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How data centers are complicating transmission expansion
Brief
The episode centers on the Mid‑Atlantic Reliability Line (MARL), a roughly 107‑mile, ~$960 million high‑voltage transmission project developed by NextEra that would run from southwestern Pennsylvania through Maryland and West Virginia into northern Virginia. Guest reporter Mae Valsup (Latitude Media) walked host Shayle Kann through MARL’s arc: PJM approved the project in 2022 as a reliability solution to growing west‑to‑east capacity needs tied to Northern Virginia’s data centers, but state‑level siting and cost allocation issues only surfaced in earnest when NextEra began state filings in 2025 and spring 2026. Both agreed the project is now a focal point for larger questions about who pays for transmission when load growth is highly concentrated.
Their conversation traced how the AI and hyperscaler build‑out since late 2022 changed the political and regulatory landscape. Valsup explained that the FERC‑approved 2022 PJM cost allocation model spreads costs regionally (with larger shares to zones that benefit most), an approach states now challenge because concentrated data‑center growth skews benefits. Maryland took a prior challenge to FERC in 2024 and returned in May 2026 asking FERC to assign data‑center‑driven transmission costs directly to the beneficiary zone (e.g., Dominion/Virginia). Both hosts noted hyperscalers’ March 2026 White House “ratepayer protection” pledge is being invoked by consumer advocates as leverage to insist developers or large customers cover upgrades. The episode highlighted practical frictions: the socialized nature of transmission benefits, difficulties in negotiating pooled developer payments, timing mismatches (data centers want rapid power; MARL’s construction was eyed for 2029), and growing local pushback over costs, property and infrastructure impacts. Shayle emphasized the wider problem — U.S. transmission build rates have fallen from thousands of miles in peak years to only hundreds annually — and both warned MARL may be delayed or become a test case for FERC and PJM policy changes about cost allocation and large‑customer responsibility for grid upgrades.
Why it matters
Mae Valsup (Latitude Media) reported the Mid‑Atlantic Reliability Line (MARL) is a ~107‑mile, high‑voltage transmission project being developed by NextEra from southwestern Pennsylvania to northern Virginia (via Maryland and West Virginia) with an estimated cost of about $960 million.
Key details
- Shayle Kann noted PJM approved MARL in 2022 as a reliability project to address west‑to‑east capacity needs tied to growing Northern Virginia data‑center load, but NextEra only began state siting filings in 2025–spring 2026.
- Mae Valsup explained the core dispute is cost allocation: the FERC‑approved 2022 PJM cost model socializes costs regionally with a larger share to the benefiting zone, while states (led by Maryland) now ask FERC (May 2026 filing) to assign data‑center‑driven transmission costs to the specific zone (e.g., Dominion/Virginia).
- Mae Valsup and Shayle Kann highlighted evolving dynamics since 2022: the AI/data‑center boom after large language models (post‑Nov 2022) accelerated concentrated load growth and public scrutiny, and hyperscalers signed a White House 'ratepayer protection' pledge in March 2026 that state advocates cite to demand developers pay upgrades.
- Mae Valsup warned the project faces likely delays (public hearings underway in spring 2026, e.g., West Virginia) and a contested path to construction (NextEra has targeted a 2029 construction start, implying commercial operation several years later), while FERC is concurrently considering an ANOPR on making large customers cover 100% of grid upgrade costs.
- Shayle Kann contrasted historical and current build rates: about 4,000 miles of high‑voltage transmission were built in 2013 versus only hundreds per year in recent years, and the U.S. needs thousands — perhaps tens of thousands — of miles to keep pace with load growth driven by data centers and electrification.