The PJM Interconnection, the largest power grid in the United States, is running out of room. In Northern Virginia and Illinois, the rapid proliferation of data centers has pushed electricity demand to levels that existing infrastructure was never designed to handle. Wholesale prices have nearly doubled in a year, and major utilities are openly discussing an exit from the market.

Into this volatility steps Base Power, an Andreessen Horowitz-backed startup that is betting it can solve a grid-scale problem with a residential solution.

On Tuesday, the company announced its expansion into Illinois, marking its first move into PJM territory. Unlike traditional energy companies that build massive, centralized power plants, Base Power installs 25-kilowatt-hour battery systems in residential homes. By aggregating these "behind-the-meter" assets, the company creates a virtual power plant capable of feeding energy back into the grid when demand peaks and prices spike.

The End-Run Around Gridlock

For years, the PJM grid has been defined by a bottleneck. In 2022, the operator effectively paused applications for new power generation projects, creating a massive backlog that only began to clear this past April. For developers of utility-scale solar or wind farms, the wait times for grid interconnection can stretch for years.

Base Power’s strategy is to ignore the queue entirely. Because its batteries are installed at the residential level, they sit behind existing utility meters.

"We are deploying capacity behind the meter at the residential home, where an interconnection already exists, so we don’t wait in the interconnection queue," CEO Zach Dell told Canary Media. By bypassing the bureaucratic friction that has hamstrung traditional energy projects, Base Power can deploy capacity in months rather than the years required for a new substation or transmission line.

A New Economic Model for Home Energy

Base Power’s business model departs from the standard "buy-a-battery" approach popularized by companies like Tesla. Instead of selling hardware to homeowners, Base Power provides the battery and requires the customer to purchase electricity directly from them.

In Illinois, the company is undercutting the incumbent utility, ComEd, by 25 percent. It is a compelling pitch for consumers, but the real value lies in the arbitrage. The company charges its batteries when grid prices are low and dispatches that stored energy when the grid is stressed and prices are high.

This strategy has attracted significant capital. Following a $200 million round in April 2025 led by Andreessen Horowitz, Lightspeed, and Valor Equity Partners, the company secured a $1 billion infusion in October led by Addition.

What This Means for the PJM Grid

For the PJM region, the stakes are existential. The power crunch has become so severe that AEP, one of the region’s largest utilities, has publicly threatened to leave the market entirely.

Base Power is currently managing over 500 megawatt-hours of storage in Texas, proving the model works at scale. However, the PJM market presents a different set of regulatory and physical challenges. While the startup’s residential focus allows it to move quickly, it remains to be seen if a distributed network of home batteries can provide the baseload stability that a grid saturated with data centers requires.

Key Takeaways

  • Base Power is bypassing the PJM interconnection queue by installing batteries behind residential meters, allowing for rapid capacity deployment.
  • The startup offers electricity rates 25 percent lower than ComEd in Illinois, using an arbitrage model to profit from grid price volatility.
  • With $1 billion in fresh funding, the company is scaling a virtual power plant model that could provide a critical buffer for regions struggling with data center-driven power demand.

As the PJM Interconnection continues to grapple with its massive generation backlog, the success of Base Power’s Illinois rollout will serve as a bellwether for the industry. If the startup can maintain its 25 percent price advantage while reliably dispatching power during peak demand, it may force a shift in how grid operators view residential assets. The next major test arrives in the coming summer months, when the PJM grid faces its first true stress test of the season; by then, the company will need to prove that its distributed network can handle the heat.