OPC complaint challenges PJM cost rules for unfairly assigning $2 billion in data center-driven transmission costs to Marylanders
S E E D E D C O N T E N T
BALTIMORE – PJM Interconnection, LLC’s rules for assigning regional transmission costs driven by data centers violate the Federal Power Act and will unfairly inflate Marylanders’ electric bills, the Maryland Office of People’s Counsel said in a complaint today filed at the Federal Energy Regulatory Commission (FERC).
Of $22 billion in transmission project costs advanced over the last three years through PJM’s competitive regional transmission procurement windows, PJM’s rules for allocating these costs have unlawfully assigned Maryland customers responsibility for $2 billion in capital expenditures—costs that will be recovered in rates for decades and that will drive up Maryland customer bills by $1.6 billion over the next ten years alone, OPC’s complaint states.
“Without FERC action, Maryland customers face paying billions for transmission infrastructure that PJM is advancing to benefit data centers,” said Maryland People’s Counsel David S. Lapp. “PJM’s cost allocation rules are broken. Maryland customers have neither caused the need for these billions in new transmission projects nor will they meaningfully benefit from them.”
The relief requested in the complaint is also necessary to help fulfill the principles outlined in the “Ratepayer Protection Pledge,” signed by hyperscale data center developers at the White House on March 4, 2026, OPC’s complaint points out. That pledge states that the developers “will pay for new power delivery infrastructure upgrades to service their data centers, including adequate network upgrade costs to ensure that these expenses are not passed on to the ordinary household.”
OPC’s complaint challenges PJM’s “hybrid” transmission cost allocation methodology that broadly spreads costs that data centers cause across PJM. For high voltage projects (rated 500 kilovolts or higher), it allocates half of project costs across PJM transmission zones based on the proportion of demand each zone has relative to the entire PJM system. The other 50 percent is allocated using a “power flow” analysis that predicts how much of the power flowing through a particular transmission facility is consumed within each PJM area.
PJM is the regional electric transmission system operator serving all or parts of 13 states, including all of Maryland, and the District of Columbia.
OPC’s complaint—supported by a detailed expert’s affidavit—explains how PJM’s methodology creates severe financial consequences for Maryland ratepayers. Over the next ten years, the affidavit explains, PJM’s rules assign Maryland ratepayers—mostly customers of Baltimore Gas and Electric and Pepco—approximately $1.6 billion in added transmission costs to their electric bills over the next decade to support the energy demands of data centers, including:
- $823 million to residential customers (approximately $345 per average customer);
- $146 million to commercial customers ($673 per average customer); and
- $629 million to industrial customers ($15,074 per average customer).
The added costs to Marylanders bear no reasonable relationship to energy load growth occurring in Maryland, OPC’s complaint alleges. Forecasted load growth in Maryland is modest compared to Virginia and other areas of PJM, including Ohio, Pennsylvania, and Illinois, where demands driven by data centers are projected to grow substantially by 2036. The $22 billion in new transmission investment is overwhelmingly to meet the need created by data center demand. That means that Maryland customers are subsidizing data center-driven transmission buildout by virtue of geographic proximity and the pool-wide spreading of costs under PJM’s cost allocation methodology, not because they are causing the costs.
Ongoing efforts to address data centers through state-level “large-load tariffs” and utility “transmission security agreements” (TSAs) fail to remedy the problems with PJM’s rules governing cost allocation for regional transmission projects, OPC’s complaint explains. State large-load tariffs are laudable in that they seek to address costs associated with data center energy demands within a state, but they do not address costs assigned under PJM’s rules for transmission expansion costs driven by data centers located in other states. Likewise, TSAs that utilities have advanced fall far short of protecting customers from substantial data center costs and risks.
As a remedy to the unlawful subsidization of data center customers under PJM’s current methodology, OPC’s complaint asks FERC to require PJM to take immediate action to assign data center-driven transmission costs to the PJM zones where the data center customers are located (e.g., if located in Dominion Energy’s zone in Virginia, to the Dominion zone). Alternatively, depending on its rulemaking process for large-load customers, FERC should directly charge the transmission costs to the large data center customers, OPC argues.
OPC’s complaint highlights the “extreme uncertainty” of projections of data center load growth and points out that utilities benefit financially from transmission investments even if the projected load growth is speculative and the data centers never materialize, since most risks for electric infrastructure investments are borne by existing utility customers.
“We need immediate fixes to avoid billions of new costs placed on the backs of Maryland utility customers by data center energy growth,” Lapp said. “We need new rules to replace outdated rules that misalign the incentives of utilities that stand to profit significantly from building transmission, whether projections of data center growth are realized or not.”
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This is a very hot issue across the country right now. While I disagree that data centers are the worst neighbors for NIMBYs, it is infuriating how that industry is attempting to use the public to pay for their infrastructure needs.
it follows the professional sports model of the wealthy having the taxpayers build and pay for arenas for events they won't be able to afford to attend.
