FirstEnergy’s data center contracts jumped 50% in the second quarter, driving its Mon Power subsidiary to propose a customer surcharge that would finance $2.7 billion in new generation capacity in West Virginia — capacity built primarily to serve a single large data center campus. The move signals a growing trend where residential and small commercial ratepayers are being asked to underwrite infrastructure for hyperscale computing loads, raising questions about cost allocation fairness and long-term resource planning in Appalachia’s evolving grid.
The Maidsville project, a 1,300-megawatt combined-cycle gas plant, would be the largest single generation addition in Mon Power’s territory in decades. FirstEnergy frames it as essential for reliability and economic development, but the proposed surcharge mechanism — likely a fixed monthly charge or volumetric rider — would spread the capital cost across all customer classes regardless of who benefits from the data center’s presence. Consumer advocates and industrial groups have already signaled opposition, arguing that large loads should bear a proportionate share of the incremental infrastructure they require.
This dynamic is playing out across PJM territory, where data center demand growth has outpaced transmission and generation planning horizons. Utilities in Virginia, Ohio, and Pennsylvania are pursuing similar cost-recovery frameworks, testing regulatory appetite for socializing data center-driven investments. The Federal Energy Regulatory Commission’s recent focus on co-location and large-load interconnection standards adds another layer of uncertainty, as does the possibility that future capacity markets or clean energy mandates could alter the economics of gas-fired assets before they’re fully depreciated.
For FirstEnergy, the Q2 contract surge validates its strategy of positioning regulated subsidiaries as preferred partners for digital infrastructure. But the West Virginia proceeding will be a bellwether: if regulators approve broad-based cost recovery, it sets a precedent that could accelerate similar filings across the region. If they push back, utilities may need to negotiate bespoke tariffs or demand-response agreements that align costs more closely with the loads driving them.
Read the full report at Utility Dive.