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Constellation Energy Corporation (NASDAQ:CEG) factored into the discussion surrounding speculative stocks. Quantum computing and nuclear stocks were two categories that Cramer was worried about during the show. For nuclear power, he asserted that these projects have long development timelines. Constellation Energy Corporation (NASDAQ:CEG)’s shares have gained 37% year-to-date, and the firm has benefited from big tech’s push to use nuclear power for AI data centers. Cramer discussed the share price:
Investing.com -- Bank of America has downgraded Oklo and NuScale, warning that valuations for the two U.S. small modular reactor (SMR) developers have run “ahead of reality.”
In a research note, BofA cut Oklo to Neutral from Buy and lowered NuScale to Underperform from Neutral. “Valuations now embed deployment ramps and discount rates we view as unrealistic at this stage of SMR adoption,” the analysts wrote.
Their reverse discounted cash flow models, using a 14% discount rate, imply 15.5GW for Oklo and 34.7GW for NuScale by 2040, levels that are “44%/92% above each company’s base case forecast.”
BofA added that “on a combined basis, this totals ~50GW, or ~7% above the 47GW global unrisked SMR pipeline tracked by Wood Mackenzie.”
At current levels, Oklo trades at 16.9x/10.8x 2032/33E EV/EBITDA and NuScale at 11.9x/10.6x, with implied discount rates “well below our 14% sector assumption.”
Price objectives were revised to $117 for Oklo, up from $92, and to $34 for NuScale, down from $38.
“While we remain positive on the long-term nuclear theme, current valuations leave little room for error and the near-term risk/reward skews negative,” BofA said.
The bank also flagged execution and fuel risks. For Oklo, bulls point to “political backing and vertically integrated build-own-operate model,” but bears highlight capital intensity, fuel supply concerns, and questions over cost targets.
For NuScale, BofA cited concerns over supply chain costs, reliance on ENTRA1, and “credibility risk if no firm projects emerge.”
With short interest elevated in both stocks, BofA concluded that “cycle markers suggest the AI trade may be entering later stages.”
Democrats alarmed as Trump eyes weapons material to fuel nuclear reactors
The scramble to build new reactors to supply power to AI data centers may include plutonium from the nation’s nuclear deterrent.
An Air Force photo shows a test launch of an unarmed Minuteman III intercontinental ballistic missile in 2019 at Vandenberg Air Force Base in California. | Staff Sgt. J.T. Armstrong/U.S. Air Force via AP
The Trump administration is considering a proposal to divert plutonium that plays a central role in the U.S. nuclear weapons stockpile to fuel a new generation of power plants, according to an Energy Department official and previously undisclosed department documents.
The proposal calls for the department to alter the plutonium so it can be used by civilian power companies, including startups pitching advanced reactor designs. It’s part of a broader push by President Donald Trump to convert tons of the Energy Department’s plutonium to civilian use, a notion that some lawmakers argue would undermine the U.S. weapons program for the benefit of untested private companies.
The initiative would involve harvesting plutonium on a large scale: According to a department official and a July 31 DOE memo seen by POLITICO, more than a fifth of the plutonium needed to meet Trump’s mandates would come from the highly radioactive spheres manufactured for the cores of nuclear weapons. DOE already faces a crunch to make more of those spheres, known as plutonium pits — it’s lagging behind Congress’ demands that it boost pit production to modernize the country’s nuclear deterrence.
The department is “not meeting the current pit manufacturing schedule,” said a former DOE official who is familiar with the department’s plutonium reserves. “So to make pit plutonium available would be a huge shift, and I’d be shocked.”
Both the current and former officials were granted anonymity to share sensitive details about national security matters.
Trump didn’t mention the pits in a May executive order in which he directed DOE to draw from another source — its stores of surplus plutonium — to help revive the nuclear power industry and meet the soaring electricity demands of data centers used in artificial intelligence. The U.S. officially halted its program that made weapons-grade plutonium in 1992.
The department declined to confirm or deny any details of its plutonium plans in response to questions from POLITICO.
