise of artificial intelligence and cloud computing, is testing the state's grid reliability.
The report, authored by Synapse Energy Economics for the Pennsylvania Public Utility Commission, highlights the potential for increased power outages. In the "most likely" scenario, power generation shortages could lead to outages affecting 4.2 million households across the PJM Interconnection's 13-state territory, including Pennsylvania. These outages could occur about six times over the next decade, averaging 47 minutes each.
Pennsylvania is witnessing its first wave of major data center projects, with 55 projects in preliminary discussions and 16 having filed permit applications. The influx of data centers has sparked local opposition due to concerns about energy supply and pricing. PJM's planning standards aim to limit supply-related outages to one per decade, but the report suggests that without policy changes, outages could become more frequent.
The report also indicates that Pennsylvania's share of energy generation within the PJM service area could fall from 23% to 16% over the next 15 years, primarily due to the retirement of coal- and natural gas-fired power plants. Senate Majority Leader Joe Pittman criticized former Governor Tom Wolf's efforts to join the Regional Greenhouse Gas Initiative, which he claims hindered energy development in the state.
Governor Josh Shapiro, who initially supported data center projects, has since ended "fast track" permitting and imposed stricter development standards. The combination of data center growth, electric vehicle market expansion, and on-shoring of manufacturing is already impacting energy prices for Pennsylvanians.
The Synapse report urges urgent action to address the imbalance between electricity demand and supply. Public Utility Commission Chair Steve DeFrank stated, "Electricity demand and supply are moving out of balance, and the status quo is not sustainable." The report calls for a comprehensive Pennsylvania energy strategy to ensure the state's electricity supply keeps pace with demand.