
Dominion Energy Virginia, American Electric Power and FirstEnergy Corp. have entered into a joint planning agreement to propose several new regional electric transmission projects across multiple states within the PJM footprint.
The utilities noted that the collaboration comes at a time when efficient and cost-effective regional transmission development is encouraged by the Federal Energy Regulatory Commission (FERC).
Power demand in the PJM region is growing at an “unprecedented pace” due to rapid expansion of energy-intensive industries such as data centers, the electrification of transportation and heating, and increased manufacturing onshoring, the utilities said. At the same time, the region’s power generation mix is changing as legacy generation is retired and more renewables are added to the grid.
The companies jointly proposed the projects through PJM’s Regional Transmission Expansion Plan (RTEP) Open Window process in September. The proposed projects include several new 765-kV, 500-kV and 345-kV transmission lines in Virginia, Ohio and West Virginia.
The projects remain in the early stages of development. If selected by PJM, the companies would then undertake an extensive, multi-year process to select routes, perform environmental studies, engage with communities, obtain state and local permitting and build the projects.
In addition to the joint proposals, each of the three companies have also submitted individual proposals for other transmission projects consistent with how each company has participated in past PJM open windows.
“This dynamic environment requires more regional collaboration to develop large-scale ‘backbone’ transmission infrastructure that spans across the areas served by our three companies,” said Ed Baine, President of Dominion Energy Virginia. “By leveraging the expertise and resources of three industry leaders whose transmission zones border one another, we’re better able to develop superior and more cost-effective solutions required to effectively resolve reliability issues across the PJM region. These projects are more comprehensive and will be more effective than what each of our companies would be able to develop individually.”
According to the International Energy Agency (IEA), electricity consumption from data centers, artificial intelligence (AI) and the cryptocurrency sector could double by 2026. Data centers project to be significant drivers of growth in electricity demand in many regions. In the U.S. alone, data center demand is expected to reach 35 GW by 2030, up from 17 GW in 2022, McKinsey & Company projects.
“AEP operates the largest transmission network in the nation and has more experience building 765 kV infrastructure than any other company in the U.S.,” said Bob Bradish, senior vice president, Regulated Infrastructure Investment Planning for AEP. “The solutions we have proposed to address the rapidly evolving energy demand we are seeing across the region will enable us to continue providing reliable service and drive economic growth.”
PJM’s recent power market auction was a canary in the coal mine. The July 30 auction produced a price of $269.92/MW-day for most of the PJM footprint, compared to $28.92/MW-day for the 2024/2025 auction- a nearly 900% increase. Prices soared even higher in the Baltimore Gas & Electric zone in Maryland and the Dominion zone in Virginia and North Carolina due to insufficient resources inside those regions and constraints on the transmission system that limit the ability to import capacity. Those regions saw prices reach $466.35/MW-day (BGE) and $444.26/MW-day (Dominion).
The total capacity bill for the region increased from $2.4 billion to about $14.7 billion, and some of that difference will be passed on to PJM’s customers starting in mid-2025. Next June, Maryland ratepayers could see their electricity bill increase by as much as 29%, according to Tom Rutigliano, senior advocate with the Sustainable FERC Project at the Natural Resources Defense Council.
According to numerous industry experts, the PJM price hikes are driven by the cumulative effect of years of struggling to get more renewable generation interconnected. At the end of 2023, PJM had 3,309 projects – mostly solar and battery storage – waiting to connect to the grid.