The Federal Energy Regulatory Commission on Thursday unanimously ordered six major grid operators to fast-track interconnection requests from data centers and other large electricity users, giving AI infrastructure a government-mandated lane onto the US transmission system. Grid operators have 30 days to report how much generating capacity they have to spare and 60 days to defend or revise electricity rates in their regions. Data centers will pay the costs of their own interconnections. The orders land against a backdrop where wholesale electricity rates have climbed as much as 267% compared with five years ago.
The directives also push grid operators to consider alternative transmission technologies, an opening for grid-tech startups working on solid-state transformers, superconducting lines, and other equipment that can move more power across existing rights-of-way. FERC did not name specific vendors. Operators were also told to be more accommodating to behind-the-meter power, the on-site generation that hyperscalers have increasingly turned to when grid timelines stretch into years.
Electricity demand from data centers is expected to nearly triple through 2035, a load profile grid operators are not built for. The country's major regional grids spent the last two decades managing near-zero demand growth. PJM, the largest grid operator in the United States, has descended into something resembling chaos under the new load, with major utilities threatening to withdraw.
Key facts
- 01FERC unanimously ordered six major grid operators to fast-track interconnection requests from data centers and other large electricity users.
- 02Grid operators have 30 days to report spare generating capacity and 60 days to defend or revise electricity rates within their regions.
- 03Electricity demand from data centers is projected to nearly triple through 2035 after two decades of near-zero demand growth.
- 04Wholesale electricity rates are up as much as 267% compared with five years ago, according to Bloomberg.
- 05The Trump administration paid Invenergy $765M to cancel offshore wind leases that would have generated 2.4 gigawatts, bringing total wind cancellations to $2.6B.
The bottleneck isn't only on the demand side. At the end of 2023, grid connection requests from new power plants exceeded the total capacity of the existing US power plant fleet — meaning the queue to plug new generation into the grid was longer than the grid itself could theoretically serve. Fast-tracking data center interconnections does not, on its own, conjure the megawatts needed to feed them.
FERC was prodded into action by Secretary of Energy Chris Wright, who flagged the issue in October.
“delays in data center grid connections had threatened to undermine U.S. competitiveness in AI”— Chris Wright, Secretary of Energy
Public sentiment toward AI and data centers has soured considerably since Wright's October remarks, with local opposition to new builds rising in several US markets. The FERC orders do not address siting disputes or community pushback; they target the federal regulatory layer that controls how quickly an approved project can plug into the wholesale market. That is a narrower fix than the politics around data centers now demand, but it is the lever FERC actually controls.
On the supply side, the Trump administration on Wednesday said it would pay wind developer Invenergy $765 million to cancel offshore wind leases off California, Maine, and New York. Invenergy said it would redirect the money toward natural gas plants in the Midwest and geothermal projects in the West. One of the cancelled wind projects would have generated up to 2.4 gigawatts at peak — enough, in theory, to supply roughly 1.8 million homes, or a meaningful slice of the new data center load FERC is trying to accommodate.
Altogether, the Trump administration has now spent about $2.6 billion to scuttle offshore wind developments, a figure that competes for attention with the FERC orders as a signal of where US power policy is heading. Gas and geothermal can serve data center loads; the substitution is real, but it shifts the buildout from a fixed-cost, weather-dependent profile to one tied to fuel markets and longer permitting timelines for new pipelines.
For AI operators, the FERC orders are the first piece of federal regulatory machinery to explicitly treat data center grid access as a national-competitiveness issue rather than a local utility matter. That changes the negotiating posture for OpenAI, Anthropic, Microsoft, Google, Meta, and the merchant data center operators serving them — interconnection delays that previously stretched two to four years now have a federal stopwatch attached. Whether the spare capacity exists to make those connections meaningful is the harder question, and the 30-day capacity reports will be the first honest answer the market has had in years.
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