The AI Boom Meets the Power Grid in the Delaware Valley
America's artificial intelligence boom is turning into buildings, transmission lines and power plants. The four hyperscalers, Amazon, Microsoft, Alphabet and Meta, plan combined 2026 capital spending of roughly $650 billion to $725 billion, up more than 70 percent from about $410 billion in 2025. Amazon plans about $200 billion, Microsoft about $190 billion, Alphabet $175 billion to $205 billion and Meta $115 billion to $145 billion. Evercore and Bank of America expect the combined total to pass $1 trillion in 2027.
The money is landing on data center construction sites. United States data center construction starts reached $84.1 billion through July 2026, nearly three times the same period a year earlier and about a quarter of all nonresidential construction starts. The average project cost jumped from $353 million to $1.06 billion. A data center is no longer a warehouse-like building. It is an industrial facility costing $1 billion a building.
A boom measured in gigawatts
Measured in power, the boom looks bigger still. United States data centers draw about 49 gigawatts today, and the pipeline of planned and under-construction projects is estimated at about 350 gigawatts. According to real estate services firm JLL, about 66 gigawatts was under construction across North America in the first half of 2026, 95 percent of it already leased. Texas led with about 26 gigawatts, Virginia with about 13 gigawatts.
But not every announced plan becomes a building. Of 16 gigawatts announced for delivery in 2026, only 5 gigawatts was actually under construction, according to one industry tally. Transformer lead times average 128 weeks, and generator step-up units 144 weeks. Transformers, not chips, are the scarce item. To get around the bottleneck, developers are building power plants alongside data centers. Gas-fired generating capacity under construction in the United States reached 52 gigawatts by mid-2026, up 76 percent in six months, of which 16.9 gigawatts was directly for data centers.
The fight over electric bills is growing with it. In a White House pledge on March 4, 2026, seven companies, Amazon, Google, Meta, Microsoft, OpenAI, Oracle and xAI, promised to pay their own data center power infrastructure costs, so that households would not pick up the bill for higher electricity prices caused by data centers. How that promise works on an actual monthly bill has not yet been verified.
Where the boom meets the grid
The Delaware Valley is where this national boom runs into a regional grid. The region, Philadelphia and its suburbs, southern New Jersey and New Castle County, Delaware, sits inside PJM, a grid operator serving 13 states and Washington, D.C., and about 67 million people. PJM expects peak demand to grow by about 32 gigawatts by 2030, with about 94 percent of that growth coming from data centers.
The warning lights are already on. On July 2, 2026, PJM demand hit an all-time peak of about 168,158 megawatts. That month's capacity auction cleared at the cap of $325 per megawatt-day and still fell 6,831 megawatts short of its reliability target. A study released Sept. 14 by the Pennsylvania Public Utility Commission warned that without policy changes, the grid would fall short of its reliability standard every year from 2027 through 2030, with risk in 2030 running six times the standard.
But the demand forecasts are not all coming true. PJM's independent market monitor told the Federal Energy Regulatory Commission that 4,016.9 megawatts of data center load had been canceled or delayed as of Sept. 21, 2026, equal to 42 percent of projected growth. On Sept. 29, the commission accepted 11 of 15 key elements of PJM's emergency procurement plan as reasonable but suspended it until Feb. 28, 2027, over cost allocation. PJM had sought to secure 6.8 gigawatts for 2028 and 2029. Forecasts and rebuttals are piling up at the same time.
Projects across the Delaware Valley
Against that backdrop, big projects are moving all at once across the Delaware Valley, though the largest of them has taken a sharp turn. In Upper Merion Township, Montgomery County, a 4.6-million-square-foot campus proposed by MLP Ventures was unanimously rejected by the township Board of Supervisors on Aug. 13, 2026, over gaps in fire safety documentation and unanswered questions in the review process. The developer sued the township, a Montgomery County judge froze the review, and the developer ultimately withdrew its applications. The project's fate is now in court. The scale itself is unchanged. The plan included 1 gigawatt of on-site gas generation, and a developer-commissioned economic impact analysis estimated about 9,563 construction jobs a year in Montgomery County during construction from 2026 through 2029, 717 direct jobs once stabilized, and an average salary of $145,000. The gap between the construction boom and the operating jobs is the project's most important number.
