PJM's 6.5 GW forecast cut and PSEG's nuclear deals: the data-centre load is being priced twice
Serguey Asael Shinder1 min readTwo reports from 3 November describe the same market from opposite sides. PJM has refiled its reliability backstop procurement, a special auction meant to fill a 6.8 GW capacity shortfall from its 2028/29 base residual auction, a gap driven by data centres. Analysts at Jefferies note that PJM utilities have since cut their near-term large-load forecasts by 6.5 GW, and estimate the procurement could fall to roughly 630 MW, or less if data-centre developers sign bilateral contracts.
At the same time, PSEG Power and Constellation Energy plan a 200 MW uprate at their jointly owned Salem nuclear plant in New Jersey, with Constellation's share supporting a nuclear-focused power purchase agreement with Google. PSEG's chief executive Ralph LaRossa told analysts the company is developing terms with large-load customers for existing nuclear output, future uprates and other generation, and said FERC's rejection of key parts of PJM's large-load interconnection plan shifts the cost questions to the states.
Read together, the two point to where the data-centre demand is going: out of the central auction and into bilateral deals with specific generators. That is exactly the scenario Jefferies names as a reason the backstop could shrink further. It also concentrates the operating risk: PSEG's quarterly filing says an inspection during the Salem 1 refuelling outage found a degraded thermal shield inside the reactor vessel, and that testing is expected to extend the outage.
What it means
For ratepayers, the shift to bilateral contracts is mostly good news, because the large load carries its own cost. For grid planners it means the forecast that drives the auctions is becoming less reliable, since the biggest new customers increasingly buy outside them.