These rules will safeguard grid reliability and protect consumers in the mid-Atlantic territory, which serves over 67 million Americans in 13 states and D.C.
As technology leaps forward, clear and fair regulations must keep pace to support advancement, help prevent price volatility, and promote competition, ultimately benefiting consumers by keeping electricity costs manageable, FERC said.
“Today’s order is a monumental step towards fortifying America’s national and economic security in the AI revolution, while ensuring we preserve just and reasonable rates for all Americans. I look forward to tackling more of these critical national issues with my colleagues in the New Year,” said Chairman Laura Swett.
Locking Up Power Plants
Thursday’s order grew out of a dispute between power plant owners and electric utilities over a proposed colocation deal between Amazon’s cloud-computing subsidiary and the owner of the Talen Susquehanna nuclear power plant in Pennsylvania, according to the Associated Press.
Utilities argued colocation allows big power users to avoid paying them to maintain the grid.
Some consumer advocates maintained that diverting energy from existing power plants to data centers could drive up energy prices without an answer for how rising power demand will be met for regular ratepayers.
In addition to the Talen Susquehanna nuclear power plant, energy companies have been buying or locking up existing power plants to serve A.I. data centers, including--
-- NRG bought five PA gas power plants with 2.4 Gigawatt capacity to help power data centers. Read more here.
-- Vistra Corp bought two PA gas power plants with 1.4 GigaWatt capacity to help power data centers. Read more here.
-- Capital Power announced $3 billion over 10 years to upgrade and expand a gas facility in Shamokin Dam, PA. Read more here.
-- The Tenaska Natural Gas Power Plant in Westmoreland County is also positioned to supply energy to data centers. Read more here.
-- Bitfarms Ltd is buying Stronghold Digital Mining and Scrubgrass and Panther Creek coal waste power plants to help power data centers. Read more here.
-- Google announced a 20-year agreement to repower the Safe Harbor and Holtwood hydroelectric facilities on the Susquehanna River to feed data centers. Read more here.
We Need Every Electron
There is no doubt the soaring demand for energy from A.I. data centers is already bringing Pennsylvania’s electric grid perilously close to being unreliable, as the results of the PJM capacity auction this week show.
Tom Rutigliano, Natural Resources Defense Council, said "Summer 2027 will be the first time in PJM’s history it expects to not have enough power to reliably meet demand because of new data center forecasts and the ongoing risk of fossil fuel [natural gas] generators failing during winter storms. Read more here.
"This auction leaves no doubt that data centers’ demand for electricity continues to far outstrip new supply, and the solution will require concerted action involving PJM, its stakeholders, state and federal partners, and the data center industry itself,” said Stu Bresler, PJM Executive Vice President – Market Services and Strategy, who becomes chief operating officer on Jan. 7. Read more here.
PUC Commissioner Kathryn Zerfuss said in another context-- “So we all know that we have many challenges as it relates to energy supply and demand, and the gap between supply and demand is just growing more and more every day.
“We totally maintain that we have to take advantage of every single molecule and electron we can from all energy sources, whether it's solar, wind, for our electric grid.” Read more here.
The Order
In the order, the Commission finds PJM’s tariff unjust and unreasonable due to a lack of clarity and consistency in the rates, terms, and conditions that apply to interconnection customers serving co-located load and eligible customers taking transmission service on behalf of co-located loads.
PJM’s tariff is unreasonable because it does not account for transmission services where eligible customers can manage energy withdrawals for co-located load.
FERC directs PJM to revise its tariff to require its eligible (transmission) customers serving co-located load to choose from several transmission service options.
“Clarifying new rules will help release the bottleneck of large load investments across the PJM footprint,” said Chairman Swett.
FERC also directs PJM to report, by January 19, 2026, on the status of its proposals to speed up the addition of generating capacity, including--
-- Expedited interconnection process for shovel-ready projects,
-- Changes to PJM’s reliability backstop mechanism for resource shortfalls, and
-- Enhanced load forecasting and demand flexibility measures to identify new capacity needed for system reliability.
Click Here for a fact sheet on the decision.
Click Here for the FERC announcement.
