Maryland Residents to Bear $2 Billion in Grid Upgrade Costs for Out-of-State AI

The Maryland Office of People's Counsel (OPC), which represents Maryland residents, has filed a complaint with the Federal Energy Regulatory Commission (FERC) against the cost allocation plan of PJM Interconnection, the largest power transmission company in the United States.

PJM is planning a total of $22 billion in grid upgrades to respond to the surge in AI data center demand, and intends to charge $2 billion of this to the state of Maryland. The OPC has warned that this measure would generate approximately $1.6 billion in additional costs for Maryland consumers over the next 10 years.

The key issues are as follows:

• Unfair cost allocation: Despite Maryland's projected load growth being far lower than that of Virginia or Ohio, where data centers are concentrated, the state would be saddled with massive costs.
• Uncertainty in demand forecasts: Amid uncertain AI data center demand, there is a risk that existing utility customers would subsidize infrastructure investment costs even if the actual demand fails to materialize.
• Corporate accountability: Maryland argues that the costs of grid upgrades should be billed directly to the data center operating companies that actually benefit, rather than to existing customers.

Conflict over AI infrastructure expansion is intensifying across the United States, with as many as 69 jurisdictions having passed moratoriums (temporary suspensions) on data center construction, citing grid costs and the burden on local communities.