FERC's order directing NERC to establish mandatory reliability standards for data center loads by December 31, 2026, is the regulatory capstone on a week that makes one thing unmistakable: the era of frictionless data center power access is over. PJM's capacity auction hitting the $325/MW-day price cap while falling 6.8 gigawatts short of its reliability target shows the market already pricing in the consequences of load growth outrunning supply, and Virginia's first-in-the-nation $0.011/kWh electricity consumption tax, landing squarely on Data Center Alley, confirms that states are no longer willing to absorb grid externalities while federal cost-allocation disputes grind through FERC settlement proceedings like the one now underway on the Kammer-Juniata 765-kV corridor. For site selectors and procurement teams, the compounding message across all four developments is the same: the jurisdictions and interconnection queues that look cheapest today are repricing fastest, and any project without locked-in capacity, a clear transmission cost picture, and a compliance posture built for enforceable reliability standards is carrying more schedule and cost risk than its proforma reflects.
Feature
CONNECTOR MARKETS, Queue Depth · Load Signal · This Week
Where interconnection queue activity, load growth, and current market signals converge.
| ISO |
Queue Depth |
Load Signal |
This Week's Signal |
Status |
| ERCOT | 1,828 | +3.1% | Texas PUC approves 'ride-through' rules requiring data centers to withstand voltage and frequency excursions to protect grid reliability. | PROCEED |
| FRCC | 1,162 | +0.9% | Palm Beach County commissioners voted 5-1 to reject Project Tango, a 600 MW AI data center campus, citing noise, water, traffic, and land-use concerns. | WATCH |
| SPP | 1,072 | 0.0% | Monolith plans modular data center on ~10 acres at Olive Creek carbon black plant in Hallam, NE, with Crusoe as prospective partner. | MONITOR |
| NYISO | 343 | 0.0% | NY Gov. Hochul signs yearlong moratorium on data centers over 50MW, halting ~$10B pipeline and ~12GW in NYISO queue over cost and community concerns. | WATCH |
| ISO-NE | 373 | 0.0% | No signals this week | MONITOR |
| WECC | 1,564 | -0.1% | Arizona lawmakers moving to slow rapid data center development driven by AI-industry demand, joining other states tapping the brakes. | WATCH |
| MISO | 1,657 | -0.5% | Meta expands Richland Parish, Louisiana data center campus to 5GW with $50bn investment. | WATCH |
| PJM | 1,558 | -1.2% | PJM's 2028/29 capacity auction cleared 138,318 MW at $325/MW-day cap, falling 6,831 MW short of reliability requirement amid growing DC demand. | WATCH |
| CAISO | 358 | -2.4% | Avantus signs 20-yr PPA with Clean Power Alliance for 200MW/800MWh Rexford 2 solar-plus-storage project in Tulare County, CA | WATCH |
Spotlight, Notable Developments This Week
Data center developers are reconsidering Florida projects amid stark local opposition to siting and power demands.
Florida is emerging as a higher-risk development jurisdiction as local opposition to data center siting and power consumption intensifies, signaling longer entitlement timelines and potential project cancellations. Developers evaluating Southeast U.S. expansion should weight Florida sites with increased political and regulatory risk premiums, particularly in markets where grid strain narratives have gained public traction.
Digital Realty pays $3.5B to acquire Blackstone's stakes in their joint venture data center portfolio
Digital Realty's $3.5B buyout of Blackstone's JV stakes signals a strategic consolidation of power-anchored assets under direct operator control, removing a financial partner likely seeking liquidity as valuations peak. For site selectors and investors, this reinforces that hyperscale-adjacent campuses with secured utility capacity are trading at premiums that justify full ownership structures over shared equity arrangements.
AWS files for $1.2bn data center campus outside Houston, Texas
AWS has filed permits for a $1.2 billion data center campus near Houston, signaling a major hyperscaler commitment to ERCOT, a deregulated market that offers flexible power procurement but carries real-time price volatility risk. For site selectors and CRE investors, this validates the Greater Houston submarkets as a credible hyperscale destination, likely intensifying competition for large-block power capacity and shovel-ready land in the region.