“The Department of Energy is evaluating a variety of strategies to build and strengthen domestic supply chains for nuclear fuel, including plutonium, as directed by President Trump’s Executive Orders,” the department said in a statement. “We have no announcements to share at this time.”
The White House referred POLITICO’s questions about the plutonium plans to DOE. The Defense Department referred questions to the White House.
Government watchdogs and congressional Democrats have spent weeks objecting to the entire notion of transferring government-owned plutonium to the power sector. Such a move “goes against long-standing, bipartisan U.S. nuclear security policy,” Democratic Sen. Ed Markey and Reps. Don Beyer and John Garamendi wrote in a Sept. 10 letter to Trump. “It raises serious weapons proliferation concerns, makes little economic sense, and may adversely affect the nation’s defense posture.”
In a separate Sept. 23 letter to Trump, Markey said he was concerned that Energy Secretary Chris Wright was pushing the plutonium proposals to help a Californian nuclear power startup named Oklo, on whose board Wright once sat.
DOE spokesperson Ben Dietderich said Wright has complied with ethics and financial disclosure requirements, divested assets and resigned from “board positions that may appear to present a conflict of interest.” He said Wright resigned from the Oklo board upon becoming DOE secretary, adding that Wright “has never and does not currently own any financial stake in Oklo.”
Oklo spokesperson Paul Day declined to comment on Markey’s concerns of a possible conflict of interest. He also declined to comment on how much plutonium the company intends or has agreed to acquire from DOE. He said DOE “has not, as far as we know, established a plutonium fuel program.”
One nuclear safety watchdog echoed many of the Democrats’ concerns in an interview, saying DOE’s proposal could hollow out the nation’s nuclear defenses and compromise the Pentagon’s long-term deterrence strategy. And it appears to be happening without coordination with the Defense Department, said Hans Kristensen, director of the nuclear information project at the Federation of American Scientists, a nonprofit group that focuses on global security.
“This is mainly a Department of Energy plan that is closely happening in collusion, essentially, with the nuclear power industry,” Kristensen said. “Some of the people that are involved in these recommendations are people that have very close ties to the nuclear power industry.”
DOE through its National Nuclear Security Administration is responsible for safeguarding the nuclear weapons supply and is the lead agency for detecting and stopping nuclear proliferation. The Defense Department manages the nuclear arsenal for strategic, military and defense purposes.
The hunt for plutonium
A July 31 DOE memo seen by POLITICO and prepared by Deputy Energy Secretary James Danly recommends delivering 25 metric tons of plutonium from U.S. government-held stockpiles to the nuclear power industry. More than one-fifth of that material would need to come from pits that the Defense Department relies upon for nuclear deterrence and national security, according to the current DOE official.
Reviving nuclear power is a central tenet of the Trump administration’s energy policy, driven in part by the need to generate rising amounts of electricity for artificial intelligence. Some tech companies are also eager to find carbon-free electricity sources, such as nuclear power, that meet their pledges for reducing greenhouse gas pollution.
U.S. civilian reactors now use only uranium for their nuclear fuel, but some reactors under development are planning to use plutonium. Spent plutonium from reactors is far more radioactive than uranium — and could pose a greater security risk than uranium if it were to fall into the hands of hostile nations or terrorist groups.
Several pilot programs for new kinds of nuclear reactors are underway, with hopes of achieving a sustained chain nuclear reaction next summer. One of Trump’s May orders called for revitalizing the nuclear power industry by supplying commercial power producers with reprocessed spent plutonium from DOE-managed stockpiles.
DOE has committed an initial 20 metric tons of plutonium for civilian use, Democrats noted in the Sept. 10 letter. But the internal July 31 memo showed the department has envisioned a larger goal.
The DOE memo called for delivering 18.5 metric tons of the government’s surplus plutonium and an additional 6.5 metric tons pulled from “material in classified form once it has been declassified.” That latter term, the current DOE official who spoke to POLITICO said, refers to the plutonium pits, whose shape and characteristics can reveal information about nuclear weapons.
