PJM wholesale power costs jump nearly 76% in first quarter as capacity prices soar

The total wholesale cost of power in PJM Interconnection reached $136.53 per megawatt-hour in the first quarter of 2026, up from $77.78 a year earlier, an increase of almost 76%. The figures come from Monitoring Analytics, PJM's independent market monitor, in a report covered by E&E News on May 15, 2026. Capacity costs rose 398% and transmission costs about 5%. The monitor said data center load in the last two capacity auctions added about $13 billion in customer costs and that the price impacts on customers "have been very large and are not reversible."

Wholesale costs flow into the supply portion of business electric bills, whether you buy from a utility or a retail supplier. Businesses on variable or index-based supply contracts feel these increases first, and fixed-price contracts that renew in this environment are likely to be priced higher. Nationally, the Bureau of Labor Statistics reported electricity costs up more than 6% over the past year.

If you operate in PJM territory, pull your last 12 months of bills and note when your supply contract renews. Ask your supplier or energy broker how capacity charges are passed through in your contract and whether your peak demand affects your capacity cost allocation. Reducing load during the grid's peak hours can lower that allocation in many cases. Also ask whether a longer fixed term makes sense for your risk tolerance.

Even outside PJM, rising data center demand is a factor in power planning across the country, so energy should be a budget line you review at least annually.