New York, Jan 17, 2026, 04:58 EST — Market closed.
- Constellation Energy dropped 9.8% on Friday after Washington ramped up pressure on PJM regarding an “emergency” power auction and price caps.
- PJM detailed measures for data-center loads, such as “bring your own generation” and potential curtailment.
- U.S. markets remain closed Monday for MLK Day, shifting attention to PJM’s upcoming stakeholder deadlines and Constellation’s earnings report window.
Constellation Energy shares tumbled 9.8% to close at $307.71 on Friday, marking their steepest single-day decline in months. The selloff hit U.S. power producers tied to PJM following a late-week policy move targeting electricity price controls. Vistra dropped 7.4%, while NRG Energy slipped 4.1%.
The move comes at a tricky time for a trade behind much of the sector’s rally: betting on data centers tightening supply and pushing up wholesale prices for years. Now, a sudden pivot to caps and special procurement auctions pushes investors to weigh political risk alongside megawatts.
On Friday, the White House called on PJM Interconnection — the largest U.S. grid by area — to hold an emergency procurement auction and impose caps on what existing plants can charge in the capacity market, which compensates generators for being on standby for future demand. The administration also wants to push a “bring your own generation” policy, requiring new data centers to finance new power plants even if they don’t use the power. This comes after a recent PJM capacity auction hit record prices, soaring to more than eight times last year’s levels. 1
The Department of Energy is pushing to “build big reliable power plants again,” aiming to back over $15 billion in new baseload generation. Energy Secretary Chris Wright insisted that “high electricity prices are a choice,” while Interior Secretary Doug Burgum emphasized the plan would have tech companies, not taxpayers, foot the bill for new plants tied to the AI buildout. 2
PJM, the operator of the wholesale market spanning 13 states plus Washington, D.C., unveiled a new framework to address the surge in large data-center connections. Under its “connect and manage” plan, new major power users might have to either supply their own generation or agree to early curtailment. CEO David Mills highlighted the challenge: “how can we do this while keeping the lights on,” balancing the impact on consumers. 3
A PJM board letter dated Jan. 16 outlined immediate steps, including defining “large load additions” as 50 megawatts or more at a single interconnection point and pushing forward a voluntary “bring your own new generation” option. The board noted that the process and deadlines for a possible reliability backstop procurement will be discussed at PJM’s Jan. 22 Members Committee meeting. It also said an expedited interconnection track is expected to be operational by August 2026.
Constellation, a major generator in PJM, also highlighted some balance-sheet adjustments linked to its Calpine acquisition. A Jan. 15 SEC filing revealed the company wrapped up private exchange offers, swapping roughly $2.29 billion of Calpine notes for new Constellation notes with unchanged interest rates and maturities. 4
The policy path is complicated. Any emergency auction still requires approval from the Federal Energy Regulatory Commission. Capstone analysts noted the statement from governors and federal officials “lacks binding authority,” meaning an auction wouldn’t likely take place for at least six to 12 months. 5
For Constellation holders, the downside is clear: tighter limits on capacity-market payouts and a push toward new-build procurement might lower earnings expectations for generators who’ve relied on scarcity pricing. On the other hand, delays, legal hurdles, or a more lenient final rule could ease pressure — particularly if power demand outpaces supply growth.
The U.S. stock markets will be closed Monday in observance of Martin Luther King Jr. Day. Trading is scheduled to pick up again on Tuesday. 6
Attention will shift next week to how fast PJM moves from proposals to filings and deadlines, beginning with the Jan. 22 meeting. Also on the radar: Constellation’s earnings report, which Nasdaq’s calendar pegs for Feb. 17. 7