The company where Wright was once a board member, Oklo, wants to take advantage of the plutonium fuel program. Unlike its competitors, Oklo’s fast-neutron reactors can use plutonium as a “bridge” fuel to get around the bottlenecks that exist in obtaining the more desirable grades of uranium, CEO Jacob DeWitte told POLITICO in an interview.
DeWitte said Oklo has not publicly revealed how much plutonium the company is seeking to run its new reactors, or from where precisely it plans to obtain that plutonium. He also said the Trump administration has not detailed exactly how much plutonium it will make available, noting that “there is disagreement” over how much surplus plutonium the federal government can hand off before harming nuclear deterrence.
“We’re waiting to see more, too,” he said. “It’s a worthwhile thing. But again, it depends on some details. And there’s going to be some details that we’re just not going to see.”
Adrienne Schweer, Oklo’s head of government relations, said she does not believe that the company’s history with Wright factored into Trump administration decisions, noting Wright has touted all sorts of nuclear power from his perch at DOE.
“Secretary Wright is really knowledgeable on nuclear and energy broadly,” she said in an interview. “I don’t imagine that he would ever play favorites. He’s not that kind of guy.”
Oklo is one of several companies that has pushed for more nuclear fuel supply, though it is one of the most public about its willingness and ability to use plutonium.
Oklo hired lobbying firm Holland & Knight in March to press on “nuclear and plutonium recyclability and access to feedstock,” among other issues. In January, it signed a memorandum of understanding with nuclear fuel developer Lightbridge Corp. to develop plutonium-based reactor fuel for its reactors. Oklo also inked a partnership in June with the Air Force to build a pilot reactor in Alaska that would use refined weapons-grade plutonium. “
Oklo official Ed Petit de Mange met with senior DOE officials, including Mark Senderling, on July 31, according to an internal DOE calendar obtained by POLITICO. The same day, the department partnered with the Nuclear Energy Institute and the United States Nuclear Industry Council for a “Fuel Industry Day” event at NEI’s Washington office to allow DOE “to engage directly with industry participants about potentially utilizing certain materials as a source of nuclear fuel,” according to a schedule of the event.
An Oklo official confirmed the company participated in the July 31 event. The Oklo official said its understanding was that the administration intended to commit only “surplus” plutonium for industry use.
“This is not interference with the weapons programs, at least from what I understand,” said the official, who was granted anonymity because they were not authorized to speak with the media. “This is the extra stuff that we were supposed to bury in the ground.”
‘No way to do that easily’
Congress has ordered DOE to produce 80 new pits annually by 2030 to modernize the nation’s weapons stockpile. For now, the Defense Department relies on 20,000 plutonium pits stored at DOE’s Pantex facility in Texas for its Minuteman III missiles.
The July 31 memo alluded to those needs in asking DOE to craft “a strategic plan to improve pit disassembly throughput without negatively impacting pit assembly.”
But new pits are slow coming. The Los Alamos National Laboratory, the nation’s only plutonium pit producer, made just one last year. A second facility, the Savannah River Site in South Carolina, is under construction but won’t be finished until 2032.
It takes several months to make each pit, which is then placed into larger warheads for modern Sentinel missiles. The Sentinel program is over budget and being restructured, so new missiles are not expected to be completed for years.
The DOE plans have drawn concern from congressional Democrats such as Markey, Garamendi and Beyer, who questioned the wisdom of giving away plutonium at the same time that the government is trying to replenish its pits.
“[W]e are concerned that your plan would give away plutonium that could otherwise help to maintain the nuclear arsenal,” they wrote in the Sept. 10 letter. “We should not disassemble existing pits that might reduce the need to produce new ones in the future.”
DOE has struggled to gather enough excess plutonium stored at sites around the country to meet Trump’s goals, according to a July 25 email obtained by POLITICO. The message revealed increasing urgency to deliver on its commitment to provide plutonium to the power industry that may conflict with national defense capabilities.
