Power for AI: Grid Queues, Nuclear PPAs, Gas Turbines — 2026-10-15

Top developments

FERC Rejects PJM’s Large Load Interconnection Proposal

On October 13, 2026, the Federal Energy Regulatory Commission (FERC) largely rejected PJM Interconnection’s proposed rules for connecting large loads to the grid. The agency dismissed PJM’s "curtail-first" plan, which would have required new large loads (defined as ≥50 MW) to accept curtailment services as a condition of interconnection. FERC approved only the definition of a large load and a registry for tracking these facilities, rejecting the core mechanism intended to mitigate grid reliability risks. This decision leaves PJM and other RTOs without a standardized regulatory framework for managing the rapid influx of data center demand, potentially increasing uncertainty for developers and utilities

Siemens Energy Expands Gas Turbine Production Amid Backlog

Siemens Energy is accelerating the expansion of its gas turbine production facility in Erlangen, Germany, to address a multi-year backlog driven by AI data center demand. The company reports that demand for gas turbines remains robust, with orders extending well beyond current capacity. While the expansion is underway, full operational ramp-up is expected to take approximately three years. This highlights the persistent supply chain constraints facing the global power industry as hyperscalers seek reliable baseload generation to complement intermittent renewables

SMR Stocks Slide as Market Reassesses AI Power Solutions

Investor sentiment toward small modular reactor (SMR) developers has turned negative, with shares of Oklo and NuScale falling sharply following a period of intense speculation. Analysts note that while AI data centers require significant new power, the timeline for SMR commercialization may not align with the immediate energy needs of hyperscalers. This correction suggests a shift in market expectations, favoring incumbent nuclear operators and natural gas solutions over next-generation SMR technologies in the near term

Local view

In Japan, Nikkei reported that Mitsubishi Heavy Industries’ US president expects global gas turbine demand in 2026 to match or exceed 2025 levels, driven by sustained AI-related electricity needs. The company is investing heavily to double production capacity by fiscal 2030, reflecting confidence in long-term fossil-fuel-backed generation for data centers. Meanwhile, German financial media like Boerse Express highlight that Siemens Energy’s order book remains strong, but execution speed and profitability of new capacity remain key watch items for investors.

Context & numbers

• PJM Capacity Auctions: PJM’s capacity prices have hit the ceiling for the third consecutive auction, with the 2026/27 auction clearing at $329.17/MW-day, reflecting extreme scarcity and high demand from large loads.
• Nuclear PPA Pricing: Recent nuclear PPAs for data centers indicate premium pricing, with inferred rates around $110–115/MWh for uprate projects and $68–95/MWh for existing capacity, depending on contract structure and risk allocation.
• Grid Demand Growth: Global data center power demand capacity is projected to reach 161 GW in 2026, a ~31% year-over-year increase, exacerbating grid supply gaps expected to widen through 2028.

On the radar

• Siemens Energy Q4 Earnings: Siemens Energy is scheduled to report Q4 results on November 11, 2026. Investors will be watching for updates on gas turbine backlog reduction and margin stability.
• FERC Show-Cause Responses: Stakeholders are monitoring whether other RTOs have filed responses to FERC’s June 18 show-cause order regarding interconnection reforms, which could set precedents for cost allocation and queue management.