Pennsylvania PUC to consider ratemaking, ROE and curtailment as data centers grow

Pennsylvania's Public Utility Commission voted this week to look into how the growth of data centers is affecting electric bills and grid reliability across the state. The commission pointed to a projected 18.56% increase in industrial electricity use over the next five years, driven largely by data center demand, along with a regional shortfall in power supply flagged by PJM, the grid operator serving Pennsylvania and much of the mid-Atlantic. That shortfall was estimated at nearly 6,831 megawatts for the 2028-29 period.

One part of the commission's action will update rules for emergency curtailment, the process utilities use to reduce power use during periods when demand outpaces supply. Officials will also hold a technical conference this fall to examine how the costs of serving large new electricity users, like data centers, get divided up, including whether those costs end up landing on other customers' bills. A tentative plan on curtailment rules is expected in October, with a possible final vote by the commission in late January.

Separately, the commission is forming a working group to study how utility rate cases are handled, including the profit margins utilities are allowed to earn and how clearly those numbers are explained to the public. Consumer advocates, utilities, and other groups will take part. For homeowners in Pennsylvania, this doesn't change anything on your bill right now, but it signals that regulators are trying to get ahead of rising costs tied to data center growth before those costs show up in future rate increases.