EQT acquires energy and data center developer Copia Power from Carlyle.
EQT's acquisition of Copia Power from Carlyle consolidates a vertically integrated energy-plus-data-center development platform under a deep-pocketed infrastructure investor, signaling intensifying competition for sites where co-located power generation and compute capacity can be developed together. For data center developers and CRE investors, this deal underscores the growing premium on controlling power from the source, greenfield site selection increasingly favors platforms that can self-supply generation rather than queue into constrained utility interconnection pipelines.
Lead Story
FERC orders NERC to file mandatory reliability standards for data center and computational loads by Dec 31, 2026, citing grid stability risks.
FERC's directive to NERC signals that data center load interconnection and operational behavior will shift from voluntary guidelines to enforceable reliability standards by end of 2026, fundamentally changing compliance obligations for large-scale compute developments. Site selectors and power procurement teams should anticipate stricter interconnection requirements, potential load flexibility mandates, and longer queue timelines as utilities and RTOs begin aligning processes ahead of the deadline.
FERC Orders NERC to File Mandatory Reliability Standards for Data Center and Computational Loads by Dec. 31, 2026, Citing Grid Stability Risks
Federal regulators have drawn a hard line on data center grid behavior. FERC's directive to NERC to develop enforceable reliability standards for large-scale computational loads by the end of 2026 marks a structural shift in how hyperscale and colocation developments will be permitted to interconnect and operate. What has historically been governed by voluntary best-practice guidelines will become binding compliance obligations, carrying the enforcement weight that utilities, RTOs, and load-serving entities are already required to meet. The timing is not incidental: FERC is responding to documented grid stress events tied to the rapid, concentrated buildout of AI and high-performance compute capacity across multiple transmission zones, and the order signals that regulators view the current voluntary framework as inadequate for the load profiles now entering the queue.
For data center developers and independent power producers, the practical consequences will emerge well before the December 2026 filing deadline. RTOs and utilities will begin pre-aligning their interconnection processes, tariff structures, and technical requirements in anticipation of the new standards, meaning the compliance environment starts tightening now rather than at promulgation. Developers should expect interconnection applications for large compute loads to face more rigorous technical scrutiny, including documentation of ramp behavior, load forecasting methodology, and operational flexibility. For co-located generation arrangements, the standards may also impose new requirements around islanding capabilities, protection coordination, and dispatch transparency that go beyond current practice in most regions. Queue positions filed in the next 12 to 18 months will increasingly be evaluated under this emerging framework.
Three areas warrant immediate attention for site selection and procurement teams. First, jurisdictions with congested queues and already-strained transmission infrastructure, particularly PJM and ERCOT, are likely to implement the most restrictive interpretations of any new standards, making greenfield site identification in those territories more complex and timeline-dependent. Second, load flexibility mandates are a real probability: FERC has explicitly flagged the operational unpredictability of large compute loads as a reliability concern, which could translate into contractual or tariff-based curtailment obligations as a condition of interconnection. Third, procurement strategies built around firm capacity with minimal operational obligations may need to be restructured, as the new standards could require demonstrated flexibility commitments rather than simply contracted MW.
Read more →
Development Activity
Announcements
Crusoe and Lancium announce 1.0 GW grid-connected AI data center campus in Childress, Texas with Q3 2026 construction start
Crusoe and Lancium announced a 1.0 GW grid-connected AI campus on 270 Lancium-owned acres in Childress, Texas, purpose-built for a hyperscale anchor tenant with construction starting Q3 2026. The deal structure is the signal: Lancium owns the land, secures the interconnect, and manages energy orchestration while Crusoe builds and operates the data center, the same division of labor that took their Abilene campus from groundbreaking to energization in roughly a year and has since scaled it to 1.2 GW. Splitting interconnection risk from compute delivery is emerging as the fastest replicable model for gigawatt-scale ERCOT development.
