Dirty by Design- Subordinating Human Health to Data Centers

After the December  2025, power auction results confirmed a 6,623 MW shortfall in the reliability target, PJM and Virginia regulators are pivoting toward a strategy that treats data centers not just as consumers, but as a "distributed power plant" of last resort.

Here is the breakdown of how this "backup generator" strategy is being formalized between PJM, Dominion Energy, and the Virginia Department of Environmental Quality (DEQ).

The DEQ "Emergency" Redefinition

The Virginia DEQ issued a critical guidance memo (APG-578) in late 2025 that effectively opens the door for this strategy.

• The "Planned Outage" Loophole: Historically, data centers were only allowed to run their diesel generators during "sudden and unforeseeable" emergencies. The DEQ has now expanded this to include "planned outages" or "grid stress events" scheduled by the utility with 14 days' notice or less.
• Consent and Compliance: By redefining these as "emergencies," DEQ allows data centers to bypass certain air quality restrictions that usually prevent them from running Tier II (dirtier) diesel engines for non-emergency power.

"Demand Response" vs. "Interruptible Service"

PJM is currently finalizing a "Large Load" proposal for FERC that would fundamentally change how data centers in the Dominion Zone connect to the grid:

• Interruptible by Default: New data center interconnections are increasingly being offered "interruptible" status. This means they are allowed to connect to the grid only if they agree to drop their load (switch to backup generators) when the grid hits 95% capacity.
• The Reliability Gap: The 6,623 MW auction shortfall essentially becomes a "paper gap" if PJM can count on data centers to voluntarily remove themselves from the grid during peak winter or summer events.

The Environmental Trade-off

This strategy has sparked a fierce debate in Northern Virginia (Loudoun and Prince William Counties):

• Localized Pollution: A study from Virginia’s legislative research arm (JLARC) warned that if the thousands of data center generators in "Data Center Alley" all turned on at once, they could release 9,000 tons of nitrogen oxides—roughly half of the total annual emissions for all sources in Northern Virginia.
• Noise and Health: Residents are concerned that "grid stress" events (like a 3-day cold snap) could result in thousands of diesel engines running for 72 hours straight in residential corridors.

Why this matters for the 2027/2028 Planning Year

Because the December 2025 auction failed to secure enough "firm" power (coal, gas, or nuclear) to meet the 20% reserve margin, the grid will enter the 2027/2028 year with only a 14.8% margin.

To bridge that 5% gap, PJM is betting on:

1. The DEQ Policy: Ensuring data centers can legally run their backups.
2. Dominion’s New GS-5 Rate Class: A new rate category for 25MW+ customers that incentivizes them to move their own power generation on-site (BYOC - "Bring Your Own Capacity").

While this keeps the "lights on" for residents, it effectively turns Northern Virginia into a de facto diesel power plant whenever it gets too cold or too hot, bypassing the spirit of the Virginia Clean Economy Act (VCEA) which sought to eliminate carbon emissions.

The Virginia DEQ recently acknowledged that they have never performed a cumulative modeling exercise for these clusters. Under the new DEQ guidance, if PJM declares a "Grid Stress Event" (such as a 48-hour cold snap), the "generator zones" in Ashburn and Gainesville would effectively become the primary power source for the data centers. This would mean thousands of diesel engines running simultaneously in close proximity to schools and homes, potentially releasing half of the region's annual Nitrogen Oxide (NOx) budget in just a few days.