In nearby Plymouth Township, a plan for about 2 million square feet reusing 10 existing buildings on a 66-acre closed steel mill site is moving forward. According to developer analysis, it would hold up to 640 megawatts of IT load, with construction from January 2027 through December 2029 and stabilization in September 2030. Construction jobs are estimated at about 5,000 a year, and direct jobs at stabilization at 371. The township planning commission voted 4-0 on Oct. 1 not to recommend the plan, though at this stage in Pennsylvania that recommendation is not final.
In Limerick Township, a proposal called Project Laurel would put eight buildings totaling 1.4 million square feet on 192 acres. It was reported to have secured 750 megawatts of capacity from the local utility PECO, and the site sits within a mile of the 2.2-gigawatt Limerick nuclear plant. Full build-out could take up to five years, and an opposition petition has gathered more than 680 signatures.
In Falls Township, Bucks County, the Keystone Trade Center won township supervisors' approval to convert part of a logistics park plan to data center use, covering about 2 million square feet of data centers and the conversion of 1.35 million square feet of existing distribution space. The project redevelops more than 1,850 acres of the former US Steel site, and Amazon named Falls Township as one of its first campuses when it announced a $20 billion Pennsylvania investment in June 2025. Township officials project about 1,250 jobs.
Across the Delaware River in New Castle, Delaware, Starwood Digital Ventures has applied for Project Washington, 11 buildings, 6 million square feet and 1.2 gigawatts on 580 acres, supplied by the Delmarva Power Red Lion substation, with construction targeted for the third quarter of 2026 and operations targeted for the second quarter of 2028. Whether any tenant is secured is unknown, and whether construction actually began in the third quarter of 2026 was unconfirmed as of Oct. 28.
Beyond the Valley's borders
Staying inside the Delaware Valley's boundaries alone cuts off the full picture, because projects elsewhere in Pennsylvania on the same grid, in the same debate, are bigger or moving faster than the Valley's. In Salem Township, Luzerne County, in northeastern Pennsylvania, supervisors voted 2-0 on Oct. 27 to expand a data center overlay district. The project is a 4-gigawatt energy and digital campus on 4,466 acres, with a potential $1.4 billion land sale driven by 194 participating households. The planning commission had recommended it unanimously on Sept. 24. At four times Upper Merion's 1 gigawatt, it dwarfs the Delaware Valley's largest project.
In Gregg Township, Union County, a PNK Group data center won conditional approval despite strong opposition. It is a comparatively small project starting at 252,000 square feet inside an existing building, but it carries 31 conditions on noise, water use and environmental issues, with dozens of residents opposed and legal action threatened. It is not only the big projects that draw controversy.
Statewide, the movement is broader still. According to the state Department of Environmental Protection, more than 100 Pennsylvania data center proposals appear in public databases, 58 have had some level of contact with the agency, 15 have applied for permits, and five hold all the permits needed for first-phase development. On the national map, the Delaware Valley is still a latecomer. In JLL's tally, Virginia is at about 13 gigawatts and Texas at about 26 gigawatts. The reported capacities of the projects in this article alone approach 3 gigawatts, but on the national scale the region is only just getting on board.
Patterns and politics
A few patterns repeat across these projects. First, locations next to nuclear plants, with the Limerick plant project the clearest case. Second, reuse of industrial sites, with the old steel mill and the logistics park being converted to data centers in Plymouth and Falls Township at the same time. Third, self-generation, most dramatically at Upper Merion, as developers build power plants to avoid waiting for grid connections.
Fourth, community opposition has become an election issue. Plymouth's non-recommendation, Limerick's petition and the failure of data center regulation bills to reach agreement in the state legislature sit on the same current. The governor's position has shifted over time. Gov. Josh Shapiro welcomed Amazon's $20 billion investment in 2025, saying Pennsylvania was all in on AI, but in August 2026 he issued an executive order, EO 2026-05, putting local approval first, requiring developers to bear the full cost of infrastructure, mandating community benefits agreements and water conservation, and prohibiting nondisclosure agreements. Shapiro calls the rules the strictest guardrails in the nation and opposes a moratorium, while Republican gubernatorial nominee Stacey Garrity argues a moratorium is needed to fix local ordinances.
Finally, there is what has not been disclosed, water use. Even Falls Township's records note that water-related documents have not been made public. Power numbers are abundant, but water numbers are scarce. The Delaware Valley data center debate began as a question of grid capacity, but it will be judged on water, electric bills and the real benefits of the jobs. The Salem project in northeastern Pennsylvania sits outside the Delaware Valley administratively, but it is on the same grid and in the same debate. Cutting the picture by regional boundaries alone distorts the whole.
