How PJM's Interconnection Reforms Are Reshaping the Grid and What It Means for Engineering Services

PJM (PJM Interconnection LLC) is the regional transmission organization managing the electricity grid across 13 states and Washington D.C. Its interconnection process is the formal pathway by which new generation resources — power plants, solar farms, battery storage, wind farms, and hybrid facilities — receive approval to physically connect to the high-voltage transmission network and supply power to the grid.

For any new generation project within PJM's territory, completing the interconnection process is not optional — it is a legal and technical prerequisite for commercial operation. The process determines how the new resource will connect, what grid upgrades (if any) it must fund, and what capacity and energy delivery rights it will hold. At Keentel Engineering Services, navigating this process is a foundational service we provide to developers, utilities, and independent power producers.

PJM has transitioned from a first-come, first-served model  which allowed speculative developers to fill the queue regardless of project viability — to a first-ready, first-served Cycle-based model. Under the new rules, developers must demonstrate readiness by meeting progressive milestones to remain in the study process. Projects that cannot prove viability at each stage are removed from the queue.

This change has fundamentally improved the efficiency of PJM's study process. The speculative projects that previously consumed study resources and delayed ready-to-build projects are now filtered out early. The result is a queue that better reflects actual investment intent and gives serious developers higher confidence in their timeline projections.

Keentel Engineering Services helped clients prepare for these reforms and continues to guide developers through the new Cycle submission requirements and milestone obligations.

The new Cycle process is PJM's reformed framework for accepting, studying, and processing interconnection applications in defined cohorts rather than on a continuous rolling basis. Applications are submitted during a defined window, studied together as a cluster, and processed with a target turnaround of one to two years depending on the complexity of each project's grid impact.

The most recent submission window closed on April 27, 2026, with all applications received by that deadline forming the first full Cycle cohort under the reformed rules. PJM has confirmed that all generation projects seeking interconnection will be in active process following that deadline, effectively eliminating the legacy backlog.

For developers, the Cycle model provides clearer timelines and reduces the uncertainty that plagued the old rolling queue. Keentel Engineering Services assists clients in preparing strong Cycle submissions that satisfy PJM's technical and commercial readiness requirements.

Between 2020 and 2026, PJM studied 294 GW worth of projects to deliver interconnection agreements for 103 GW  yet 74% of all studied projects ultimately withdrew, including 26 GW of projects that had already signed interconnection agreements. The withdrawals largely reflected the speculative nature of submissions under the old first-come, first-served system, where the low cost of filing an application incentivized developers to reserve queue positions without genuine project commitments.

For today's developers, this history has two important implications:

• The old queue's inefficiencies inflated cost estimates and delayed legitimate projects a problem the new reforms directly address.
• The new Cycle rules impose real financial and technical milestones that weed out speculative entries, meaning developers who enter the queue now are competing against more serious, better-prepared counterparts.

Keentel Engineering Services prepares clients to meet these milestones from day one, reducing the risk of costly withdrawals.

A Capacity Interconnection Right (CIR) is the right held by a generating unit to inject a specific amount of electrical capacity into the grid at a particular point on the transmission system. CIRs are acquired through the interconnection process and are essential for a generator to participate in PJM's capacity market (the Reliability Pricing Model) and receive capacity payments.

A CIR Transfer is the new streamlined process that allows a retiring generator to transfer its CIR to a replacement resource at the same site. FERC affirmed this mechanism in its January 29, 2026 order, noting that it 'promotes the efficient use of existing infrastructure.' This is particularly valuable for repowering projects — replacing aging fossil fuel plants with new renewable or storage resources at the same grid connection point.

Keentel Engineering Services specializes in structuring CIR transfer applications, ensuring that the technical documentation and study submissions satisfy both PJM's engineering requirements and FERC's regulatory standards.

Surplus Interconnection Service allows the unused portion of an existing interconnection service allocation at a generation facility to be used by additional resources at the same site. The most common application is adding battery storage to a solar or wind facility that does not operate at full capacity every hour of every day.

For example, a 100 MW solar facility that has a 100 MW interconnection agreement but only generates at full output for a fraction of the day has 'surplus' interconnection capacity during off-peak generation hours. Battery storage co-located at that site can utilize that surplus capacity to charge and discharge without requiring a new interconnection application for the full battery capacity.

