Trump set to expand power cost pledge on data centers

• The PJM Interconnection, serving 67 million people, saw transmission congestion costs surge 81% to $3.2 billion in 2025, with last week's power auction reaching record price levels
• FERC is meeting Thursday to examine PJM's worsening supply-demand imbalance as the grid struggles with the one-size-fits-all model
• Large data center customers may face decade-long waits for service while the expanded pledge involves governors, lawmakers, utilities and data center developers in the nonbinding agreement

Trump Expands Data Center Power Cost Pledge to Protect Households

President Trump is unveiling an expanded Ratepayer Protection Pledge on Thursday aimed at preventing AI-driven data center electricity costs from being passed to average households. The non-binding pledge now covers 80% of all power delivered to U.S. homes and businesses, requiring data center builders and operators to pay above normal rates.

Key Participants:

The White House event will feature Energy Secretary Chris Wright, EPA Administrator Lee Zeldin, and state governors who signed the original pledge, alongside utilities and data center developers.

Critical Infrastructure Challenges:

The initiative comes as U.S. regional electric grids face severe strain. In PJM Interconnection—the nation's largest grid serving 67 million people—transmission line congestion surged 81% to $3.2 billion in 2025. Last week's annual power auction at PJM hit record-high prices, prompting the Federal Energy Regulatory Commission (FERC) to meet Thursday to address PJM's worsening supply-demand imbalance.

Industry Tensions:

The Cato Institute's Travis Fisher warns the current "one-size-fits-all" electricity model poorly serves both residential and industrial customers, with large data centers potentially waiting a decade or longer for service while ratepayers fear higher bills from grid expansion.

Data center advocates counter that industry growth is spurring necessary grid investments and point to other cost drivers, including power plant retirements and transmission constraints.

Market Implications:

The pledge reflects growing concern over AI infrastructure's impact on electricity markets and household costs. While aimed at promoting U.S. AI leadership, the non-binding nature raises questions about enforcement. The timing coincides with critical regulatory discussions about grid reliability and pricing in major electricity markets.