ER26-3380-000 · 2026-08-21 · Data Center Coalition

Comments of the Data Center Coalition in response to PJM Interconnection, L.L.C.’s 07/31/2026 proposed tariff filing to establish the Reliability Backstop Procurement

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UNITED STATES OF AMERICA 
BEFORE THE  
FEDERAL ENERGY REGULATORY COMMISSION 
 
                                                                      
PJM Interconnection, L.L.C.                            )  
 
  Docket No. ER26-3380-000 
 
 
COMMENTS OF THE DATA CENTER COALITION 
 
Pursuant to the Federal Energy Regulatory Commission’s (“Commission” or “FERC”) 
Rules of Practice and Procedure, the Data Center Coalition (“DCC”) respectfully submits these 
comments in response to PJM Interconnection, L.L.C.’s (“PJM”) July 31, 2026 filing proposing 
to establish the Reliability Backstop Procurement (“RBP”). 
DCC is the membership organization for the U.S. data center industry, representing 
leading data center owners and operators that maintain data center infrastructure and teams 
across the country.1 DCC members build, own, and operate data centers that constitute 
significant loads within the PJM region, and DCC has been an active stakeholder in regional 
efforts to ensure reliability, enable new generation, and discipline regional load forecasts. DCC’s 
member companies provide the essential digital infrastructure that underpins the modern 
economy and supports critical public services, including cloud computing, artificial intelligence, 
emergency response systems, and public safety operations. 
From 2017 to 2023, the data center industry contributed $3.5 trillion to U.S. GDP. As the 
industry unlocks economic opportunities across the country and the PJM region, supporting 
affordability is a foundational priority for DCC members and the communities they serve. DCC 
advocates for grid reforms that minimize unnecessary cost burdens, align with cost causation, 
 
1 The Data Center Coalition is a membership organization of leading data center owners and operators. Public 
testimony and written comments submitted by DCC do not necessarily reflect the views of each individual DCC 
member. A list of current DCC members is accessible at https://www.datacentercoalition.org/members.

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facilitate responsible load growth, and support the development of new generation without 
imposing undue costs on existing ratepayers. While maintaining reliability is ultimately the 
responsibility of utilities, grid operators, electric reliability organizations, and regulators, DCC 
members are also leaning in and leading as engaged partners supporting regional reliability 
during periods of grid stress, including extreme weather, generation outages, and sudden load 
spikes.  
DCC has consistently maintained that the most durable solution to PJM’s resource 
adequacy challenge is to enable customers adding significant new demand to bring new supply 
with them. DCC members are prepared to do so. Throughout PJM’s Critical Issue Fast Path 
process, DCC advocated for a framework that would provide large loads a predictable pathway 
to procure new capacity bilaterally while avoiding duplicative procurement and double payment. 
DCC continues to believe bilateral procurement should be the preferred path for customers 
prepared to make those investments. 
The RBP filed by PJM is not the framework DCC proposed. DCC, together with several 
PJM Electric Distribution Companies, supported an opt-in construct that would have provided 
customers greater flexibility to choose between bilateral procurement and participation in a 
centralized backstop. Nevertheless, the filed proposal incorporates several important elements of 
the Joint EDC/DCC proposal and, critically, recognizes qualifying bilateral contracts and self-
supply arrangements as offsets to the amount PJM will procure through the RBP. PJM itself 
acknowledges that significant components of the filed construct originated in the Joint 
EDC/DCC proposal. 
Given the urgency of PJM’s resource adequacy challenge, DCC supports moving forward 
with the RBP as a limited, one-time backstop. DCC therefore urges the Commission to accept

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PJM’s filing while ensuring that its implementation preserves customers’ ability and incentive to 
bring new supply to the system, appropriately assigns costs, and remains coupled with the 
broader reforms necessary to get new infrastructure built. 
I. The Commission Should Preserve and Facilitate Bilateral Procurement of New Capacity 
DCC strongly supports PJM’s recognition of bilateral procurement and self-supply 
through the Qualifying RBP Offset UCAP MW framework. 
That recognition is fundamental to the design. The RBP should be a backstop—not a 
substitute for bilateral investment. Where a customer has arranged for qualifying new capacity to 
serve its incremental demand, PJM should not procure duplicative capacity on that customer’s 
behalf. Doing so would increase the size and cost of the RBP without providing a corresponding 
reliability benefit. 
PJM recognizes this principle in its filing. The Initial RBP Target will be reduced for 
documented bilateral contracts and qualifying self-supply arrangements for new capacity serving 
new load. This approach appropriately creates a parallel pathway for customers to address their 
resource adequacy needs directly rather than relying exclusively on centralized procurement. 
The Commission should preserve that pathway and ensure it is commercially workable. 
In particular, implementation of the Qualifying RBP Offset framework should provide clear and 
timely standards for demonstrating bilateral arrangements. PJM should require only the 
information reasonably necessary to establish that an arrangement satisfies the Tariff 
requirements and should protect commercially sensitive information contained in PPAs and other 
bilateral contracts. Customers should not be required to disclose pricing or other commercially 
sensitive terms that are unrelated to PJM’s determination of whether the associated capacity 
qualifies for an offset. Additionally, PPA counterparties are often affiliates of the customer 
bringing new load online—but not necessarily the same entity, the Commission should make