Developers should consider Surplus Interconnection Service when:

• Adding energy storage to an existing or permitted renewable site
• Optimizing the use of an existing transmission connection
• Seeking to avoid the cost and timeline of a full new interconnection application

Keentel Engineering Services provides engineering analysis to determine the available surplus, prepare the required study submissions, and coordinate with PJM on the approval process.

Provisional Interconnection Service allows a new generator to begin operating and injecting energy into the grid before all required network upgrades associated with its interconnection agreement are completed. To qualify, the generator must pass an interim deliverability study confirming that its operation does not cause transmission violations in the absence of the full upgrade package.

PJM is expanding Provisional Interconnection Service availability to generators that do not yet qualify for Capacity Interconnection Rights — meaning that even projects earlier in the upgrade queue can potentially begin generating revenue while waiting for long-term system improvements.

The financial impact can be substantial. A project that achieves commercial operation two to three years before its full network upgrades are complete can generate significant energy revenue and reduce overall project payback periods. Keentel Engineering Services evaluates each client's project for Provisional Service eligibility and prepares the technical documentation required for the interim deliverability study.

This is one of the most consequential findings in PJM's March 2026 update: 54 GW of generation has completed PJM's interconnection process, has signed interconnection agreements, and requires nothing further from PJM to proceed to construction — yet much of it has not been built. Developers consistently identify permitting as their greatest obstacle.

Permitting encompasses a wide range of approvals:

• Federal environmental reviews (NEPA, Endangered Species Act consultations)
• State siting and certificate approvals
• Local zoning and land-use permits
• Air quality permits for thermal generation
• Water withdrawal and discharge permits
• Transmission line easements and rights-of-way

The permitting timeline is often longer and less predictable than the interconnection study timeline itself. Some states have enacted legislation to streamline energy project permitting; others have not. Keentel Engineering Services provides permitting coordination services that run parallel to the interconnection process, positioning clients to begin construction as quickly as possible once their interconnection agreement is signed.

The Expedited Interconnection Track is a two-year interim program filed with FERC on February 27, 2026, designed to provide a faster path to interconnection for large, advanced projects of 250 MW accredited capacity or greater. A maximum of ten projects per calendar year will be selected for this track.

Projects that qualify must demonstrate an advanced level of readiness — including site control, permitting progress, and financial commitment — that distinguishes them from projects still in early development. The track is designed to address the grid's most urgent near-term capacity needs without displacing the broader queue of smaller projects.

For developers with large, near-shovel-ready projects, the Expedited Track represents a meaningful opportunity to compress the interconnection timeline. Keentel Engineering Services assists clients in evaluating whether their projects meet the qualification criteria and in preparing the competitive submission required for selection.

The Reliability Resource Initiative (RRI) is a one-time, targeted initiative in which PJM identified 41 specific projects representing approximately 8,000 MW of generation for accelerated interconnection study completion by the end of 2026. These projects were selected based on their potential to address near-term grid reliability concerns in PJM's service territory.

The RRI represents PJM's recognition that the normal study queue, even under the reformed Cycle process, could not move fast enough to address the immediate reliability challenges posed by accelerating demand growth and planned generator retirements. By fast-tracking this specific cohort, PJM aims to add meaningful capacity to the grid on a compressed schedule.

Projects included in the RRI span multiple technologies and locations across PJM's 13-state territory. While the RRI enrollment window has closed, understanding its mechanics is relevant for future initiatives that PJM or FERC may pursue as grid stress continues to mount.

Data centers and artificial intelligence computing facilities are among the fastest-growing sources of electricity demand in the United States, and PJM's service territory which includes major data center corridors in Virginia, Ohio, and other states — is at the epicenter of this trend. PJM's planning analyses project that demand growth will significantly exceed historical rates, with large new loads from hyperscale data facilities, semiconductor manufacturing, and EV charging infrastructure contributing to the imbalance.

This demand surge affects the interconnection queue in several ways:

• It increases the urgency of connecting new generation resources, driving both the reform agenda and the interim initiatives described in PJM's March 2026 update.
• It adds large new load interconnection requests to PJM's queue alongside generation projects, requiring transmission upgrades that affect generation interconnection costs.
• It creates competitive pressure on queue positions and study resources.

