Exelon lowers high-probability data center load forecast by nearly 40%

Chicago utility company Exelon disclosed on Thursday that its "high-probability" data center load fell to approximately 11 gigawatts in the second quarter, down nearly 40% from 18 gigawatts at the end of last year. The company said this change is related to recent "Transmission Security Agreements" (TSAs) signed by its utility subsidiaries with potential data center customers. Such agreements include provisions designed to protect existing ratepayers from data center-related costs, covering credit obligations, committed revenue contributions, and deficiency payments.

"This update reflects that we are removing speculative projects and allows us to proactively gain insight into which demand is real," said Exelon Chief Financial Officer Jeanne Jones during an earnings call with stock analysts. As part of project screening, Exelon's Commonwealth Edison (ComEd) notified the Federal Energy Regulatory Commission (FERC) on July 24 that it had terminated a previously approved Transmission Security Agreement with PowerHouse Hillwood Holding. Key details of the project associated with that agreement had been redacted in ComEd's initial filing to FERC. However, Hillwood and PowerHouse Data Centers have been planning a 1.8-gigawatt, $20 billion data center project in Joliet, Illinois.

According to Jones, of the current high-probability projects—including approximately 9 gigawatts in northern Illinois, where ComEd operates, and about 2 gigawatts in mid-Atlantic states—roughly 4 gigawatts of data center load have signed Transmission Security Agreements, with $1 billion in collateral posted. Meanwhile, Exelon's data center interconnection pipeline (potential projects that utilities are studying or about to study) fell to about 25 gigawatts in the second quarter, down from approximately 43 gigawatts disclosed during the May earnings call.

Key data at a glance

• 17.6 gigawatt-hours:PECO Energy's electricity sales for the first half of 2026, down 0.7% year-over-year and down 2.1% on a weather-adjusted basis.
• 500 megawatts:The size of the battery storage project that Exelon's Atlantic City Electric plans to build and own in New Jersey.
• $12 billion to $17 billion:The amount of potential transmission projects not included in Exelon's nearly $42 billion four-year capital expenditure plan.
• $396 million:Second-quarter revenue, up approximately 1% from the same period last year.

Exelon continues to push for utility-owned generation assets as part of an "all-of-the-above" strategy to address capacity needs in the PJM Interconnection market. The PJM market covers 13 states in the mid-Atlantic and Midwest plus the District of Columbia. This summer's PJM capacity auction cleared at the price cap for the third consecutive time, fell short of the reliability target by 6.8 gigawatts, and attracted only 525 megawatts of new generation.

"Even at the highest allowed price, the market could not attract the level of new supply needed by the system," said Exelon President and CEO Calvin Butler on the earnings call. If PJM's current capacity auction price cap of $325 per megawatt-day is lifted as planned after the next auction in December, monthly bills for typical residential customers of Exelon's Atlantic City Electric in New Jersey could increase by $14.70 to $23.64. The utility made this statement to the New Jersey Board of Public Utilities (BPU) last week.

To address some of the challenges in PJM, Atlantic City Electric (ACE), in partnership with Invenergy, proposed on July 23 to build and own a 500-megawatt, four-hour battery energy storage system in Pittsgrove, New Jersey. According to ACE's filing with the BPU, the company plans to offer it into the PJM market after the project is expected to be operational by the end of 2030. The storage project is expected to help ACE meet growing peak demand and would not affect customer bills until at least 2035. ACE argues that owning the storage project does not violate New Jersey's electric restructuring law, which prohibits utilities from owning generation assets.

According to Jones, the project is expected to cost approximately $1 billion. ACE is seeking a 9.6% return on equity (ROE) in its filing, with the potential for a higher return if the project meets performance benchmarks. The utility said customers would receive $1.36 in benefits for every $1 spent on the project. If the BPU follows ACE's proposed timeline, a decision could come as early as February.

Jones also noted that Exelon's Baltimore Gas and Electric (BGE) and Potomac Electric Power Co. (Pepco) are advancing battery storage projects in Maryland. According to Exelon, the projects under review by the Maryland Public Service Commission total 150 megawatts. Butler said Exelon's utilities are also advancing energy efficiency programs and virtual power plants (VPPs). BGE and Pepco have been approved for nearly 175 megawatts of virtual power plant capacity in Maryland, and a Commonwealth Edison program is expected to take effect in March.