On June 18, FERC ordered six regional grid operators to show why their existing rules shouldn't be rewritten so that large loads, defined as single sites pulling more than 50 megawatts, pay for the transmission upgrades they require. The instrument is a cost recovery agreement between the grid operator, the transmission owner, and the data center, backed by credit support tied to the requested capacity. If a data center orders a $200 million upgrade and never shows up, existing customers no longer eat the loss.
Good. But "bear the full cost" covers less territory than it sounds like.
FERC governs wholesale transmission. Your electric bill is set by your state. The order explicitly acknowledges that preventing retail cost-shifting is a state responsibility. So when new data-center demand drives up capacity auction prices or requires generation and distribution spending, those costs can still land on residential bills through state-regulated rates. The order doesn't touch them.
And these are show-cause proceedings, not final rules. No tariff language exists yet. RTOs have 60 days to respond. Data centers that finalized interconnection agreements before new tariffs take effect are grandfathered. Roughly a third of Americans live outside RTO territory altogether, with no federal coverage under these orders. States like New Jersey and Florida are writing their own protections. States that haven't are leaving the question open.
The order sets a floor. Whether anybody builds walls and a roof depends on six regional proceedings, fifty state legislatures, and a timeline energy lawyer Mona Dajani summarized neatly: "six regional answers to the same question, decided on six different timelines."
What the order covers: Wholesale transmission upgrade costs caused by new loads over 50 MW connecting at high voltage. Credit support required upfront; searchable cost data posted before interconnection.
What it doesn't cover: Retail electricity rates (state jurisdiction). Capacity market price increases from new demand. Generation and distribution costs. Loads under 50 MW. Non-RTO regions (~1/3 of Americans).
What doesn't exist yet: Actual tariff language. RTOs must file responses by mid-August 2026; extensions possible. FERC says it will dictate terms if responses are "insufficient or untimely."
What's grandfathered: Interconnection agreements finalized before new tariffs take effect, potentially including the largest current data-center buildouts.
State action filling the gap: New Jersey's A796/S731 requires data centers ≥50 MW to cover transmission and distribution costs, commit to 85% of requested load for 10 years, and post financial security. Awaiting governor's signature. Florida, Oregon, and others have passed or proposed similar rules.
Scale reference: A 100-home neighborhood uses ~0.5 MW. A single large data-center campus can exceed 1,000 MW.