Danly asked DOE to tally up how much plutonium it oversees to develop a plan for shipping it to the industry, Chimi Zacot, a senior adviser for nuclear security at the department, wrote in the email to several officials there. The goal, Zacot said, was to figure out how much plutonium it could offer industry while maintaining an adequate stockpile for defense and national security.
Zacot wrote that Danly was displeased with how much plutonium the agency said it needed to withhold for the weapons stockpile. Zacot asked what the agency could do to expedite disassembly of plutonium pits to ship the material to industry.
Zacot did not respond to a request from POLITICO for comment.
Danly dialed up the pressure in an Aug. 11 memo to John Dupuy, director of DOE’s office of enterprise assessments, and Teresa Robbins of the department’s National Nuclear Security Administration. That memo called for evaluating the department leadership that oversees plutonium pits.
Despite the administration’s urgency, it would take years to break down pits and refine the plutonium for civilian use, said Stephen Young, associate director of government affairs at the Union of Concerned Scientists, a science watchdog group. DOE tried to convert weapons grade plutonium into commercial fuel at its Savannah River site before abandoning the project in 2018 due to costs.
“There’s no way to do that easily. Plutonium has to be put into fuel in a process that I don’t think they have figured out quite yet,” he said. “It’s not a near-term thing that’s going to happen.”
This article has been updated to correct the date that Oklo signed the MOU with Lightbridge and to correct the employer of the Energy Department’s Mark Senderling. It also clarifies that weapons-grade plutonium program was officially halted in 1992
Trump's Department of Energy expected to issue a 202c order any day now, which would afford him the power to order Xcel and other electric utility companies to continue burning coal in our communities indefinitely, undoing years and years of work in which many of us were instrumental. This would unfortunately allow him to order Comanche units 2 and probably 3 to remain operational.
Trump's Department of Energy expected to issue a 202c order any day now, which would afford him the power to order Xcel and other electric utility companies to continue burning coal in our communities indefinitely, undoing years and years of work in which many of us were instrumental. This would unfortunately allow him to order Comanche units 2 and probably 3 to remain operational.
Aquastar on Saturday recalled nearly 157,000 additional pounds of shrimp because of possible contamination with cesium 137, a radioactive isotope. The new recall includes nearly 50,000 bags of Kroger Raw Colossal EZ Peel Shrimp, about 18,000 bags of Kroger Mercado cooked medium peeled tail-off shrimp and more than 17,000 bags of AquaStar peeled tail-on shrimp skewers.
The products were sold between June 12 and Sept. 17 at grocery stores in more than 30 states. They include Bakers, City Market, Dillons, Food 4 Less, Foodsco, Fred Meyer, Fry's, Gerbes, Jay C, King Soopers, Kroger, Mariano's, Metro Market, Pay Less Supermarkets, Pick 'n Save, Ralph's, Smith's and QFC.
French utility EDF faces hurdles funding $542 billion nuclear plan, auditors say
FILE PHOTO: Cooling towers of the Golfech nuclear plant · Reuters
Forrest Crellin and Alban Kacher Wed, September 24, 2025 at 5:34 AM EDT 2 min read
By Forrest Crellin and Alban Kacher
PARIS (Reuters) -French utility EDF will need to invest some 460 billion euros ($542.39 billion) by 2040, mainly in its domestic nuclear fleet, but rising debt and cash flow issues pose major challenges, the French Court of Auditors said on Wednesday.
Nearly all of France's 57 nuclear reactors are over 30 years old and require extensive maintenance to continue operating, even as EDF plans to develop another six reactors over the next several decades.
"Everything related to ... preserving the competitiveness of the French economy, involves energy bills," Ines Mercereau, president of the Court of Auditors, said at a hearing in front of the National Assembly. About a fifth of the needed investments will have to go into keeping the existing nuclear fleet operational until they are 60 years old, costing about 5 billion euros to 6 billion euros per year, the Court of Auditors said in a report.
EDF did not immediately respond to a request for comment.
