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Guest Essay: Significant Electricity Load Growth Can Be Accommodated Without A Stampede To New Natural Gas Generation Just By Increasing Efficiency At Existing Power Plants

By John Quigley, Senior Fellow, Kleinman Center For Energy Policy

The stampede to gas in the PJM service territory continues unabated, driven by forecasts of high demand from data centers, and despite evidence for caution.

But smarter approaches, if carefully applied, could help to reverse costly reliance on gas, and accelerate the clean energy transition in PJM, and nationwide.

Last week, the Federal Energy Regulatory Commission approved PJM’s proposed Reliability Resource Initiative (RRI), allowing new natural gas-fired power plants to jump to the front of the interconnection queue for fast-track review—ahead of the clean energy projects that comprise 97.5% of the proposed generation in the queue.

The new gas plants should not be needed, according to comments submitted by the Natural Resources Defense Council to a Pennsylvania Public Utility Commission docket on increased energy demand.

NRDC calculated that if the existing gas fleet in PJM could increase reliability from its current 76% during winter storms to an achievable 90–95%, there would be no imminent capacity problem at all and no need to panic-approve new gas generation.

Still, PJM’s RRI plan moves forward. FERC Commissioner Judy Chang dissented from the approval, saying that “(b)y facilitating queue jumping for large generators, which are the most challenging to develop… and focusing primarily on large generators over speed of development, PJM’s proposal may not actually resolve its impending capacity shortage.”

As I wrote here, PJM’s own numbers show that solar plus battery storage, which takes much less time to construct than gas plants, can have higher reliability values than gas plants.

Worsening PJM’s gas dependence with the RRI also promises to lock in substantially higher energy costs.

In December, 2024, the U.S. Department of Energy estimated that unrestricted exports of LNG will increase wholesale domestic gas prices by over 30% by 2050. Meanwhile, it remains profoundly cheaper to produce electricity from solar than from new fossil fuel sources.

On the bright side, FERC also approved PJM’s Surplus Interconnection Service (SIS) plan that establishes broadly supported rules for new clean energy sources to connect to the grid at the site of an existing generator.

PJM has also proposed to FERC to allow quicker reuse of grid connections at closing coal-fired power plants. Both moves could help get more clean energy onto the grid.

Even more promising is an important new study from the Nicholas Institute for Energy, Environment & Sustainability at Duke University.

It finds that planned load flexibility at data centers can minimize—or even eliminate—any near-term need to build new gas plants to meet load growth.

Duke researchers found that if large electricity users like data centers can plan to reduce consumption or use on-site generation or batteries for short periods when grid stress is highest, that would allow almost 100GW of new load to be added to the grid while maintaining reliability and affordability.

That’s almost three times the amount of projected data center load growth nationally by 2030.

The study estimates 18GW of “curtailment-enabled headroom” potential in PJM alone—more than triple PJM’s estimated data center load growth of 5GW by 2030.

Even without reexamining forecasting assumptions or improving the reliability of the existing gas fleet, the Duke study offers PJM (and grid managers nationally) a near-term approach that could allow them to meet the demands of electrification and data center proliferation while avoiding costly fossil fuel investments.

It can buy time for PJM to focus on high-value additions to the grid through its SSI, the cheaper clean energy waiting in the queue, and deployment of grid enhancing technologies.

John Quigley is a Senior Fellow at the Kleinman Center for Energy Policy and a former Secretary of the Pennsylvania Department of Environmental Protection and the Department of Conservation and Natural Resources.

NewsClip:

-- Kleinman Center For Energy Policy: Significant Electricity Load Growth Can Be Accommodated Without A Stampede To New Natural Gas Generation Just By Increasing Efficiency At Existing Power Plants - By John Quigley, Senior Fellow, Kleinman Center

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