Data centers may face temporary power outages to prevent power outages across US’s largest grid

The largest electric grid in the US has struggled to cope with the onslaught of data centers. Now, after an auction to add more generating capacity failed, the grid operator, PJM Interconnection, said it would shut down data centers and other large users during power shortages.

The decision comes at a time when the frenetic pace of data center construction is leaving grid operators struggling to generate electricity. By 2035, data centers are expected to use 4 times more electricity than today.

PJM will not begin cutting supplies until June 2027, and the cuts will only apply to data centers of 50 megawatts or more. The network operator is holding another auction for new generating capacities.

Like other demand response programs that have been around for decades and typically involve large users such as manufacturers, customers whose power is out will receive compensation. Such programs typically give customers anywhere from 30 minutes to several days’ advance notice, depending on projected demand.

The move is likely to push many new data centers — and potentially existing ones — to build their own on-site power sources. Those that don’t are likely to rely on backup generators, which tend to be more expensive to run and often more polluting.

Many data centers advantage of diesel generators since fuel is widely available and can be stored on site. Federal regulations allow such generators to be used up to 50 hours per year for demand response and up to 100 hours per year for events such as emergencies and maintenance.

Vantage data centers have come under fire for this this week apparent coordination with Virginia environmental regulators to question a report that says diesel backup generators may contribute tens of millions of dollars annual damage to the health of people living near a 96 megawatt data center in Northern Virginia.

PJM has come under fire in recent months for the way it has managed new generation capacity and large new users, including data centers. The network operator’s territory runs from Virginia to Illinois, covering 67 million customers. Over the past year, wholesale electricity prices have risen almost twiceand independent market monitor PJM blamed data centers for much of the increase.