Exelon plans comprehensive expansion in the Mid-Atlantic region for energy transition

The American energy provider Exelon has announced plans to enhance its power plant ownership activities in its Mid-Atlantic service region next year. In this area, electricity bills are rising due to increasing demand and the sluggish provision of new energy sources, CEO Calvin Butler told Reuters. Exelon's endeavor is highlighted by the challenges faced by PJM Interconnection, the largest power grid in the U.S., which supplies electricity to over 65 million people from the Midwest to the Mid-Atlantic. PJM is encountering supply gaps driven by the growing energy demands of data centers and the electrification of industries such as transportation. As early as July, Exelon had considered exploring options for building and owning regulated power generation, which is legally prohibited for energy providers in about half of the U.S. states. In these states, independent energy producers operate power plants to diversify the market and prevent competitive distortions. In order to alleviate the existing power supply deficit and reduce prices, Butler emphasized the need for legislative changes that would allow Exelon to establish new regulated power plants. To this end, the company plans to engage in discussions with legislators and governors ahead of next year's legislative sessions. Butler views the 2026 sessions as a promising opportunity to advance these efforts. In the U.S., approximately half of the states are considered deregulated, meaning energy providers are not allowed to own regulated power plants. This was introduced in the 1990s in response to rising electricity costs. However, states such as Maryland and New Jersey have considered adjusting their laws in light of current cost developments. Butler, an advocate of competitive markets, perceives a dysfunction of these principles in the PJM area. With projected record-high electricity demand for this year and next, Exelon plans to build solar installations in low-income urban neighborhoods to reduce electricity costs. Exelon, with nearly 11 million customers, is one of the largest energy providers in the country, serving some of the poorest urban communities such as Philadelphia, Baltimore, and Atlantic City. These cities experienced the most significant increases in electricity bills during the summer. However, independent power providers warn that regulated power plants could lead to further cost increases. Butler argues that regulated providers can often offer more economical conditions – they have lower capital costs, faster approval processes, and could achieve better terms for the customer.