Key facts
- The U.S. Department of Energy issued an emergency order for PJM Interconnection.
- The order addresses soaring electricity demand and supply risks from an extreme heatwave.
- PJM Interconnection warned of potential rotating outages and significant transmission line congestion.
- Spot wholesale electricity prices surged to nearly $300 per megawatt hour.
- Peak demand is forecast to break an all-time record on Thursday.
The U.S. Department of Energy has issued an emergency order for PJM Interconnection, the largest U.S. electric grid operator, as an extreme heatwave drives soaring demand and strains supply. PJM warned of significant transmission line congestion and potential price spikes, with spot wholesale electricity prices surging to nearly $300 per megawatt hour early Wednesday.
The grid operator signaled a higher risk of rotating outages due to weakening voltage levels on transmission lines and has alerted power plants to be ready to meet demand. Grid expert Georg Rute noted that extreme heat, low wind, and surging demand are coinciding when transmission lines have minimal safety margins, contributing to price increases.
Temperatures are forecast to hover around 100°Fahrenheit, increasing air-conditioning demand. PJM expects demand to reach 166.3 gigawatts on Thursday, potentially breaking an all-time record set 20 years ago. The grid operator has 18 GW of reserve power resources available. Meanwhile, spot electricity prices could spike to over $1,000 per MWh Wednesday evening. In the Midwest, the Midcontinent Independent System Operator (MISO) also anticipates breaking its demand record.