PA Oil & Gas Industry Public Notice Dashboards:
-- PA Oil & Gas Weekly Compliance Dashboard - Dec. 13 to 19 -- Shale Gas Abandoned Well Violations Hit 70; Conventional Well Not Plugged For 2,045 Days; MarkWest Loses Another 69,000 Of Pipeline Drilling Fluid To Mine Voids [PaEN]
-- DEP: MarkWest Liberty Midstream Reports 69,000 Gallon Pipeline Construction Fluid Loss Into Mine Voids Under Washington County; 476,600 Gallons Lost So Far [PaEN]
-- PA Oil & Gas Industrial Facilities: Permit Notices, Opportunities To Comment - December 20 [PaEN]
-- Susquehanna River Basin Commission Approves 3 Shale Gas Water Withdrawal Requests; 22 Total For 2025 [PaEN]
-- Susquehanna River Basin Commission Approved 31 Shale Gas Well Pad Water Use General Permits In November; 429 In 2025 [PaEN]
-- DEP Posted 51 Pages Of Permit-Related Notices In December 20 PA Bulletin [PaEN]
-- DEP Invites Comments On Renewal Of The NPDES Wastewater Permit For The BET Associates IV, LLC Anthracite Mining Discharge In Schuylkill, Carbon Counties Affecting 7,479 Acres [PaEN]
Related Articles This Week:
-- PJM Electricity Auction Prices Again At Cap Imposed By Gov. Shapiro’s Lawsuit Settlement, Without It Prices Would Be 59% Higher Driven By A.I. Data Center Demand; Grid Reliability Now Questioned [PaEN]
-- Federal Energy Regulatory Commission Orders PJM To Allow A.I. Data Centers To Connect Directly To Power Plants, Expedite Connections For Shovel-Ready Projects, Enhance Load Forecasting [PaEN]
-- In Case You Missed It: A.I./Data Center Articles - NewClips From Last Week - December 22 [PaEN]
-- Environmental Groups, Our Children’s Trust Appeal Air Quality Permit For Homer City A.I. Data Center 4.5 GW Natural Gas Power Plant In Indiana County [PaEN]
-- PUC Approves $50,000 Penalty Settlement With Peoples Natural Gas Following 2022 Johnstown Pipeline Damage, Fire Incident
-- PUC Approves Settlement With Kaib & Kaib LLC Over Alleged Overbilling Of Natural Gas Customers In Jefferson County; $4,066.16 In Refunds Due, $500 Penalty
-- PUC Chairman Steve DeFrank Recognizes Staff And 2025 Accomplishments
NewsClips:
-- Inside Climate News - Kiley Bense/Peter Aldhous: Tracking Oil And Gas Industry Waste In Pennsylvania Is Still A ‘Logistical Mess’ [Part I]
-- Inside Climate News - Kiley Bense/Peter Aldhous: 20 Years Into Shale Gas Fracking, Pennsylvania Has Yet To Reckon With Its Radioactive Waste [Part II]
-- Spotlight PA/Inside Climate News: Outdated, Disconnected Systems Leave PA Unable To Comprehensively Track Toxic Oil And Gas Industry Waste
-- Farm and Dairy: Shale Gas Well Pad Setback Petition Finally Moves On To PA DEP For Study
-- PennLive: PA DEP Staffing Lagging As State Faces Natural Gas Fracking, Air, Water Pollution Issues: Report
-- Warren Times: US Forest Service Closes American Refining Group Facility In Highland Twp., Elk County, Declares Them Unsafe Due To Hazardous Materials, Structurally Unsound Buildings [PDF of Article]
-- WHYY: Delaware City Refinery Failed To Immediately Report Accurate Butane Emissions
-- Utility Dive: FERC Orders PJM To Craft New A.I. Data Center Colocation Connection Rules
-- Reuters: FERC Directs PJM To Set New A.I. Data Center Rules On Direct Connection To Power Plants
-- Post-Gazette Guest Essay: Pennsylvania Energy Will Make America Affordable Again - By US Secretary Of Commerce Howard Lutnick
-- Public Citizen: President’s LNG Gas Energy Export Policy Costs Households $12 Billion In First 9 Months Of 2025
-- Bloomberg: American LNG Export Boom Means Goodbye To Cheap US Natural Gas
-- Inside Climate News: LNG Gas Exports Driving Up Americans’ Energy Bills, Report Says
-- Reuters: US Demands EU Exempt Its LNG Gas From Methane Emissions Reduction Law, Document Shows
[Posted: December 19, 2025] PA Environment Digest
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