PJM’s ‘unexpected twist’ is a win for distributed capacity

This is a story about grid policy, not something that changes what a homeowner can do right now, but it touches the systems that keep power reliable and affordable in parts of the country served by PJM, the grid operator covering a large swath of the mid-Atlantic and Midwest.

PJM has been trying to figure out how to get enough electricity supply lined up as data centers drive up demand. Regulators just approved the broad outline of PJM's plan, which lets big power users sign direct deals for backup supply instead of risking being cut off during grid stress, with any remaining gap filled through an auction. But federal regulators delayed that auction by five months, saying PJM hadn't proven that data centers, not regular customers, would actually pay for the extra capacity being bought.

The delay gives more time for "virtual power plants," networks of home batteries, smart thermostats, and other small devices that can be bundled together and sold to the grid as backup capacity, to strike deals directly with data centers before the auction happens. PJM has also loosened some rules so these distributed setups, including batteries added to homes that already take part in demand response (programs that pay people to cut power use at peak times), count more easily toward this capacity.

None of this requires anything from homeowners yet. But if you already have a smart thermostat, battery, or other device enrolled in a demand response or similar program, these are the kinds of regulatory shifts that affect whether and how much your setup can earn.