PA Environment Digest Blog: Utility Dive: PJM Updates 20-Year Forecast Of Electricity Demand Growth, Reducing Short Term Growth Estimates By Up To 2.6%, Increasing 2035 Estimate By 3.3%

On January 15, Utility Dive reported the PJM Interconnection released an updated Long-Term Load Forecast Report that scaled back its load growth forecast through 2032 compared to last year’s estimates, but the report expects electric demand to surge past those expectations through the next decade

PJM expects its summer peak load will grow by 3.6% a year to about 222 GW by 2036, up from its previous 3.1% forecast. The increase totals about 65.7 GW over the next 10 years.

In a change that affects PJM’s upcoming capacity auction in July, the grid cut its peak demand forecast for the summer of 2028 by 4.4 GW, or 2.6%.

It also lowered its forecast for the summer of 2027 by about 4 GW, reducing a reserve margin shortfall for that capacity year to about 2.6 GW.

PJM said it anticipates lower peak demand in the near-term through 2032 due to updates to the electric vehicle and economic forecasts as well as improved vetting of requested adjustments for data centers and large loads.

The updated load forecast for summer 2026 predicts a drop in peak electricity use attributed to large loads (-0.7%), economic activity (-0.5%) and EVs (-0.1%) compared to the PJM 2025 Long-Term Load Forecast Report.

PJM expects its summer peak to climb about 85,000 MW, to over 241,000 MW, over the next 15 years. The record summer peak for the PJM footprint was 166,929 MW in 2006.

Winter peaks will remain slightly lower than the summer, the 2026 report continues to show winter closing the gap in peak electricity use, estimated at nearly 224,000 MW by 2041.

PJM’s record-high winter peak occurred on Jan. 22, 2025, when PJM served an average hourly load of approximately 143,336 MW.

Current generating capacity in PJM is approximately 182,000 MW.

Impact On Auction Prices

“We read the load revisions as reflective of pushouts/delays, NOT weakness in demand,” according to Jefferies equity analysts quoted by Utility Dive. “While we expect a 3-4 GW improvement in shortfall for [the] next two auctions, [the] market will still fall short — an accelerated backstop procurement is the way to go.”

Even if PJM secures an additional 10 GW in a procurement process, capacity prices will “comfortably clear” at the maximum price of about $530/MW-day in PJM’s next two capacity auctions, the analysts said.

[Note: A $333 MW/day market cap imposed on the two PJM auctions in 2025 as a result of a lawsuit by Gov. Shapiro expired. The cost of electricity capacity of the last auction without the cap was estimated to be $529 MW/day. Read more here.

[On December 3, Gov. Shapiro and five other PJM state governors wrote to the PJM Board recommending an extension of the price collar at least through the June auction. Read more here.]

The PJM zones with the strongest 10-year average annual summer peak growth forecasts are: PPL Electric at 6.4% (up from 5.9% last year); Dominion at 5.4% (down from 6.3%); AEP at 5.3% (down from 5.5%); DPL at 5.2% (up from 1.2%); and ComEd at 3.9% (up from 1.6%), according to PJM’s report.

After PJM stakeholders failed to agree last year on reforming the grid operator’s processes for adding large loads to its system, PJM’s board is expected to “outline its determination of a path forward on the [Critical Issue Fast Path] issues in the next few weeks,” PJM said in the news release.

Click Here to read the entire Utility Dive article.

Click Here to read the PJM announcement.