The utility is expected to finalise its plans for the new EPR2 reactors by the end of the year, allowing them to assess costs to make a final investment decision by the second half of 2026. The court estimates the total cost of the first six reactors at 75 billion euros.
EDF'S DEBT POSES A CHALLENGE TO FUND RAISING Investing in its electricity network subsidiary Enedis is expected to cost anther 100 billion euros, as the grid will need to be modernised and reinforced, the report said.
EDF is expected to have difficulties raising capital alone for these investments due to its debt, which ballooned in 2022 during the European energy crisis, and its cash flow trajectory, the report said.
The utility has faced difficulties implementing its new long-term contract scheme to replace the old system that contracted out about a third of its annual production as plummeting market prices have hurt EDF's ability to draw clients, the report said.
EDF refused to regulate the sale of its nuclear power in the past, so its income is now more than ever linked to falling market prices, said Nicolas Goldberg, partner at Colombus Consulting.
French prices for next year delivery were still above 100 euros per megawatt-hour when these new long-term contracts were announced in late 2023, but prices have dropped sharply since then to now under 60 euros/MWh, LSEG data showed.
To address these issues, the court urged the utility to continue to monitor profitability of its renewable investments and for a clear distribution of costs and risks between the French state, EDF and its customers.
"This will not, on its own, resolve the EDF group's debt situation," said Mercereau.
($1 = 0.8481 euros)
(Reporting by Forrest Crellin and Alban Kacher,Editing by Bernadette Baum and Ed Osmond)
A federal judge has sided with Holtec International in a dispute over a New York law that barred the discharge of radioactive materials into the Hudson River during the decommissioning of the Indian Point nuclear facility. The ruling underscores the primacy of federal oversight in nuclear safety decisions.
On Wednesday, U.S. District Judge Kenneth Karas held that a 2023 New York statute (commonly known as the “Save the Hudson” law) was preempted by federal law. The judge found that the state statute, which prohibits radioactive discharges in connection with decommissioning, “categorically precludes Holtec from utilizing a federally accepted method of disposal.”
Judge Karas reasoned that by requiring Holtec to alter how it disposes of tritiated (radioactive) water, the statute “directly and substantially affects decisions concerning radiological safety levels.” He also rejected New York’s argument that Holtec should have proposed alternative methods to comply with the discharge ban.
Holtec had filed suit to overturn the state law after Governor Kathy Hochul signed the bill in August 2023, making it illegal to discharge radiological substances into the Hudson River during decommissioning. In its filings, Holtec argued the law forced it to select an alternative disposal method even if discharge under NRC regulation would be safe, a requirement that would raise decommissioning costs and delay the project.
Holtec maintained that its plan to dispose of millions of gallons of treated, diluted tritiated water into the Hudson fully complied with Nuclear Regulatory Commission (NRC) licenses and federal standards. The company also warned that the state law might push the decommissioning timeline back to 2041, eight years beyond earlier targets.
In its defense, the New York Attorney General’s office, which had defended the state law, did not immediately respond to inquiries following the ruling. Earlier, the state alleged Holtec had, “during the fourth quarter of 2023 … discharged radiological substances into the Hudson River in connection with decommissioning” in violation of the law. Holtec countered that such discharges involved groundwater and stormwater not associated with decommissioning activity, which the statute does not cover.
Indian Point, whose reactors shut down in 2020 and 2021, lies in Buchanan, New York, about 45 miles north of Manhattan. The plant’s closure had long been controversial because of its proximity to the city and concerns over safety.
Holtec said it was pleased by the ruling and affirmed its intent to continue decommissioning in an “environmentally responsible” way while cooperating with federal, state, and local stakeholders.
You can feel the buzz: nuclear is back. Or so we’re told.
From Brussels to Washington, a new wave of enthusiasm for so-called Small Modular Reactors (SMRs) is sweeping through policy circles, think tanks, and energy startups. These compact, supposedly plug-and-play nuclear units are being hailed as the perfect solution to power data centers, feed artificial intelligence’s growing hunger, and backstop our energy transition with clean, stable electricity.