I was going to leave a similar comment.
because you're smart ...
The next thing...toll roads. Owned by corporations but totally funded by the taxpayer. MEGA churches built by taxpayers.
Call me crazy
Or Arks...
My electric bills were insane over winter. You try and make sense of the charges but it is impossible with the number of service fees with indecipherable titles, no doubt related to our portion of subsidizing multiple infrastructure expansions. Everyone in our area has been saying the same thing, with bills twice as high as last year at the same time.
Ours utility bills went way up too. It was the topic of discussion here all winter. We also have a proposed data center up across the bridge. Some of people living there have filed a law suit over improper permitting changes.
Welcome to Texas.
we've got one that almost circles the metro area. the joke here is the only people using it are those that don't have to pay to do so ...
We have a lot of newer congestion pricing toll roads in the DC area. They run parallel to the free lanes so it’s funny to see these random drivers on them on low traffic days when the free lanes are running at full speed. I guess it would be fun to have a free pass and use an expressway almost all to yourself.
depending upon the time of day, speed limits don't apply on them. usually during rush hour the cops are too busy dealing with the wreck caused gridlock on the other roads. unfortunately, since the POS maga king is unhappy with vote by mail colorado and the reluctance of TPTB here to put tina peters into general population where she would receive regular beatings for being a maga twat that tried and failed to help her hero to steal an election in 2020, the state has been installing speed cameras to makeup for the financial shortfall the state will be facing, because of a tantrum thrown by a moronic POS frat boy that by all rights should have come home from vietnam in a small box.
We came home yesterday and the 'navigator' starts telling me to get into t he express lane and we come up to the AI controlled pricing and it's $7.09 for the next 14 mile section and there's no traffic where we were
but I got on it anyway...
10 miles down, the normal lanes were at a complete standstill
2 miles further down they were using a crane to lift a pickup truck that was dangling off an overpass.
the "navigator" smiled...
it was worth the $ to be in the express lane.
home of deregulated utility costs that have been price fixed amongst the providers and approved by the governor ...
driving in texas is like driving in a whole 'nother country ...
my favorite memories are watching texas speeders in the DFW area on those 4 level interstate interchanges in the winter when the roads are frozen on the 3rd and 4th levels ... yee-haw!
I lived in Lubbock from 90-97. I don't remember toll roads. PA's got a ton of them
Most expensive "freeway" in the country. And there is ALWAYS construction going on somewhere.
State Leading in Road Construction in the U.S.
Based on recent federal and industry data, North Carolina is the state with the largest share of highway capital budget spending on road expansion, allocating 68% of its funds to expansion in 2023 Transportation For America . This makes it the top state in terms of prioritizing new road construction over repair or maintenance.
Why North Carolina Leads
Expansion Focus: While many states are shifting toward repair and preservation, North Carolina has maintained a heavy emphasis on building new road capacity, which aligns with its “road construction” category.
Highway Capital Budget: The state’s highway capital budget is the primary source of funding for new road projects, and its allocation toward expansion is the highest among all states.
Context: Other states like Arizona, Tennessee, Washington, Iowa, and Utah also spend a large portion (around 40%) on expansion, but none match North Carolina’s 68% Transportation For America .
That actually depends.....
I was in Western PA last September to go to a high school reunion. I was on the turnpike for about a mile maybe less.*** I never got a bill. Do they not charge you if you go a short distance?
***I was in a rental car and that's the way the GPS told me to go. Being unfamiliar with that stretch of hwy I did as I was told
One thing that is dramatically inflating construction and design fees is keeping up with the stormwater management regulations that states and the federal government have adopted, and these regulations never stop getting more onerous. The steeper the terrain, the more difficult it is to meet these requirements. Conversely, the flatter it is the more impossible it is to meet them, since these are effectively filters driven by gravity. Driving down 95 through Virginia it is shocking the amount of earthwork and forest removal taking place to accommodate roadway expansion for the sole purpose of stormwater treatment. It makes you wonder how much air pollution from construction and environmental damage from forest removal is worth the benefit of “cleaner” water, especially when the vast majority of microplastic pollution overall comes from tires, and none of these measures addresses that. Another problem I predict is coming is that we in the north are shooting ourselves in the foot by creating these perfect mosquito breeding grounds at the same time that mosquito borne infectious diseases are creeping northward due to climate change.
So does NY.
I found out last year that my NTTA gizmo works in OK and Florida. MY PA EZPASS also works in FL
Oh the joys of modern travel.
I teeter on the brink of becoming a regional serial killer if I have to listen to forced southern accents emanating from under straw cowboy hats for extended periods of time ...
It wasn't that bad. The scenery sucked ass, tho