FILE PHOTO: Pennsylvania Governor Josh Shapiro speaks at a ribbon cutting at the TGR Learning Lab Philadelphia in West Philadelphia, Pennsylvania, U.S., September 8, 2025. REUTERS/Rachel Wisniewski/File Photo

By Laila Kearney

NEW YORK (Reuters) -Governors of more than a quarter of U.S. states pushed on Monday for greater influence over PJM Interconnection, the country's biggest power grid, where electricity prices are surging as AI data center demand outpaces the connection of new supplies.

Rising power bills in PJM, which operates the grid covering 13 states and the District of Columbia, or one in five Americans, have led to a political backlash over the last year and threats by some governors to abandon the regional grid.

"This is a crisis of not having enough power," Virginia Governor Glenn Youngkin said. "This is a crisis in confidence."

Youngkin made his remarks at a gathering of governors in Philadelphia, where he called on PJM to re-open its process for nominating board members. Youngkin and other governors want their states to have more say in how PJM operates, inspired by models in the Midwest and New England.

The power grid, which holds the largest concentration of energy-intensive data centers in the world, is a member-run organization in which states do not have a vote. PJM is governed by a board of managers, and its voting members include transmission line owners and independent power plant operators.

Youngkin said PJM's electricity demand forecasts have been fundamentally wrong, undershooting the swell in demand for power from AI. One consequence of poor forecasting is missing out on economic growth, hurting job creation, he said.

Connecting new generation to the grid is taking too long, said David Rosner, chairman of the Federal Energy Regulatory Commission, adding that some studies on whether to connect a new power source to the grid take up to five years.

"That's unacceptable," Rosner told the conference of governors.

Ballooning prices in PJM have also been caused by the cost to produce and transport electricity and capacity payments, which are made to power plant operators to guarantee they run during periods of spiking demand to avoid blackouts.

Those payments, determined by annual energy auctions, have risen by about 1,000% over the last two auctions on the projected rise of data center demand coupled with largely stagnating power supply.

While states are not given a vote, they have wielded their power over PJM in other ways. Pennsylvania Governor Josh Shapiro led a successful push to put a price ceiling and floor on PJM's most recent capacity auction.

(Reporting by Laila Kearney and Tim McLaughlin; Editing by Chizu Nomiyama, Franklin Paul and Nia Williams)