PA Environment Digest Blog: Gov. Shapiro's Legal Action To Impose Price Cap On PJM Interconnection Generation Capacity Auctions Results In Saving Consumers $13.3 Billion In Latest Power Auction

Thursday, July 16, 2026

Gov. Shapiro's Legal Action To Impose Price Cap On PJM Interconnection Generation Capacity Auctions Results In Saving Consumers $13.3 Billion In Latest Power Auction

On July 15, Gov. Josh Shapiro announced the extension of his settlement with PJM Interconnection-- which has already saved consumers $18.2 billion-- has once again protected consumers from unnecessary and unjustified energy costs, saving consumers an additional $13.3 billion in the 2028-29 capacity year.

The settlement reached in January 2025 required PJM to cap the price of securing electricity resources at $333 per Megawatt-Day for two capacity auctions.

In April 2026, the Federal Energy Regulatory Commission approved an extension of the price cap at $325 per Megawatt-Day for two additional auctions, including the July 2026 auction that just concluded.

Without the price cap, Pennsylvania consumers and consumers across PJM’s 13-state region could have been exposed to prices exceeding $554 per Megawatt-Day-- without corresponding reliability improvements to justify the increased cost. [Read more here.]

As a result of Governor Shapiro’s action, Pennsylvania homes and businesses will save over $2 billion in the 2028-29 delivery year.

This represents average savings of 9 percent on consumers’ electricity bills, or approximately $207 per household in the 2028-29 delivery year alone.

“For more than two years, I’ve been leading the push for the fundamental changes at PJM that are needed to ensure Pennsylvanians are not forced to pay more and more for electricity without seeing meaningful improvements in reliability,” said Governor Shapiro. “I sued PJM when they refused to act and secured a price cap that has saved consumers billions of dollars in unnecessary energy costs. But we cannot stop there — today’s auction results are a reminder that PJM’s broken system requires real reform. PJM must move faster to bring new energy resources online, strengthen transparency and accountability, and ensure decisions are made in the best interest of the 67 million people who rely on this grid — not just PJM’s members.”

Need For PJM Reform

The latest PJM auction results further underscore the need for PJM reform.

Despite nearly every available megawatt of energy clearing the auction, PJM still fell short of its reliability requirement by more than 6.8 gigawatts.

In December 2025, PJM also fell short of its reliability requirement for the 2027-28 delivery year by 6.5 gigawatts, demonstrating that high-capacity prices alone are not solving the region’s reliability challenges.

These challenges are driven by growing energy demand [from data centers] while PJM has struggled to bring new energy resources online quickly enough.

Resources continue to face significant delays in PJM’s interconnection queue, preventing needed generation from coming online and increasing pressure on consumers.

Governor Shapiro and his Administration are continuing to push for PJM governance reform to ensure states have a stronger voice in regional energy decisions and that PJM acts in the best interests of the 67 million people it serves.

Last week, the Governor signed improved electric load forecasting provisions into law, giving the Public Utility Commission expanded authority to review and validate the load forecasts utilities submit to PJM, building on similar legislation he signed in November 2025.

The reforms increase transparency, prevent double-counting of new large energy users like data centers, and protect consumers from price hikes driven by inaccurate projections.

FERC Technical Conference

To address the ongoing issues with PJM governance, FERC is holding a technical conference on July 23.

This is an important opportunity to improve state involvement in PJM’s decision-making processes and ensure PJM acts in the best interests of the region.

Governance reform is crucial to ensure solutions to the region’s affordability and reliability issues can be determined and implemented in a timely manner.

Click Here for Gov. Shapiro's announcement.

Resource Links:

-- Budget First Look: At Best A Cost To Carry Environmental Budget, Supports Oil & Gas Program Operations, Several Data Center Provisions But Not A Moratorium Or Pause [PaEN]

-- A.I. Data Center Legislative Scorecard: Pennsylvania Failed To Finalize Meaningful Legislation On Energy Affordability, To Increase Electric Generation And Give Communities The Tools They Need To Cope With A.I. Proposals [PaEN]

-- Environmental/Energy Groups: Final State Budget Fails To Address Critical A.I. Data Center Issues And Skyrocketing Energy Bills [PaEN]

-- PA Environmental Council: New State Budget Leaves A.I. Data Centers Unresolved, Big Win For Advanced Transmission Line Tech, Modest Progress On Other Energy Issues [PaEN]

-- More Reactions: Final State Budget Fails To Take On Growing Concerns About Energy Affordability And Keeping The Lights On [PaEN]

Related Articles This Week:

-- PJM Data Center-Driven Power Auction Prices Limited By $325/MW-Day Cap; Without Cap Would Have Been 70% Higher In PA, Most Areas; Missed Reliability Target By 6,831 MW [PaEN]

-- Gov. Shapiro's Legal Action To Impose Price Cap On PJM Interconnection Generation Capacity Auctions Results In Saving Consumers $13.3 Billion In Latest Power Auction [PaEN]

-- PJM Issues Hot Weather Alert For July 14 - 17; PJM Confirmed It Reached New All-Time Peak Load Demand 2,595 MW Over Previous Record [PaEN]

-- PJM Interconnection Issues Maximum Generation Alert For July 15; Requested & Received DOE Order To Put Data Centers On Backup Generators, Exceed Environmental Standards If Needed From July 15 To 21 [PaEN]