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PJM Auction Clears at Record $329.17 Per Megawatt-Day, Signaling Bill Hikes

Surging AI data center demand under constrained generation capacity drives the price jump expected to add 1.5 to 5 percent to average consumer electricity bills next year

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Electrity costs skyrocketed at an auction Tuesday that will mean higher bills for New Jersey residents.
New Jersey Democratic gubernatorial nominee Mikie Sherrill.

Overview

  • PJM’s July 2025 capacity auction settled at $329.17 per megawatt-day, a 22 percent increase from last year
  • A legal settlement capping prices followed a lawsuit by Pennsylvania Governor Josh Shapiro and limited what would have been a higher clearing price
  • PJM forecasts the record price will translate into a 1.5 to 5 percent increase in electricity bills for its 67 million customers across 13 states and Washington, D.C.
  • About 46 gigawatts of new generation have been approved but remain stalled by financing, permitting and supply chain challenges
  • Governors, consumer advocates and PJM officials are debating market design reforms and pushing to accelerate new capacity to close the supply gap