As data centers continue to grow rapidly—driven by artificial intelligence, cloud computing, and digital infrastructure—their power needs are putting pressure on the energy system. A wave of recent reports, regulations, and corporate actions highlight how interconnected the energy and data sectors have become. Below is a roundup of some of the most important recent stories shaping this space.

1. PJM Sounds the Alarm: Data Centers Driving Capacity Costs to New Heights
   At a recent Federal Energy Regulatory Commission (FERC) conference in June 2025, PJM Interconnection warned that rapid data center growth is reshaping electricity markets. PJM’s most recent capacity auction revealed a staggering increase in total capacity costs—from $2.2 billion to $14.7 billion—driven largely by forecasted data center load. Monitoring Analytics, PJM’s market monitor, bluntly warned that, “Data centers could overwhelm the grids if they chose to.” The proposed solution: require data center developers to procure or build their own generation.

2. Texas Steps In: New Law Requires Data Centers to Share the Load
   Texas passed Senate Bill 6 to proactively manage the surge in hyperscale data center power demand. The law introduces both mandatory and voluntary demand management programs for large loads over 75 MW, allowing utilities to disconnect these loads during firm load-shed events. It also imposes new transparency and interconnection fee requirements aimed at eliminating phantom load requests that clog the system. While the legislation responds to Texas-specific reliability concerns, its core provisions will likely influence policy discussions in other states.

3. EIA: U.S. Electricity Demand to Hit Record Highs in 2025 and 2026
   The U.S. Energy Information Administration now projects that overall power demand will reach 4,193 billion kWh in 2025 and 4,283 billion kWh in 2026—both new records. The agency attributes this rise in large part to the explosion of data center and AI activity. While renewables will increase from 23% to 25% of the energy mix by 2025, natural gas is still expected to supply 40%, and nuclear will remain steady at 19%. The forecast underlines the urgency of diversifying energy sources to meet new load.

4. Bloom Energy: Onsite Generation to Fully Power 27% of Data Centers by 2030
   A mid-year update from Bloom Energy’s 2025 Data Center Power Report revealed that onsite generation is no longer a backup plan—it’s becoming a primary strategy. Currently, just 1% of data centers rely fully on onsite generation. By 2030, that number is expected to grow to 27%. The report also found that 84% of data center executives now rank power access as one of their top three site selection criteria. Perhaps most notably, utility timelines for delivering power are reportedly underestimated by up to two years by developers, leading more to turn toward self-generation.

5. Deloitte: AI Could Drive 30x Surge in Data Center Power Demand by 2035
   A June 2025 Deloitte report warns that AI-driven data center demand could grow thirtyfold by 2035. The report also found that 72% of surveyed power and data center executives rate power and grid constraints as “very” or “extremely” challenging. Deloitte emphasizes that closing the gap will require not only new generation but also collaboration across energy, manufacturing, and infrastructure sectors—and regulatory innovation to match.

6. Meta Bets Big on Geothermal for New Mexico Data Center
   Meta is expanding its use of alternative energy sources with a new deal to support the development of 150 MW of enhanced geothermal energy in New Mexico. The deal, in partnership with XGS Energy, will directly support Meta’s data center operations in the state and reflects a growing corporate appetite for carbon-free, weather-independent generation. The $1 billion investment includes both economic development and energy security components, signaling the maturation of geothermal as a viable commercial-scale source.

7. Meta Adds Over 1 GW of Renewables to Power Its Data Centers
   In a series of announcements this summer, Meta revealed that it has contracted for over 1 GW of new renewable energy—primarily solar and wind—to power data centers across Ohio, Arkansas, and Texas. The deals include projects from Invenergy, Adapture Renewables, and AES, with commercial operation expected in 2027 and 2028. The company also emphasized the speed-to-power advantage of solar: typical farms can be completed in 18 months or less, and phased construction can begin delivering electricity even sooner. The strategy highlights how solar remains one of the fastest ways to meet hyperscale data center loads.

Conclusion

Power availability has become a top concern for data center developers, often outranking land, fiber, and tax incentives. As both industry reports and public policy show, the pressure on the grid is real—and growing. Onsite and alternative power sources are becoming essential to keep up with demand and bring projects online. We’ll continue to monitor and keep you informed about new developments in this space.