FERC’s Push for Faster Data Center Connections | REPLAY

Research evidence excerpt

FERC’s Push for Faster Data Center Connections | REPLAY

Global | Washington Strategy July 6, 2026

FERC’s Push for Faster Data Center Connections

| REPLAY

The Federal Energy Regulatory Commission (FERC) issued orders to regional

grid operators on how large-loads (e.g. AI Data Centers) should connect to the

grid. We hosted Norton Rose Fulbright to discus. KTs 1) The orders are a Federal

.

attempt to standardize large-loads connections; 2) The orders alone cannot

solve the underlying constraint [i.e. insufficient transmission & generation]; 3)

Co-location remains attractive, but is not a full solution to constraints.

1) FERC Initiates Immediate Action Under Section 206 – FERC recently issued a show-cause

order to all 6 regional RTOs/ISOs. The Section 206 orders represent the first major Federal effort

to standardize grid connections for large-loads (e.g. AI data centers). Rather than pursuing broad

industry-wide rulemaking, FERC is seeking to compel RTOs/ISOs either to justify their existing

tariffs or to propose reforms addressing interconnection, cost allocation, co-location, and reliability

challenges. FERC has asked the RTOs/ISOs to respond on an accelerated timeline (60 days for

tariff responses and 30 days for generation adequacy reports) by either defending existing tariffs

or acknowledging gaps and proposing reforms. JEF Takeaways here.

2) FERC’s Preliminary Determinations – Instead of an industry-wide rulemaking in response to

the DOE ANOPR, FERC used Section 206 of the Federal Power Act to open specific show-cause

investigations into each RTO/ISO tariff. FERC is investigating whether an existing tariff is unjust

and unreasonable with the potential for significant changes. FERC’s preliminary determination was