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clear that the party entering into the bilateral contract need not be the same legal entity as the 
large-load customer bringing new demand online, so long as the contracting party is acting on 
that customer’s behalf or for that customer’s benefit, including through an affiliate arrangement. 
Clarity is particularly important given the compressed implementation schedule 
contemplated by PJM. The Commission should encourage PJM to provide customers with 
sufficient information, well in advance of the RBP information window, to understand what 
documentation will be required and how confidential commercial information will be protected. 
The objective should be straightforward: every MW of qualifying new capacity that a 
customer brings to PJM should receive appropriate recognition before PJM determines how 
much additional capacity must be procured through the backstop.  
II. RBP Costs Must Be Allocated to the Large Loads Driving the Need for New Capacity  
DCC supports PJM taking action to address the full resource adequacy shortfall identified 
through the 2028/2029 Base Residual Auction. But support for addressing that reliability need 
must be accompanied by an equally firm commitment to ensuring that the substantial costs of the 
RBP are appropriately assigned. The costs associated with serving new large loads should be 
borne by new large loads contributing to resource inadequacy and should not be shifted to 
existing residential, commercial, or industrial customers or new large loads that have not 
contributed to resource inadequacy. 
Cost allocation was a central concern for DCC throughout the CIFP process and an 
important reason DCC supported the voluntary, opt-in framework reflected in the Joint 
EDC/DCC Proposal. Under an opt-in construct, there would have been a direct relationship 
between a large load's decision to participate in the procurement and its responsibility for the 
resulting costs. PJM instead elected to procure capacity sufficient to address the full identified 
shortfall through a mandatory backstop. DCC supports PJM taking action to address that

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shortfall, but the broader procurement makes it all the more important that the resulting costs 
ultimately follow the large-load growth driving the need for new capacity. 
The magnitude and duration of the potential costs underscore the importance of getting 
this right. PJM proposes to procure approximately 6.8 GW of new capacity through 
commitments that may extend for as long as fifteen years. Those commitments will result in 
substantial long-term payment obligations. An allocation methodology that allows even a portion 
of those costs to migrate to customers that are not responsible for the incremental load growth 
would undermine a fundamental premise of the RBP and risk creating precisely the type of cost 
shifting that DCC and other stakeholders have sought to avoid. 
PJM appropriately recognizes that, while it can establish the allocation of RBP costs at 
wholesale, the assignment of those costs to individual retail customers remains a matter of state 
jurisdiction. That distinction is important, but it means that Commission acceptance of PJM's 
filing is only the first step in getting cost allocation right. Significant work will be required at the 
state level to translate PJM's wholesale allocation into retail tariffs that accurately assign RBP 
costs to the large loads responsible for the incremental demand, while protecting other customers 
from inappropriate cost shifts. 
Those state mechanisms must also appropriately recognize large loads that have taken 
responsibility for their growth by bringing new capacity to the system. A customer that supports 
qualifying new generation should receive the benefit of that investment both in reducing the 
amount PJM procures through the RBP and in the ultimate allocation of RBP costs. Otherwise, 
customers could face the very double-payment problem that the Qualifying RBP Offset 
framework is intended to prevent.

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DCC has already committed to working constructively on these issues. DCC and the 
Virginia State Corporation Commission have agreed to work together to develop model retail 
tariff provisions designed to appropriately assign RBP costs while avoiding cost shifts to other 
customers. DCC intends to continue that work and encourages similar efforts among state 
commissions, utilities, large-load customers, and other stakeholders throughout the PJM 
footprint. 
The Commission should recognize the importance of that state implementation process in 
considering PJM's filing. DCC supports PJM's decision to leave customer-level retail allocation 
to the states and encourages PJM to provide states and Electric Distributors with the information 
necessary to implement those allocations accurately and transparently. Ultimately, the RBP's 
cost-allocation framework should accomplish a straightforward objective: large loads should pay 
the costs associated with serving their incremental demand, receive appropriate credit when they 
bring new capacity to meet that demand, and existing customers should not be left with the bill. 
III. The RBP Can Support Reliability Only If Procured Resources Reach Commercial 
Operation  
The RBP can improve resource adequacy only if the resources it procures actually reach 
commercial operation in time to address the identified reliability need. 
PJM proposes to make commitments of up to fifteen years to resources capable of 
bringing new capacity to the system. But a long-term revenue commitment does not itself ensure 
that a resource can be studied, interconnected, permitted, and constructed on the timeline 
required. Nor does it ensure that the interconnection facilities and transmission upgrades 
necessary to deliver that resource can be planned, permitted, and constructed on time. 
The Commission should therefore evaluate the RBP not simply as a procurement 
mechanism, but as one part of the broader process necessary to bring new capacity online. The

