Gov Shapiro Secures Federal Support to Extend PJM Price Cap | Commonwealth of Pennsylvania

Washington, D.C. - Today, Governor Josh Shapiro signed a Statement of Principles alongside a bipartisan group of governors, U.S. Secretary of Energy Chris Wright, and U.S. Secretary of the Interior Doug Burgum to advance a coordinated plan to reform PJM Interconnection, accelerate the construction of new energy generation, and protect families and businesses from rising electricity costs. The Statement of Principles builds on years of leadership by Governor Shapiro, who has been advocating for reforms to PJM since early in his term, took legal action when PJM failed to act, and secured real consumer protections that are now shaping the national response.

The group of bipartisan officials is pushing PJM to adopt rules that would get more power on the grid as quickly as possible - without passing new costs onto consumers who are already struggling with higher grocery, housing, and energy bills. The principles provide consumers critical protection by extending for two more years the price cap that Governor Shapiro won after he sued PJM in 2024 to stop unjustified price hikes. The Governor made clear that his involvement today was contingent on extending the price cap he negotiated following his lawsuit - ensuring consumer protections remained at the center of all discussions.

If implemented as proposed, the extended price cap would save more than 67 million consumers - including 13 million Pennsylvanians - within the PJM region approximately $27 billion over the next two years with $5 billion in Pennsylvania alone. These savings would be in addition to $18.2 billion already saved as a direct result of Governor Shapiro's 2024 lawsuit.

Secretary Wright, Secretary Burgum, Virginia Governor Glenn Youngkin, Maryland Governor Wes Moore, and Ohio Governor Mike DeWine signed the Statement of Principles at the event. In total, all 13 governors from PJM states have signed onto the Principles, underscoring broad bipartisan support for extending the price cap and advancing PJM reform.

"For two years, I've been sounding the alarm, explaining that without fundamental changes to PJM - Pennsylvanians were going to be paying more and more, and getting nothing in return," said Governor Shapiro. "I sued PJM when they refused to act and secured a price cap that saved consumers tens of billions of dollars on their energy bills. Since then I've been working with my fellow governors and federal energy officials to push PJM to make needed reforms, and I'm glad the White House is following Pennsylvania's lead and adopting the solutions we've been pushing for - including the extension of the price cap that I insisted be included today. In Pennsylvania, we've been focused on creating more energy, permitting faster, and protecting consumers - we're showing what's possible when government leads the way and gets stuff done."

Today's agreement comes as the PJM Board is considering revised rules for the upcoming 2028-29 Capacity Auction, to be held in June. Governor Shapiro called on the PJM Board to immediately adopt the Statement of Principles for the upcoming auction to ensure that consumers are protected from further energy price spikes.

The Statement of Principles being advanced would require PJM to:

• Trigger a special "backstop" capacity auction offering generators up to 15-year commitments to accelerate the construction of new power plants

• Allocate the cost of those long-term contracts to data centers and new large users that have not brought their own power - instead of shifting those costs onto households and small businesses

• Significantly accelerate PJM's interconnection process, including a firm 150-day deadline and expedited treatment for shovel-ready projects

• Launch a new PJM process to deliver long-term market reforms while extending Governor Shapiro's negotiated price cap for the next two auctions

Together, these reforms are designed to lower costs, strengthen reliability, and finally fix PJM's broken process - allowing economic growth and data center development to continue without burdening ratepayers.

Even before today, Pennsylvania was leading the nation on energy. The Commonwealth is the second-largest energy producer in the country and the second-largest net exporter of energy, behind only Texas. Under Governor Shapiro's leadership, Pennsylvania is producing more energy than ever before - including restarting operations at Unit 1 on Three Mile Island, converting former coal-fired power plants into modern natural gas facilities, and adding approximately five gigawatts of new generation to the regional grid.

At the same time, Governor Shapiro has prioritized making government move faster. Through his Lightning Plan, the Governor is working with the General Assembly to streamline permitting, cut red tape, and connect new energy projects to the grid more quickly - a model that complements and reinforces the PJM reforms being advanced today.

Governor Shapiro's Proven Track Record of Success Taking on PJM and Protecting Consumers

For years, Governor Shapiro has led the fight to stop rising electricity costs from being passed on to consumers and to get more energy onto the grid faster. Long before today, Governor Shapiro identified PJM's failures, demanded action, and took decisive steps when PJM refused to act.

Throughout 2024, Governor Shapiro repeatedly urged PJM to speed up approvals, cut red tape, and modernize its rules to better reflect real-world energy needs - calling on PJM to improve reliability during extreme weather, reform its capacity market to lower costs, accelerate stalled interconnection queues, and support shovel-ready projects. When PJM continued to delay new generation while driving up prices, Governor Shapiro escalated his efforts.

In December 2024, with electricity prices poised to spike, Governor Shapiro sued PJM, warning that PJM's flawed auction design would saddle consumers with billions in unnecessary costs.

That legal action led to a landmark agreement in January 2025, later approved by the Federal Energy Regulatory Commission (FERC), that dramatically lowered PJM's capacity price cap and saved consumers billions. PJM's first auction under the Shapiro settlement rules in July 2025 confirmed the impact - reducing costs by $8.3 billion compared to what consumers would have paid without the Governor's intervention. A second auction held in December 2025 again demonstrated the power of those reforms, averting an unprecedented and unwarranted spike in energy prices and saving consumers $9.9 billion. In total, Governor Shapiro's actions have already saved consumers more than $18.2 billion - with additional savings ahead if today's reforms are adopted.

Beyond litigation, Governor Shapiro has built and led a bipartisan coalition to deliver lasting reform. In September 2025, he convened all 13 PJM governors in Philadelphia for the first-ever Summit on the State of PJM Interconnection, bringing together state leaders, regulators, consumer advocates, and industry to chart a new path forward. That effort resulted in the creation of the PJM Governors Collaborative - the first formal bipartisan forum ensuring governors representing more than 67 million people have a collective voice in PJM decisions that affect household energy bills and grid reliability.

At the same time, Governor Shapiro has paired PJM reform with action in Pennsylvania. Through his Lightning Plan, he is cutting permitting delays, speeding interconnections, and positioning Pennsylvania - the nation's second-largest energy producer and exporter - to build more power faster while keeping costs down. In November 2025, the Governor also signed the Electricity Load Forecast Accountability provisions into law as part of the 2025-26 budget, giving the Pennsylvania Public Utility Commission new authority to review and validate the load forecasts utilities submit to PJM - increasing transparency, preventing double-counting of new large energy users like data centers, and protecting consumers from unnecessary price hikes driven by inaccurate data. Independent analyses confirm these efforts will save consumers money, create jobs, and attract billions in new energy investment.

Governor Shapiro didn't just warn about PJM's failures - he forced change, built bipartisan momentum, and delivered real savings for families and businesses. That leadership continues to shape today's national response and remains central to the push for deeper, lasting PJM reform.