There’s just one problem. Actually, there are many. None of them small.
The hype cycle is in full spin
SMRs are currently being marketed like they're the iPhone of nuclear energy: smarter, smaller, cheaper, scalable. A miracle solution for everything from remote grids to decarbonizing heavy industry and AI’s server farms. Countries like the U.S., Canada, and the UK have announced ambitious deployment plans. Major developers, including NuScale, Rolls-Royce SMR, GE Hitachi, and TerraPower, have painted glossy timelines with glowing promises.
Except the fine print tells a different story.
There are currently no operational commercial SMRs anywhere in the world. Not one. NuScale, the U.S. frontrunner, recently cancelled its flagship Utah project after costs ballooned to over $9,000 per kilowatt and no investors could be found. Even their CEO admitted no deployment would happen before 2030. Meanwhile, Rolls-Royce’s much-hyped SMR factory hasn’t produced a single bolt of steel yet.
So, we’re betting on a technology that doesn’t yet exist at commercial scale, won’t arrive in meaningful numbers before the 2030s, and would require thousands of units to significantly contribute to global energy demand. That’s not a strategy. That’s science fiction.
Big nuclear hasn’t exactly inspired confidence either
Even the large-scale projects that SMRs claim to “improve upon” are struggling. Take the UK’s Hinkley Point C, once heralded as the future of nuclear energy in Europe. It’s now twice as expensive as originally planned (over £46 billion), at least five years late, and facing ongoing construction delays. The French-backed EPR reactor design it’s based on has already been plagued with similar issues in Flamanville (France) and Olkiluoto (Finland), where completion took over a decade longer than promised and costs ballooned dramatically.
Let’s be honest: if any other energy technology was this unreliable on delivery, we’d laugh it out of the room.
Price floors for nuclear, and price ceilings for reason
In France and Finland, authorities have now agreed to guaranteed minimum prices for new nuclear power, effectively writing blank checks to ensure profitability for operators. In Finland, the recent deal sets the floor above €90/MWh for 20 years. Meanwhile, solar and wind regularly clear wholesale power auctions across Europe at €30–50/MWh, with even lower marginal costs.
Why, exactly, are we locking in decades of higher prices for a supposedly “market-based” energy future? It’s hard to see how this helps consumers, industries, or climate targets. Especially when these same nuclear plants will also require major grid upgrades, just like renewables, because any large-scale generator needs robust transmission capacity. So no efficiency win there either.
The SMR promise: too small, too late
Back to SMRs. Let’s suppose the best-case scenario plays out. A couple of designs clear regulatory approval by 2027–2028, construction starts in the early 2030s, and the first commercial units are online before 2035. Even then, the world would need to build and connect thousands of these small reactors within 10–15 years to displace a meaningful share of fossil generation. That’s a logistics nightmare, and we haven’t even discussed public acceptance, licensing bottlenecks, uranium supply, or waste management.
For perspective: in the time it takes to build a single SMR, solar, wind, and battery storage could be deployed 10 to 20 times over, for less money, with shorter lead times, and with no radioactive legacy.
And unlike nuclear, these technologies are modular today. They’re scalable now. They’ve proven themselves everywhere from the Australian outback to German rooftops and Californian substations.
The elephant in the reactor room: waste and risk
Nuclear fans love to stress how “safe” modern designs are. And yes, statistically speaking, nuclear energy is relatively safe per kilowatt-hour. But it’s also the only energy source with a non-zero risk of catastrophic failure and waste that stays toxic for thousands of years.
Why, exactly, would we take that risk when we have multiple clean energy options with zero risk of explosion and waste streams that are either recyclable or inert?
You don’t need to be a nuclear physicist to ask this: how is betting on high-cost, slow-deploying, risk-bearing, politically toxic infrastructure a better idea than wind, solar, and storage?