Source: Crusoe
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BlackRock's GIP and ACS launch Coravel, a vertically integrated AI data center platform, with 140 MW hyperscaler deal signed in Dallas-Fort Worth
BlackRock's Global Infrastructure Partners and ACS Group launched Coravel on July 15 as a 50/50 vertically integrated AI data center platform, opening with a signed 140 MW hyperscaler agreement in Dallas-Fort Worth and a 1.7 GW pipeline behind it. The platform's pitch, unified power procurement, construction (via ACS-owned Turner), and operations under one roof, is a direct response to the equipment and interconnection bottlenecks now gating delivery: transformer lead times have stretched to three to five years and switchgear is sold out through 2028. Institutional capital is concluding that controlling the power pathway end-to-end is the only reliable route to service dates.
Source: TechTimes
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Nashville freezes data center permits while city drafts first-ever zoning rules for the industry.
Nashville has imposed a moratorium on data center permits as the city drafts its first formal zoning framework for the sector, creating a temporary but significant barrier to entry in a market that has attracted growing hyperscaler and colocation interest. Developers with active site selection processes in the Nashville metro should pause land commitments until zoning parameters are defined, as the new rules will likely govern setbacks, power infrastructure requirements, and permissible districts for years to come.
Source: Policy
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Regulatory & Policy
Signals Worth Watching
This Week's Policy Flags
TransmissionFERC orders settlement judge proceedings on formula rates for 765-kV Kammer-Juniata transmission line in PJM serving data center demand
FERC's directive to initiate settlement judge proceedings on formula rates for the 765-kV Kammer-Juniata line signals regulatory scrutiny over how transmission costs will be allocated for a high-capacity corridor increasingly tied to data center load growth in PJM. For site selectors and power procurement teams, the outcome will directly influence the cost structure of accessing bulk transmission infrastructure in one of the most congested and demand-pressured regions of the eastern grid.
Read more → · Source: RTO Insider
RegulatoryVirginia enacts first U.S. data center electricity consumption tax at $0.011/kWh, effective July 1
Virginia became the first U.S. state to tax data center electricity consumption, imposing $0.011 per kWh on both utility-supplied and self-generated power effective July 1, 2026, with revenue capped at $600 million annually. The levy applies directly in PJM's Northern Virginia core, Data Center Alley, and signals that states are moving to recapture grid-cost externalities through operating taxes rather than waiting for FERC to resolve cost-allocation disputes.
Read more → · Source: forbes.com
RegulatoryPJM capacity prices hit price cap as grid operator misses reliability target by 6.8 GW, driven by data center load growth
PJM's latest capacity auction hit the $325/MW-day price cap across its entire footprint while falling 6.8 GW short of the reliability target, a direct consequence of data center load forecasts rising faster than new generation can come online. For developers and site selectors, this is the clearest market signal yet that capacity costs in PJM will remain elevated and that projects without committed power supply face compounding cost exposure as the backstop procurement mechanism shifts more of the burden directly onto large-load customers.
Read more → · Source: Utility Dive
PPA & Financing
Market Pricing Context
Avantus executed a 20-year PPA with Clean Power Alliance for the Rexford 2 project, 200MW solar paired with 800MWh of storage in Tulare County, California, establishing a current CAISO benchmark for long-duration, co-located renewable offtake. The deal structure, a 20-year fixed-price agreement with a load-serving entity, reflects the pricing floor developers and offtakers are anchoring to in a market where interconnection queue competition and resource adequacy obligations are both tightening.
Read more → · Source: pv magazine USA
Power market intelligence from a practitioner with two decades in utility-scale development, from site origination and land control through interconnection, offtake, and delivery to NTP. 5+ GW delivered across major U.S. ISOs and RTOs. The analysis connects public news to what's actually moving in the queue.
The Interconnect is part of the NexPhase Intelligence Platform, alongside DC Site Intelligence and The Morning Read: intel.nexphaseadvisory.net/platform/
This brief is complimentary intelligence, built from public news, queue data, and regulatory filings, filtered through a practitioner's read of what actually moves projects. It's the analysis I'd want on my desk on a Monday morning, shared because the market is moving faster than most coverage of it.
Coverage suggestions welcome — reply anytime. The best story tips come from people in the queue.
Chris Santiago
chris@nexphaseadvisory.net