Keentel Engineering Services works with both generation developers and large electricity consumers to navigate this increasingly complex interconnection environment, including providing load interconnection support for large industrial and data center clients.

Under the reformed Cycle model, PJM has committed to a study turnaround of between one and two years for projects in each Cycle, depending on the complexity of the project's grid impact. Projects with minimal transmission impacts common for storage additions and projects near existing high-voltage infrastructure will generally fall toward the shorter end of this range. Projects requiring significant network upgrades will take longer.

This represents a substantial improvement over the old queue, where study timelines routinely stretched to five years or more due to the volume of speculative projects clogging the system. FERC has fully approved PJM's new timeline commitments, providing regulatory certainty.

Developers should note that the interconnection study timeline is only one component of the overall project development schedule. Permitting, financing, equipment procurement, and construction each add additional time. Keentel Engineering Services helps clients develop integrated project schedules that account for all phases and identify opportunities to run permitting and financing in parallel with the PJM study process.

FERC is the federal regulatory authority with jurisdiction over wholesale electricity markets and transmission in the United States. All of PJM's interconnection rules including the new Cycle process, the Expedited Interconnection Track, Surplus Interconnection Service, and CIR Transfer  require FERC approval before taking effect.

FERC has been an active driver of interconnection reform, issuing Order 2023 (and subsequent orders) mandating that all regional transmission organizations implement a more efficient, cluster-based interconnection process similar to what PJM has adopted. FERC's January 29, 2026 order affirming CIR Transfers and its review of the Expedited Interconnection Track filing reflect the agency's continued engagement in accelerating generation development.

Understanding the FERC regulatory layer is essential for developers, as FERC filings, protests, and orders can affect project timelines and cost allocations. Keentel Engineering Services monitors FERC regulatory developments and provides clients with timely analysis of how new orders affect their interconnection strategy.

Transmission owners (TOs) are the utilities and companies that own and operate the high-voltage transmission infrastructure within PJM's service territory. TOs play a critical role in the interconnection process because they are responsible for conducting the engineering studies that determine how a new generator affects the grid and what upgrades are needed.

When PJM reformed its interconnection process, it did so with direct coordination and cooperation from transmission owners — a point specifically noted in PJM's March 2026 update. TOs must review feasibility and system impact studies, design the required network upgrades, and ultimately execute the construction of those upgrades under the interconnection agreement.

Delays at the transmission owner level — whether due to resource constraints, competing upgrade priorities, or engineering complexity — can affect project timelines even when the developer is fully ready to proceed. Keentel Engineering Services maintains working relationships with engineering teams across PJM's transmission owner community and helps clients proactively identify and address potential TO-level delays.

PJM's March 2026 update highlights an active collaboration with Google and Tapestry to develop and test an AI tool called HyperQ, which is designed to streamline specific phases of the interconnection study process particularly the evaluation of New Service Requests. Early results indicate meaningful time savings in these evaluation components.

This development reflects a broader industry trend toward applying machine learning and AI to power system analysis, where large volumes of data and repetitive computational tasks are well-suited to automation. The potential benefits include:

• Faster initial screening of generator interconnection applications
• More consistent application of study criteria across large volumes of requests
• Earlier identification of technical issues that would require network upgrades
• Reduced manual review burden on PJM and transmission owner engineers

Keentel Engineering Services actively monitors AI developments in power systems engineering and incorporates advanced modeling tools into our workflow where validated and appropriate — ensuring our clients benefit from the same efficiency gains that PJM is pursuing at the RTO level.

Before submitting a formal interconnection application, developers should complete a thorough pre-application assessment that covers four areas:

• Preliminary grid screening: Identify the nearest available points of interconnection, review PJM's publicly available transmission maps and generation interconnection data, and obtain a preliminary sense of expected network upgrade costs. Keentel Engineering Services conducts these screening studies using PJM's open-access transmission data.
• Site selection and control: Secure site control (ownership or option agreement) before submitting an application, as most Cycle processes require demonstrated site control to satisfy readiness milestones.
• Permitting landscape assessment: Understand the federal, state, and local permitting requirements for the project location and technology type. Early engagement with permitting agencies can significantly shorten approval timelines.
• Financial readiness: Assess the capital structure and financing strategy for the project, including the potential cost of required network upgrades, which can range from negligible to hundreds of millions of dollars depending on the project location.

