Maryland officials file formal complaint against PJM Interconnection over grid upgrade costs

Maryland officials have filed a formal complaint with the Federal Energy Regulatory Commission against PJM Interconnection. The state argues that its residents are unfairly subsidizing power grid upgrades intended for data centers in other regions. This legal action targets the cost allocation rules that determine how transmission infrastructure expenses are distributed among participating states.

State argues Maryland residents subsidize out-of-state AI data center power infrastructure

PJM plans to charge Maryland approximately $2 billion for grid upgrades. These funds cover a portion of the $22 billion total spent on regional transmission improvements. The upgrades are primarily designed to support the expansion of out-of-state artificial intelligence data centers. Maryland contends that its consumers have not caused the need for these projects and will not meaningfully benefit from them.

The financial burden on Maryland ratepayers extends beyond the immediate upgrade costs. Consumers face an additional $1.6 billion in expenses over the next ten years. Residential customers will see an increase of approximately $345 per customer. Commercial entities face an average cost of $673, while industrial users could see charges around $15,074. Maryland argues these costs violate President Donald Trump's ratepayer protection pledge by forcing local taxpayers to fund foreign infrastructure.

David S. Lapp, the Maryland People’s Counsel, stated that PJM’s cost allocation rules are broken. He warned that without regulatory intervention, Maryland customers will pay billions for infrastructure benefiting states like Virginia, Ohio, Pennsylvania, and Illinois. The complaint highlights a growing conflict between regional energy regulators and the rapid expansion of the AI industry. Maryland is seeking to shift the financial responsibility directly to the technology companies driving the demand.