Due to a severe cold wave in the eastern United States, electricity prices in Virginia, home to the world's largest data center, have risen ninefold, possibly due to high power demand at data centers.
The extremely cold weather in the eastern United States has led to increased demand for heating and a tightening of natural gas supplies, causing power plant shutdowns across the country. Even in Virginia, home to the world's largest data center cluster, electricity prices have risen ninefold.
Power plant outages surge in Eastern US amid restricted gas supplies and frigid weather | Reuters
A winter storm named 'Fern' struck the eastern United States over the weekend of January 24-25, 2026. According to a CBS News report, 11,000 flights were canceled on Sunday, the highest number of cancellations in a single day since the mass cancellations at the start of the COVID-19 pandemic. Areas of the eastern United States, including Washington, D.C., experienced heavy snowfall, icy roads, and significant drops in temperature.
PJM Interconnection, the largest regional power grid in the United States, serving 67 million people in the eastern and mid-Atlantic regions, reported approximately 21 gigawatts of power generation outages due to tight natural gas supplies and increased heating demand caused by heavy snow, and reduced power generation at power plants due to the extreme cold. PJM has mandated that customers participating in some power curtailment programs reduce their power usage to mitigate increased demand in affected areas, and has asked power generator operators to conserve operating hours in preparation for future weather and increased power demand.
As demand for electricity increased and supply decreased, the spot price, which is the real-time wholesale electricity price in New York and New England, soared from $400 (approximately 60,000 yen) to $700 (approximately 110,000 yen) per MWh on the afternoon of January 25, 2026.
Furthermore, in Virginia, home to the world's largest data center cluster, the spot price rose to $1,800 (approximately 270,000 yen) per MWh in the early morning of January 25, 2026, from $200 (approximately 30,000 yen) per MWh the previous morning due to high electricity demand from data centers. In a report submitted in December 2024, the North American Electric Reliability Council (NERC) stated, 'The decommissioning of power plants and the massive consumption of electricity by newly built data centers are increasing the risk of energy shortages in more than half of the Americas over the next five to 10 years,' warning of a tight power supply due to the impact of data centers.
AI is increasing the risk of power outages, and surges in demand from data centers are putting a strain on the power grid - GIGAZINE
Similar electricity price increases were occurring across the United States, with more than 300,000 customers affected in Tennessee and more than 100,000 customers each in Mississippi, Texas, and Louisiana, with nearly 1 million people reportedly without power in one day.
PJM forecasts that electricity demand will rise to 147.2 gigawatts in the coming years, surpassing the previous winter electricity demand record of 143.7 gigawatts set in January 2025.
'The East Coast does not have its own natural gas supply, so it relies on a pipeline network, which historically has been limited during severe cold spells,' said Peter Mull, a power grid expert in the Energy and Utilities Industry. 'This has led to supply shortages, resulting in power outages and spikes in electricity prices. PJM's power outages are more frequent than the grid planned. This is because the PJM system is less flexible than it was a few years ago, due to power plant closures and a surge in power demand from data centers.'
Related Posts:
in AI, Posted by log1e_dh