Keentel Engineering Services offers pre-application feasibility studies that address all four of these dimensions, giving clients a clear-eyed view of project viability before committing to formal application costs.

PJM has explicitly confirmed that the interim initiatives — the Expedited Interconnection Track and the Reliability Resource Initiative — will not displace smaller renewable and storage projects from the study queue. Of the 30 GW scheduled for interconnection study completion by end of 2026, 25 GW consists of smaller renewable and storage projects. Only the remaining 5 GW is associated with the large-project interim initiatives.

Furthermore, PJM anticipates that solar, wind, battery storage, and hybrid projects will be strongly represented in the new Cycle 1 cohort following the April 2026 application window close. The long-term interconnection pipeline continues to be dominated by clean energy technologies, reflecting both the economics of renewable development and the policy priorities of PJM's 13-state service territory.

Keentel Engineering Services supports projects across the full size spectrum — from community solar facilities under 5 MW to utility-scale wind and storage projects exceeding 200 MW — and tailors our interconnection support services to the specific requirements of each project size and technology type.

Network upgrades are the transmission system improvements that PJM determines are necessary to reliably accommodate a new generator's power output without causing voltage violations, thermal overloads, or stability issues. They can range from minor substation modifications costing tens of thousands of dollars to major new transmission lines costing hundreds of millions.

Under PJM's interconnection rules, the developer of the new generation resource is generally responsible for funding the network upgrades identified in the interconnection study. These costs are documented in the interconnection agreement and must be paid before the generator can achieve commercial operation (unless Provisional Interconnection Service is available).

Upgrade costs are one of the most significant variables affecting project economics. A project that is technically feasible and permitted may become uneconomical if the required network upgrades are prohibitively expensive. Keentel Engineering Services assists clients in:

• Estimating potential upgrade costs before formal application
• Identifying alternative points of interconnection that may trigger lower upgrade costs
• Evaluating cost-sharing opportunities with other projects in the same study cluster
• Negotiating the terms of interconnection agreements to protect client interests

While PJM's interconnection process is a federal regulatory construct overseen by FERC, state policies have an enormous practical impact on project development timelines within PJM's territory. The 13 states in PJM's footprint — including Pennsylvania, Ohio, New Jersey, Maryland, Virginia, Illinois, Indiana, Michigan, North Carolina, and others — each have their own siting laws, renewable portfolio standards, permitting processes, and utility regulatory structures.

States that have streamlined their energy project permitting processes can significantly compress the development timeline for projects that have already cleared PJM's interconnection queue. States with more complex or contested permitting environments can add years to a project's timeline even after PJM has approved the interconnection.

PJM's March 2026 update specifically acknowledges permitting as the primary obstacle for the 54 GW of generation that has cleared the interconnection process but remains unbuilt — and notes that some states have taken action to address this. Keentel Engineering Services tracks regulatory developments across all 13 PJM states and provides clients with state-specific permitting strategy advice tailored to each project's location and technology.

Keentel Engineering Services brings a combination of technical depth, regulatory expertise, and project management discipline that is essential for successfully navigating today's evolving interconnection landscape. Our value to clients spans the full project lifecycle:

• Technical excellence: Our engineering team has hands-on experience with PJM's study processes, transmission modeling tools, and interconnection agreement mechanics — ensuring that our clients' applications are technically complete and defensible from day one.
• Regulatory fluency: We stay current with every FERC order, PJM tariff revision, and state regulatory development that affects our clients' projects, translating complex regulatory language into actionable project strategy.
• Permitting coordination: We manage the federal, state, and local permitting processes in parallel with the interconnection study, compressing the overall development timeline.
• Client-centered service: We treat every project as if it were our own, providing transparent communication, realistic timeline assessments, and proactive problem-solving when challenges arise.
• Proven track record: Our team has supported successful interconnection and development outcomes across a broad range of project sizes, technologies, and PJM service territories.

In an environment where the interconnection process has been reformed, demand is surging, and the engineering talent market is competitive, working with an experienced and dedicated engineering partner is not a luxury — it is a competitive necessity.