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measure of success should not be how many MW PJM contracts for, but how many MW actually 
reach commercial operation in time to address the identified reliability need. 
That will require continued progress on generator interconnection. DCC supports PJM’s 
recent efforts to accelerate viable generation through initiatives such as the Reliability Resource 
Initiative and Expedited Interconnection Track. Those measures are important, but the 
underlying challenge remains. PJM must continue reducing study timelines, processing its 
interconnection queue, identifying necessary interconnection facilities and transmission 
upgrades, and providing generation developers sufficient certainty to finance and construct 
projects. 
The same urgency must extend to the facilities necessary to interconnect and deliver 
those resources. A generation project cannot contribute to reliability merely because the 
generating facility itself is ready to proceed. The necessary interconnection facilities and 
transmission upgrades must also be studied, approved, sited, permitted, and constructed on a 
timeline that allows the resource to reach commercial operation when PJM needs it. Delays 
affecting those facilities can become just as binding a constraint on new supply as delays 
affecting the generating resource itself. 
Many of those steps extend beyond PJM’s control. Generation projects, interconnection 
facilities, and transmission infrastructure may require state and local permits, siting approvals, 
rights-of-way, equipment, fuel infrastructure where applicable, and other approvals before 
construction can be completed. States therefore have an equally important role in ensuring that 
resources capable of meeting PJM’s reliability needs—and the infrastructure necessary to 
connect those resources to the system—can actually be constructed on the required timeline.

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DCC encourages states across the PJM footprint to examine opportunities to accelerate 
permitting and siting of generation, interconnection facilities, and transmission infrastructure 
while maintaining appropriate environmental and community protections. PJM, for its part, 
should continue working to ensure that its interconnection and transmission planning processes 
identify and advance the facilities necessary for RBP resources to reach commercial operation 
without avoidable delay. 
The region’s challenge is increasingly straightforward: PJM needs substantially more 
infrastructure, and it needs that infrastructure faster. Procurement can help provide the revenue 
certainty necessary to support investment, but procurement alone does not produce a functioning 
reliability resource. The RBP will achieve its purpose only if the resources it supports—and the 
interconnection and transmission facilities necessary to deliver their output—can be studied, 
permitted, sited, constructed, and placed in service on the timeline required. 
IV. Conclusion 
DCC supports the Commission’s acceptance of PJM’s proposed Reliability Backstop 
Procurement as a limited, one-time measure to address the immediate resource adequacy 
shortfall. 
At the same time, the RBP should remain what its name suggests: a backstop. Customers 
willing to bring qualifying new capacity to the PJM system should continue to have a meaningful 
bilateral pathway to do so and should receive full recognition for those investments. RBP costs 
should be allocated consistent with cost causation without shifting costs to customers that did not 
cause them, with retail implementation appropriately left to the states. 
Most importantly, the RBP cannot supplant the work necessary to get infrastructure built. 
DCC urges PJM, the Commission, and the states to maintain their focus on accelerating

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interconnection, transmission development, permitting, and siting so that new generation can 
actually come online at the pace necessary to support reliability and continued economic growth. 
For these reasons, DCC respectfully requests that the Commission accept PJM’s filing 
consistent with the principles discussed above. 
Respectfully submitted,  
/s/ Morgan A. Sipple                  
Morgan A. Sipple 
Director, Energy Policy – FERC and RTOs 
DATA CENTER COALITION 
1250 H Street, NW 
Washington, DC 20005 
morgan@datacentercoalition.org  
 
Dated: August 21, 2026

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 CERTIFICATE OF SERVICE 
I hereby certify that I have this day served the foregoing document on each person 
designated on the official service list compiled by the Secretary of the Federal Energy Regulatory 
Commission in this proceeding. 
Dated in Washington, D.C., on this 21st day of August, 2026. 
 
 
 
/s/ Morgan A. Sipple                  
Morgan A. Sipple 
Director, Energy Policy – FERC and RTOs 
DATA CENTER COALITION 
1250 H Street, NW 
Washington, DC 20005 
morgan@datacentercoalition.org