Severe cold weather in half the US has driven unexpectedly high electricity demand in PJM, particularly Virginia, a global data center hub. This has pushed wholesale prices to $1,800/MWh, and nearly 9 power outages have been reported across several states.
On January 26, 2025, at 2:55 PM, CNBC reported that: Electricity prices on the U.S.'s largest power grid rose sharply on Sunday. Following higher-than-expected electricity demand in the world's most congested data center region, amid a severe cold snap sweeping half the country,
Real-time wholesale electricity prices soared above $1,800 per megawatt-hour (MWh) early Sunday morning in Dominion Energy's Virginia service area, up from around $200 per MWh Saturday morning. Virginia is home to some of the world's largest data centers.
Data centers, which power systems such as artificial intelligence (AI), are a major factor driving up electricity demand and energy prices in many areas of the country.
Data from PJM Interconnection, which manages the largest regional power grid in the United States, serving approximately 67 million people, indicates that the surge in electricity demand began late Saturday night as Winter Storm Fern moved through several areas.
PJM forecasts record winter electricity demand on Tuesday, driven partly by data center power needs. Dominion, meanwhile, indicates that continued freezing temperatures throughout the week, along with heavy snowfall, could be one of the most impactful winter events on the company's operations. PJM projects electricity demand to reach 147.2 gigawatts (GW), surpassing its previous record of 143.7 GW set in January 2025.
Dominion did not immediately comment on Sunday's price movements. In the company's PJM area, power demand approached 23 gigawatt-hours at 10:00 AM Eastern Time, about 5% higher than initial forecasts, according to PJM.
Throughout the weekend, spot electricity prices across the United States remained high as regional grids bogged down by surging demand. When demand exceeded expectations, utilities may have to purchase electricity at higher spot prices to supply residential and commercial customers.
Regional power grids are sending electricity to local transmission lines that supply homes and businesses, and several outages are currently occurring. Nearly 900,000 users were out on Sunday, according to PowerOutage.us. This includes more than 300,000 users in Tennessee and over 100,000 in each of Mississippi, Texas, and Louisiana. Other affected states include Kentucky, Georgia, Virginia, and Alabama.
refer : cnbc.com
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