PJM Overrules Its Own Two-Thirds Vote

A Two-Thirds Vote, Overruled in Five Weeks

On June 30, 2026, PJM stakeholders voted on how to fix a widening capacity shortfall building across the mid-Atlantic grid. A coalition-backed Reliability Backstop Procurement plan, built around voluntary subscription, won support from more than two-thirds of PJM's sector-weighted membership, while every proposal on the table to curtail data centers and other large loads during a shortage was voted down.

Five weeks later, on July 27, 2026, PJM Board of Managers Chair Paula Conboy sent stakeholders a different answer. In a decisional letter closing out the same Critical Issue Fast Path process, the Board wrote that it "recognizes" the Coalition proposal's two-thirds support and "several constructive elements," but concluded that "a voluntary subscription framework would not provide sufficient assurance that capacity equal to the identified near-term shortfall would actually be procured." The Board directed PJM staff to file with FERC for a mandatory framework that includes exactly the curtailment tool the stakeholder majority had just rejected.

The reversal was not framed as a rebuke of the vote. Conboy's letter thanks the stakeholder community "for its substantial engagement" and states the Board "carefully considered" every alternative. But procedurally, PJM's governance lets the Board override a supermajority stakeholder vote when it judges reliability is at stake, and on July 27, it did exactly that.

What Interim Resource Adequacy Service Actually Does

The mechanism PJM filed is called Interim Resource Adequacy Service (IRAS), a rebrand of what stakeholders had been calling Connect and Manage. Under PJM's executive summary, any Large Load, defined as 50 megawatts or more of cumulative peak demand at one site, can still interconnect without bringing new generation. But if that load has not registered Bring Your Own New Capacity (BYONC), a cleared and in-service supply contract, by June 1, 2027, it becomes subject to automatic load reduction.

The ordering matters. PJM's own emergency-procedures diagram places the new IRAS action as the first lever the system pulls, ahead of Pre-Emergency Load Management Reductions, ahead of curtailing non-essential building load, ahead of every step PJM currently uses to protect residential and commercial customers during a shortage. A data center without a BYONC contract is now first in line, not last.

PJM is not asking large loads to absorb the cost for free. Electric Distributors must implement a FERC-approved compensation rate for reduced load, set at 50 percent of the existing Non-Performance Assessment Interval rate that FERC approved on June 26, 2026. Existing Large Loads already running before June 1, 2027 get until March 1, 2027 to register; anyone building new capacity faces annual BYONC filing deadlines of April 1 and verification by April 15.

The FERC Order PJM Is Actually Answering

PJM's filing did not happen in a vacuum. On June 18, 2026, FERC issued show cause orders to the country's jurisdictional regional transmission organizations, demanding each explain within 60 days why its existing large-load interconnection tariffs are just and reasonable, or rewrite them, and submit a mandatory reliability report within 30 days on how it will secure enough generation for growing large loads.

FERC's orders defined large loads the same way PJM ultimately did: 50 megawatts of peak demand interconnecting above 69 kilovolts. The Commission's underlying concern, drawn from NERC reliability reports, is that data centers and similar computational loads can swing their consumption by hundreds of megawatts within seconds, a speed that leaves grid operators with essentially no time to respond in real time.

PJM is now the most concrete public answer to that order among the RTOs it targeted. Where other grid operators are still drafting responses, PJM has already sent FERC a specific registry design, a specific curtailment trigger date and a specific compensation formula, a level of detail that puts pressure on peers like MISO and SPP to match it or explain why they have not.

Why the Reliability Math Forced the Board's Hand

The Board's letter is explicit about what changed its calculus. PJM has now cleared two consecutive Base Residual Auctions below its own Reliability Requirement, roughly 15 gigawatts of generation have retired from its footprint since 2022, and the grid operator's own projections put new Large Load demand growth at up to 70 gigawatts by 2038, a shortfall large enough that reporting on PJM's most recent capacity auction results put the identified gap at roughly 6.8 gigawatts, procured at a record cost of about 16.4 billion dollars.

Set against that math, a voluntary-only backstop looked to the Board like a bet the region could not afford to lose. The Board's letter states plainly that new Large Loads which do not bring or contract for their own new supply should not be allowed to impair the reliability of existing customers, language that reads less like a stakeholder compromise and more like a board setting a floor under its own authority.

For any operator planning a data center in PJM territory, the practical reading is straightforward: June 1, 2027 is now a real deadline, not a negotiating position, and the safest capacity commitment is one that has already cleared a PJM auction rather than one still working through a bilateral term sheet.

The August 13 Filing and the European Mirror

On August 13, 2026, PJM converted the Board's July 27 decisional letter into an actual filing with the Federal Energy Regulatory Commission, asking FERC to accept the petition within 60 days, to close the comment period on September 3, 2026, and to make the tariff revisions effective October 12, 2026. The filing keeps June 1, 2027 as the date curtailment exposure begins for any Large Load without a cleared and in-service BYONC contract, exactly as the Board's July 27 letter described. It adds one further mechanic the July 27 letter did not spell out in numbers: starting with the 2029/2030 delivery year, new Large Load megawatts that never bring their own supply are excluded from the Variable Resource Requirement curve PJM uses to calculate how much capacity the region must procure at auction, so a data center that skips BYONC does not just risk curtailment from 2027, it also stops counting toward the demand PJM plans capacity around.

PJM's filing now gives European and UK grid operators and regulators a concrete design to study, adopt or explicitly reject, at the exact moment they are working through the same interconnection-queue crisis. Servola has already covered ENTSO-E and the European Commission's own diagnosis that European grid investment needs to roughly double toward EUR 100 billion, and that data-center grid-connection requirements are tightening ahead of the EU's Cloud and AI Development Act, so this is not a US curiosity landing in a vacuum. The mechanisms differ in a way worth naming plainly. PJM curtails after connection, through an emergency dispatch order tied to a public registry and a generation-matching obligation on utilities. Europe's emerging approach, so far built from declarations of intent between associations and national improvisation such as Ireland's requirement that new data centers cover their own demand on site before its regulator reopens a frozen queue, mostly gates before connection, through minimum technical and generation requirements a project must meet to get a connection agreement at all. One is a condition of staying connected; the other is a condition of connecting in the first place, and an operator planning across both markets needs to satisfy both logics, not just one.

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