A footnote in the transition, not the headline
Let’s be clear: nuclear power will likely continue to play a role in some countries’ energy mixes. France and Sweden have legacy fleets. New projects may go ahead in China or South Korea, where costs are contained and planning is centralized. But for the majority of the world, especially countries trying to decarbonize fast, new nuclear is not the answer.
SMRs, despite their branding, will not save the day. They will be at best a niche, possibly a small contributor in specific applications like remote mines, military bases, or industrial clusters where no other solution works. That’s fine. But let’s stop pretending they’re some kind of energy silver bullet.
Final thoughts
We are in the decisive decade for climate action. Every euro, dollar, and yuan we invest must yield maximum emissions reduction per unit of time and cost. By that standard, SMRs fall flat. Nuclear power, small or large, is simply too expensive, too slow, too risky, and too narrow in its use case to lead the energy transition.
So let’s cool the reactor hype. Let’s focus instead on the technologies that are already winning: wind, solar, batteries, heat pumps, grid flexibility, green hydrogen. These are not dreams. They’re deploying by the gigawatt, today. SMRs are fascinating, yes. But when it comes to decarbonization, we need workhorses, not unicorns.
Pennsylvania Gov. Josh Shapiro speaks in front of the Keystone Trade Center during a press conference on Aug. 7 in Falls Township, Pa.
PHILADELPHIA—Ninety-eight years ago, the nation’s largest power grid operator was founded here by utilities serving Pennsylvania and New Jersey. On Monday, Pennsylvania Gov. Josh Shapiro threatened to pull his state out of the coalition.
“It is time to get serious about making significant reform,” Shapiro said, at a conference he convened with representatives from all 13 states now in the grid to “chart a new course” for operator PJM Interconnection.
“If PJM refuses to change, we will be forced to go in a different direction,” he said.
Pennsylvania is the largest energy producer in the grid. Its absence would impact electricity consumers across the region, which stretches from Illinois to North Carolina.
Data centers built to fuel artificial intelligence technology are driving huge increases in electricity demand—and in prices for consumers. Shapiro and other elected leaders like Virginia Gov. Glenn Youngkin blame PJM for delays in approving new power projects, creating a bottleneck that is making the situation worse. Shapiro, a Democrat, and Youngkin, a Republican, want states to have a say in PJM’s decisions; right now, government officials do not have a voice on PJM’s board.
Speaking at the conference later in the day, PJM CEO Manu Asthana, who is stepping down at the end of this year, said that “fingerpointing” wasn’t helpful.
“There’s an element of responsibility on both sides,” he said, meaning the states and PJM. All parties need to work together and ask, “‘How do we solve this?’” he said.
At the end of the conference, 11 of the states’ governors’ offices—all but Kentucky and West Virginia—announced they had formed a collaborative to continue to work together on the energy issues discussed at the meeting.
Tom Rutigliano, senior advocate with the Natural Resources Defense Council, called the joint criticism of PJM by multiple state governors “very unusual” and “the highest level of state engagement with PJM I’ve ever seen.” He said in an email that he thinks there’s a strong chance for governance reforms.
Shapiro’s statements come two months after nine governors in the PJM region demanded in a letter that PJM reserve two board seats to be filled with nominees by the states. Last month, those nominees surfaced as former Federal Energy Regulatory Commission Chairman Mark Christie and former FERC Commissioner Allison Clements.
PJM, which has conducted a months-long effort with a consultant to propose candidates, initially responded that it would consider the recommendations. It is expected to make a decision this Thursday.
“PJM is mired in a crisis of confidence,” Christie said at the conference. “Consumers have lost confidence in the people who run their grid.”
Christie said PJM needs a “new constitution,” one that reimagines the organization in a way that changes its governance structure to reflect the fact that PJM is a “policy-making body.”
Shapiro said PJM has “months, not years” to make changes, or Pennsylvania will take steps to leave the organization. “We need to move more quickly on these energy-producing projects, and we’ve got to hold down costs. If PJM cannot do that, then Pennsylvania will look to go it alone,” he said. Shapiro did not provide details about what this new arrangement would look like.
