The PJM Interconnection, the nation’s largest grid operator, released a forecast this week that found at least five gigawatts of load flexibility will be needed by 2030 to avoid outages.
The actual number could be even higher, according to Duke University researcher Tyler Norris, since the scenario assumes that the grid operator will connect 25% more new generating sources that PJM has historically managed to bring online. And even then, electricity demand outstrips supply so much that there’s no reserve margin to make up for unplanned outages.
“Five GW appears to be a fairly conservative estimate,” Norris told Latitude Media in an email.
In February, Norris released a landmark study detailing how designing data centers to modestly cut back on electricity usage when the grid is in trouble can make space for almost 100 GW of additional load growth — without building a bunch of gas-fired power plants.
In the wake of the report, load flexibility has been having a moment. Goldman Sachs praised the concept of data center flexibility in a report, and Google expanded its own demand response work to target machine learning workloads, brokering two new utility agreements.
However, PJM’s own attempt to enact new rules to support flexibility have drawn fierce blowback. In August, the grid operator put out a conceptual proposal in August for a plan that would ask large electricity users such as data centers to voluntarily reduce their power consumption when there’s a shortage of electrons on the wires — and potentially require them to do so if too few step up.
For more on PJM and the capacity crunch, listen to Steve Piper, research director of North American power and renewables at S&P Global, on a recent episode of the Catalyst podcast:
The proposal largely aligned with what the Data Center Coalition, a trade association, recently backed in a North Carolina regulatory filing. But in comments submitted about the proposal, companies such as Microsoft, Amazon, the independent power producer Talen Energy, and the Data Center Coalition itself criticized the proposal.
As former Federal Energy Regulatory Commission commissioner Allison Clements explained on a recent Latitude Dispatch about PJM, the proposal is a reflection of the grid operator “trying to figure out a way to decrease the capacity obligations of new large loads,” which “conceptually is a good thing.”
However, Clements added, this is essentially a stop-gap measure for a grid plagued by bottlenecks and delays. The proposal, she said, “is an uncertain, temporary administrative process to ensure that the lights don’t go out. It’s not ideal from an efficiency or an economic perspective.”
Norris agreed, and especially emphasized that the industry is still in early stages of embracing the concept. “We’re not going to turn the whole industry on a dime,” Norris told the audience of his own Latitude Dispatch earlier this month. “It’s going to take a few years for all this to play out, but I think it’s very exciting to see these different, creative approaches now being seriously explored.”
