PJM opens battery connection reform as US storage build hits record quarter

The change sounds technical. It is not. Surplus Interconnection Service (SIS) lets an existing plant add batteries. These batteries draw on the same grid connection when the plant is not generating at full tilt. The plant is usually a solar or wind farm. The Federal Energy Regulatory Commission has told grid operators to open the door to it, Canary Media reported on 29 October.

PJM is the biggest grid operator in the US. It covers 13 mid-Atlantic, Midwestern and Southern states. Its queue is congested, data centers are lining up for power, and capacity prices have risen sharply. On SIS, the operator has lagged behind its peers.

Jon Gordon is a senior director at the clean energy trade group Advanced Energy United. He told Canary Media that PJM's Market Implementation Committee will consider the next steps at its 4 November meeting. If a plan wins approval, PJM could finish the rule changes and ask FERC for permission to enact them as early as April 2027, according to the same report.

A 44 GW paper trail

The scale of what is waiting is visible in the private tracking. Gavin Ahern is co-founder of consultancy Surplus Interconnection. He told Canary Media his firm has counted 44 gigawatts of historical SIS project requests as of mid-2026. About 80% of them are proposals to add batteries to existing projects. NextEra Energy and Great River Energy have proposed batteries at North Dakota wind farms. Gas plants in California have been paired with batteries, and solar has been proposed at gas plants in Illinois, the report said.

That is the investment case in one line. A battery at an existing connection skips the longest part of the queue, and the connection already exists.

PJM's move lands in a record year for US storage. The country added 20.2 GWh of battery capacity in the second quarter of 2026, its biggest quarter ever. That figure comes from the Solar Energy Industries Association and Benchmark Mineral Intelligence, as reported by Electrek on 31 August. First-half installations reached 30.8 GWh, up 23% year over year.

Arizona alone added 6.2 GWh, the strongest quarter ever recorded by a single state. Texas added 3.8 GWh and California 3.6 GWh. Utility-scale projects made up about 18 GWh of the quarterly total. Of that capacity, 44% was paired with solar and 56% was standalone. More than 74% of the capacity installed in the quarter was in states Donald Trump won in 2024, the report found.

“This record growth highlights that storage is a powerful reliability tool that strengthens our energy security, meets rising demand, and puts downward pressure on electricity bills,” said Tim Pawlenty, president and CEO of SEIA, in the Electrek report. Shan Tomouk, BESS and Energy Lead at Benchmark Minerals, said in the same piece: “Energy storage is no longer just a California and Texas story anymore.” Benchmark raised its storage forecast through 2030 by 11.5%, to 683 GWh.

Co-location becomes the default

The co-location trend behind the SIS argument is measurable in federal data. As of September 2026, more than 16% of new utility-scale solar capacity added this year was co-located with operable battery storage. That compares with 2% in 2017. The figures come from data reported to the US Energy Information Administration by operators and published by CleanTechnica on 30 October. Planned additions for the last three months of the year put the share at 19%. Plans submitted for 2027 and 2028 push it above 30%.

The EIA data also shows where the practice is concentrated. Solar is 13% of total US utility-scale generating capacity, and 18% of that is co-located with batteries. In California, Arizona, New Mexico and Nevada the co-located share is more than double the national average, CleanTechnica reported.

Ember's October 2026 analysis puts a number on the alternative. Shifting computing workloads is the option data center operators talk about most. It could cut peak demand in Ireland by about 100 MW by 2030, or 1.5% of the projected peak. Most capacity is cloud, enterprise and inference work that cannot easily move. Under Ember's assumptions, only about 6.5% of global data center capacity could theoretically be shifted. That falls to roughly 3% once average utilization of about 48% is applied, pv magazine Global reported on 3 November.

Behind-the-meter generation and storage does better. Ember finds that approach could deliver nearly five times more grid relief, with potential reductions of up to 2.7 GW in Texas, according to pv magazine Global. Data centers already take about 19% of peak demand in Ireland. A 6 GW peak in January 2025 included an estimated 1.1 GW from data centers. Ember projects that share at 24% by 2030, with data center demand at 1.6 GW against a 6.5 GW peak.

The timing gap is the reason. A large data center needs 200 MW to 500 MW of capacity and can be built in 18 to 24 months. Conventional grid expansion takes four to 10 years, pv magazine Global reported.

The connection queue is not the only bottleneck

In the UK, National Grid has chosen a site near a planned AI data center on Teesside for its biggest substation, the Guardian reported on 1 November. The paper tied the decision to the power needs of the planned facility.

In China, the world's largest battery maker is pushing into businesses that sit closer to the grid. CATL has doubled down on battery swapping and energy storage. Price wars and tax changes cloud its earnings outlook, the South China Morning Post reported on 31 October. The paper quoted Lucas Zhang Liutong, director of Hong Kong consultancy WaterRock Energy Economics, saying competition in both sectors was “already quite intense”.

The swapping network that CATL would be competing with keeps growing. Nio said it passed 130 million cumulative battery swaps at 6:53:21 pm Beijing time on 3 November. That came 88 days after passing 120 million on 7 August, CnEVPost reported. Daily swaps averaged more than 110,000 over those 88 days. Nio had 4,236 swap stations in China on 3 November, up by 230 from 4,006 on 7 August. Of its users, 84.5% had a station within 3 kilometers of home or work.

Upstream, the market is still concentrated. CATL held 39.1% of the global EV battery market in January to September 2026 and BYD held 15.2%, CnEVPost reported on 2 November.

Investment is moving in the same direction. Xiaomi plans to invest about $253 million for a 5.34% stake in Sunwoda Electric Vehicle Battery, becoming its third-largest shareholder. That is according to a filing reported by CnEVPost on 30 October. Sunwoda will lose control of the unit. It expects the deconsolidation to add 3.2 billion to 4.5 billion yuan to its 2026 net profit, subject to audit.

Two caveats sit under the storage boom. Residential storage is not sharing in it. US homes added 657 MWh in the second quarter, down 27% year over year. SEIA and Benchmark attribute this partly to the removal of the federal 25D residential clean energy tax credit. They also cite homeowners pulling installations into 2025, Electrek reported.

And the physical footprint of grid batteries keeps raising questions. Forschungszentrum Jülich said on 1 November that a team led by Dirk Witthaut had traced a brief dip in European grid frequency every 60 seconds. The cause was large battery storage systems checking their state of charge on the minute. The finding was published in Nature Energy. “It really was years of detective work,” Witthaut said in the release.

PJM's stakeholder process will show how much of the queue problem can be solved by rewiring what already exists. The 4 November meeting is the first date to watch.