Sarah: PJM opened a fast lane the same day a federal court slammed the escape hatch shut.
Sarah: Quite a day for July 31.
Sarah: New to this story? Here's where things stand.
Sarah: PJM's large-load fight comes down to keeping the grid reliable and affordable while data-center demand strains the system.
Sarah: It already touches capacity-market cost pressure, backstop design, and federal oversight.
Sarah: Then there's the northern Virginia voltage disturbance, where more than three gigawatts of data-center demand dropped to backup power.
Sarah: That prompted PJM's board to direct a FERC filing on reliability backstop procurement and interim resource adequacy.
Matt: This is The Data Center Daily.
Matt: Today — a fast lane with a hard cap, a court ruling nobody's talking about, and a hundred-billion-dollar filing.
Matt: Who clears the bar, and who pays? Let's go.
Sarah: Jason McGovern, writing in PJM Inside Lines:
Quote: PJM began accepting applications July 31 for large generation projects that are backed by a primary siting authority and can commence
Quote: operation within three years.
Quote: The Expedited Interconnection Track (EIT) is a temporary
Quote: standalone process designed to address the urgent need for more capacity resources.
Quote: It was accepted by the Federal Energy Regulatory Commission on June 9.
Sarah: PJM's large-load response finally has an open lane.
Sarah: The Expedited Interconnection Track started taking applications July 31.
Sarah: It takes up to ten requests a year in 2026 and 2027, then sunsets.
Sarah: And the bar is pretty specific: 250 MW of unforced capacity
Sarah: operation within three years
Sarah: and a state siting authority that's already committed to speeding up permits.
Sarah: That last piece is what actually kills projects after they clear the grid.
Matt: Ten a year, though? PJM's got hundreds sitting in the base queue, and this window takes ten.
Matt: It won't fix the queue.
Matt: It's triage, and somebody's picking winners.
Sarah: It is triage. The target is ten months to a signed Generation Interconnection Agreement — signed, not announced.
Sarah: So the developers who show up with a state permitting partner already on board are the ones who get through.
Matt: And everybody else keeps waiting.
Matt: I'll root for the operators who make that 250-megawatt floor real inside three years — but let's not pretend ten slots make a dent in 70
Matt: gigawatts of large load.
Sarah: Here's Shayna Greene at Bloomberg Law:
Quote: The Federal Energy Regulatory Commission on Friday convinced an appeals court to uphold its order updating how transmission providers handle
Quote: electricity projects connecting to the grid.
Quote: The 2023 order which added study deadlines and established late fees
Quote: didn’t exceed FERC’s authority
Quote: according to the US Court of Appeals for the District of Columbia Circuit.
Matt: So the D.C. Circuit just told the slow-walkers: no more legal hidey-hole.
Matt: FERC's study deadlines and late fees stand.
Sarah: Right — the 2023 order survives intact.
Sarah: The court said FERC “identified a real problem” and picked a reasonable fix.
Sarah: That shuts down the biggest challenge hanging over the reform since '23.
Sarah: And put that next to the PJM expedited track we just covered — same day, July 31.
Sarah: The window opens, and the court closes the escape hatch in the same afternoon.
Sarah: The paperwork's finally catching up to the problem.
Matt: What kills me is it took a court ruling to make deadlines stick.
Matt: Late fees. On grid studies.
Matt: That's the bar we're clapping for.
Sarah: Buried in Amazon's latest 10-Q is a disclosure that changes the math on long-term AI compute contracts.
Sarah: Here's the language straight from the filing.
Quote: In Q2 2026
Quote: AWS and Anthropic announced an expansion of the strategic collaboration and existing multi-year commitment by more than $100.0 billion over
Quote: 10.0 years which includes contractual obligations related to the performance of AWS chips.
Matt: What gets me is the chip-performance clause.
Matt: Anthropic is essentially co-signing Amazon's custom silicon roadmap for a decade.
Matt: You don't see that in a standard hyperscaler offtake agreement
Matt: and it changes the calculus for anyone modeling Trainium capacity buildout or competing accelerator bids.
Sarah: Now watch what this anchor commitment does to AWS's interconnection queue priorities and infrastructure capex pacing.
Sarah: It's sitting inside a roughly $496 billion unrecognized contract book
Sarah: and when your largest AI tenant is locked in at this scale for this long
Sarah: you build differently.
Sarah: From CBS Texas:
Quote: ERCOT says by 2032, the grid could see peak demand of 175,000 megawatts.
Quote: That's nearly double the current record.
Quote: The big reason for the estimate is the explosive growth of AI-driven data centers.
Quote: Regulators told lawmakers this week they believe the grid can handle that growth
Quote: thanks in part to all the new solar power farms and battery storage facilities.
Quote: But ERCOT also warned that solar and batteries alone won't be enough.
Matt: Ninety-one thousand megawatts last week, and ERCOT's telling lawmakers 175,000 by 2032.
Matt: That's nearly double, and the driver is AI data centers.
Matt: Fine — but in the same week, lawmakers are asking whether Texas should keep handing those data centers billions in tax breaks.
Sarah: And Pablo Vegas said the quiet part on mic — over 90% of what's coming onto the grid is solar and batteries
Sarah: and that mix can't cover round-the-clock load.
Sarah: So the CEO's asking for gas while regulators tell senators the grid is fine.
Matt: So which is it? Either solar-and-storage can handle it, or you need dispatchable gas that you haven't built.
Matt: Can't tell the legislature both.
Sarah: It's the same who-pays fight we're watching in Nevada with NV Energy and Tract, just in a second jurisdiction with a bigger number.
Sarah: Texas has to decide whether ratepayers or the hyperscalers eat the baseload gap.
Sarah: The tax-break vote is where that bill gets priced.
Matt: Root for the grid people on this one.
Matt: They're the ones who'll have to keep the grid standing at 175 gigawatts in a July heat wave — 109 feels-like — while everyone else argues
Matt: about incentives.
Host: If The Data Center Daily keeps you informed, subscribe and leave a review wherever you’re listening.
Host: It’s a quick way to support the show and help more people find it.
Host: We’ll be watching PJM’s EIT process.
Host: It’ll accept proposals on a rolling basis until it reaches its 10-request limit for that calendar year
Host: and the whole track sunsets at the end of 2027.
Host: You’ll find links to every story in today’s show notes, if you’d like to dig deeper.
Host: That’s The Data Center Daily for today.
Host: This is a Lantern Podcast.