New Jersey lawmakers have already taken up the issue. In June, the state Assembly passed a bill directing its Board of Public Utilities to work with other states and study alternatives for addressing skyrocketing electricity prices—including the option of leaving PJM altogether. A companion measure has been introduced in the state Senate but has not yet been assigned to a committee.
In remarks delivered remotely to the conference, Youngkin confirmed that he and his allies are working on bills that seek to do the same.
“The bottom line is that when PJM succeeds, we all succeed together. But if reforms stall, we will act and do what is needed to protect the families and businesses who depend on us,” Youngkin said.
In his recorded message for the conference attendees, Maryland Gov. Wes Moore said, “Thirteen governors have united with a single urgent message for our regional grid operator, and it underscores the seriousness of the crisis that we now face. The path forward requires real transparency and accountability from PJM and a truly collaborative role for states in the governance process.”
Maryland, as a net importer of electricity, is frustrated by PJM’s delays connecting new clean-energy sources to the grid and opaque governance rules that Moore repeatedly said are disrupting the state’s climate targets and hurting households and businesses.
On Monday, ahead of his recorded message, Moore huddled with state Senate leadership in Annapolis to announce $200 million in direct energy bill rebates for low-income households to counter the rising prices.
Without commenting on how PJM should be governed, the Natural Resources Defense Council said in a statement that PJM and states should require data center developers to “pull their own weight” by investing in new energy generation—a policy push during the meeting colloquially tagged as “bring your own generation” or B.Y.O.G.
“The big message today was that prices are unsustainably high and PJM needs to do a better job protecting customers,” Rutigliano said. “The truth is that this crisis was caused by data centers and nearly all the money is going to old power plants.”
In a statement to Inside Climate News, PJM spokesperson Dan Lockwood said that “meeting the demands of a rapidly changing energy landscape will require solutions that extend beyond any one institution.”
“It will require PJM, the industry and especially our states all working in concert,” he said.
Asthana, PJM’s CEO, emphasized the scale of change that will be necessary to meet the challenges of powering AI now and in the future, not just at PJM but across the country. “If we’re going to win this race, I think we need to think differently,” he said.
What’s not clear is whether, or how, states leaving PJM would lead to a more affordable or reliable system.
Most of the power plants in PJM compete on an open market as a result of decisions by lawmakers in various states in the 1990s and 2000s to introduce more competition into the electricity sector. This restructuring meant that regulated utilities were limited to providing the delivery of electricity, while independent power producers would build and operate power plants.
Representatives of independent power producers said on Monday that they can understand the frustration with PJM, but they don’t see how it solves anything for states to leave.
“While we continue to stand in favor of common-sense reforms that will improve power market functionality, grid reliability, and consumer affordability, the actions taken by some elected officials do nothing more than disrupt PJM’s ability to do its job,” said a statement from Todd Snitchler, president and CEO of the Electric Power Supply Association, a trade group whose members include independent power producers.
Jon Gordon, director at Advanced Energy United, a trade group that represents advanced generation technologies, said despite PJM’s high prices, participation within the regional grid provides more efficiency and competition for electricity sales, which keeps costs lower for ratepayers. The regime used prior to PJM’s shared marketplace allowed utilities to overbuild with less incentive to keep prices in check.
“I don’t think anybody wants to go back to that. … We just need to make improvements so we get all the benefits of competition but none of the inefficiencies,” Gordon said, adding that a PJM departure may mean state agencies could have to negotiate contracts with producers. “If these studies are fair and unbiased, I think they’re going to show it’s pretty risky to leave PJM and there’s probably not enough benefit to justify the potential risks.”
The challenge with PJM is the political diversity of the region that includes Republican West Virginia and Democratic New Jersey, compared to more ideologically homogeneous New England, Gordon added. The governors in the PJM region have now realized they don’t have much influence over decisions affecting how new generation sources get onto the grid.
“I think the states are completely different on whether it’s fossil or renewables generation,” Gordon said. “But they all agree that they want a voice, and they want lower prices.”
