PJM, the largest grid operator in the US, conducted its capacity auction for the 2028\/2029 delivery year. The auction ended when prices reached the price cap, indicating that ordinary Americans, who have been affected by PJM’s poor planning and rising energy prices due to anticipated energy demand from data centers, will face more expensive energy bills.<\/p>\n
The final price determined by the auction reflects the ongoing record-high electricity costs in the region. In April 2026, a coalition of state governors in PJM successfully negotiated a price cap for the next two years’ capacity auctions. However, despite this cap, PJM’s 67 million customers are paying more. Since June 2025, an independent analysis estimates that customer annual costs have increased by $12.5 billion in PJM. These costs rose from $2.2 billion in 2024 to $14.7 billion in 2025.<\/p>\n
The energy generation provided during the auction also shows the dominance of expensive and polluting fossil fuels. Instead of relying on cheap and reliable clean energy, 64% of the required energy for 2028\/2029 will be met with fossil fuels (46% natural gas and 18% coal).<\/p>\n
PJM plans to conduct a special “residual auction” in September. This auction will be held to ensure production capacity is reserved to serve large energy users (such as data centers). The participation in the September auction is uncertain, but according to the latest plans, it will have its own price cap, although it will not be bound by the $325\/MW price cap applicable to this and the next two auctions.<\/p>\n
Jessi Eidbo, Senior Advisor at the Sierra Club, stated: “It’s no surprise that auction prices have hit the price cap again and record-high prices for customers continue. Despite favorable economic conditions for battery storage, wind, and solar energy, auction participation remained low. This indicates the presence of other barriers that prevent access to zero marginal fuel sources that could alleviate the financial burden on households. Having a price cap is a good thing, but it’s only a temporary protection measure, not a permanent solution. We remain concerned about the September residual auction and subsequent auctions.”<\/p>\n
The Sierra Club is the largest and most effective environmental organization in the US, with millions of members and supporters. In addition to protecting the right to access and enjoy nature, the Sierra Club aims to promote clean energy, protect community health, preserve wildlife, and safeguard remaining wild areas.<\/p>\n