New York, Jan 22, 2026, 20:01 EST — Market closed
- Constellation Energy shares slipped 2.4%, ending the session at $287.35, close to the day’s lowest point
- Wells Fargo lowered its price target to $460 but maintained an Overweight rating
- Traders are keeping a close eye on PJM policy changes as a deep freeze looms before next week’s peak demand period
Constellation Energy Corporation (CEG) shares dropped 2.4%, ending Thursday at $287.35 following an intraday range of $302.73 to $286.90. After-hours trading saw little movement, with around 4.7 million shares changing hands. 1
The decline is significant as Constellation finds itself caught between two rapidly evolving forces: political pressure to rein in power bills and a spike in electricity demand driven by data centers. Both factors converge on one key issue — wholesale power prices and the pricing of long-term contracts.
Constellation just got bigger. It wrapped up its Calpine acquisition this month, creating the country’s top electricity producer. CEO Joe Dominguez called it more than a merger of two strong companies – he said it’s about “strengthening America’s future.” 2
The drop happened despite gains in the wider market Thursday, where the S&P 500 rose 0.55% and the Nasdaq climbed 0.91%. 3
Wells Fargo’s Shahriar Pourreza cut his price target for Constellation to $460 from $478 but maintained an Overweight rating. He described it as the firm’s “Best IPP Idea”—independent power producer shorthand—highlighting “multiple DC deals in flight,” meaning data centers. 4
Washington’s push looms large. Last week, the White House called on PJM Interconnection—the grid operator for 67 million people across 13 states plus D.C.—to hold an emergency power auction. It’s also pressing for caps in PJM’s capacity market, which pays generators to stay ready for future demand. “PJM has been too damn slow to let new generation onto the grid,” said Pennsylvania Governor Josh Shapiro. 5
PJM followed up with its own plan. The operator will require new large power users either to provide their own generation or face curtailment—mandatory cutbacks during peak times. “This is not a yes/no to data centers,” PJM CEO David Mills clarified. 6
Volatility rippled through the sector. Utility Dive noted that generators linked to PJM, like Vistra, Talen Energy, and NRG Energy, also saw declines after the emergency-auction proposal came to light. 7
For Constellation, the debate has shifted from a single quarter’s results to the bigger picture: how the rules will be shaped and if demand growth remains strong enough to justify new contracts at elevated prices. That’s what’s been driving the tape.
There is a risk, though. Should policy discussions shift toward strict price caps or regulators push back on private power agreements, earnings forecasts could quickly come under pressure. Plus, if the weather risk diminishes, the short-term appeal of “tight power market” trades might evaporate just as fast.
Next week will test the system like never before. PJM issued a warning that peak demand might top 130,000 megawatts (MW) for seven days straight, with a new winter record possible on Jan. 27. The North American Electric Reliability Corporation raised alarms about heightened disruption risk from an Arctic blast. U.S. natural gas futures jumped 63% in three days as frigid conditions froze wells and pipes. Grid expert Philip Krein pointed to the shrinking maintenance window, saying it “makes the grid more vulnerable.” Traders will be closely watching developments through Jan. 27. 8
