A Maryland consumer protection agency is challenging how the Mid-Atlantic’s regional grid operator assigns the costs of new transmission projects.
“The rules are really an anachronism.”
David Lapp, Maryland Office of People’s Counsel
The Maryland Office of People’s Counsel filed a complaint May 7 with the Federal Energy Regulatory Commission (FERC) against PJM Interconnection, arguing that state residents are paying for infrastructure tied largely to out-of-state data center growth.
The complaint says PJM’s current cost allocation system would leave Maryland residential ratepayers saddled with about $823 million for new transmission projects over the next decade, or roughly $345 per average customer.
“The current rules for allocating transmission costs are premised on a different paradigm than we’re experiencing today,” People’s Counsel representative David Lapp told Technical.ly, “with the massive load growth and projected load growth of data centers.”
The fix, according to the People’s Counsel? Shifting transmission costs to the zones with the most data center demand, or charging those costs directly to data center companies themselves.
“I think common sense tells you data centers should be paying for those projects,” Lapp said.
The People’s Counsel previously raised concerns with PJM in 2024 and 2025 as more transmission projects were approved. The agency initially filed protests with FERC, which regulates interstate electricity transmission and wholesale power markets, asking it to change the cost allocation process. FERC directed the group to pursue the issue through a formal complaint instead.
PJM received an extension last week from FERC to respond to the complaint. PJM and its member utility organizations now have until July 27 to file responses.
FERC could resolve the complaint based on the written filings or move the case into an evidentiary hearing process, Lapp said.
Rules catching up to the data center boom
While PJM says new transmission projects are necessary to maintain overall grid reliability, the complaint argues Maryland customers are being forced to pay for upgrades mostly caused by Northern Virginia’s robust data center industry.
PJM splits transmission costs using formulas based on how much electricity each area uses and where power is expected to move across the grid.
Maryland’s complaint argues that those formulas violate the Federal Power Act by spreading costs across customers too broadly, when most new demand comes from Virginia and other parts of PJM’s territory outside of Maryland.
The filing also contends PJM’s modeling tools were designed for an era of slower, steady electricity growth — not for a sudden demand spike driven by one region or one industry.
“The rules are really an anachronism,” Lapp said. “They reflect an earlier time period.”
New transmission lines hit Maryland’s rural communities
PJM Interconnection has approved a wave of new transmission projects in recent years that will pass through Maryland.
Among them are the controversial Maryland Piedmont Reliability Project, which would run through Baltimore, Carroll and Frederick counties, and the Mid-Atlantic Resiliency Link (MARL), which would cross Garrett and Allegany counties in Western Maryland.
Both transmission lines would end in Northern Virginia, but still require approval from the Maryland Public Service Commission.
A representative from a Garrett County environmental group told Technical.ly in March that he fears the MARL project would harm local farms and change the region’s landscape.
“By disrupting the natural habitats that you see with these rolling hills and forests,” Mark Stutzman said, “it starts to not look like the Garrett County people have come to love.”
