PJM's Interim Resource Adequacy Service (IRAS) for Data Center Curtailment Faces IMM Rejection at FERC

The PJM Independent Market Monitor (IMM) filed an Answer to PJM's September 23rd Answer and to the Data Center Coalition's October 1 Answer in FERC Docket No. ER26-3515, urging rejection of PJM's August 13, 2026 Interim Resource Adequacy Service (IRAS) tariff filing. IRAS would let PJM prioritize curtailment of 'New Large Loads' (data centers) in zones where they have not brought their own new capacity (BYONC) or secured capacity via the Reliability Backstop Procurement (RBP). The IMM argues IRAS lacks locational constraints, uses inconsistent/gameable BYONC gating criteria, freezes ELCC values for up to 15 years while shifting ELCC risk to other customers, sets an unsupported and under-inclusive 50 MW/one-mile-radius 'Large Load' threshold, and improperly sequences curtailment of IRAS load after existing compensated Demand Resources rather than before them.

IRAS is PJM's core proposed mechanism for integrating rapidly growing data center load into its capacity market while protecting existing ratepayers, directly implementing the White House Ratepayer Protection Pledge and the National Energy Dominance Council's PJM Principles. If FERC rejects or substantially modifies IRAS, PJM will need to redesign curtailment, BYONC qualification, ELCC risk allocation, and large-load definition rules—reshaping how data center load interconnects with and is accredited in PJM's capacity market, with direct implications for cost allocation between data centers and native load, resource adequacy modeling, and reliability during shortage conditions.

This filing exposes several unresolved design tensions at the heart of adapting a mature locational capacity market (PJM's RPM/ELCC/CETO-CETL framework) to an unprecedented wave of concentrated, 8,760-hour data center load. The IMM's critique highlights that IRAS effectively decouples BYONC-contracted capacity from locational deliverability requirements (undermining the CETO/CETL local reliability construct that has underpinned PJM capacity pricing for two decades), permits previously-cleared capacity to be relabeled as 'new' (diluting net incremental capacity), and freezes ELCC accreditation for up to 15 years, converting accreditation risk into a socialized cost born by other ratepayers rather than the contracting parties. The proposed curtailment sequencing—placing data centers behind already-compensated Demand Resources—also inverts normal capacity-market logic where parties who have not procured capacity should bear first-order curtailment risk, raising first-principles questions about price formation integrity and whether curtailment 'service' definitions can substitute for actual capacity procurement. The jurisdictional dispute (federal vs. state responsibility for retail curtailment triggers) adds further complexity, drawing on EPSA and Hughes precedent, and signals that FERC's eventual order will likely need to draw sharp jurisdictional lines alongside design fixes. This is a bellwether case for how US RTOs handle large, controllable retail load integration into wholesale capacity markets.

Federal Power Act Sections 205/206; PJM Open Access Transmission Tariff (OATT); PJM Reliability Assurance Agreement (RAA); FERC Docket No. ER26-3515 (IRAS Filing) and related Docket No. ER26-3380 (RBP); White House Ratepayer Protection Pledge; National Energy Dominance Council Statement of Principles Regarding PJM

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