The Federal Energy Regulatory Commission (FERC) voted unanimously to direct six regional grid operators to review or revise procedures for connecting large electricity users to the transmission system, including AI data centers. The goal is to shorten connection timelines that can currently stretch for years as developers seek power for energy-intensive computing facilities.
The order follows calls from Energy Secretary Chris Wright for faster access to electricity supplies as the US works to maintain momentum in the global AI race. Federal officials have linked AI development to economic competitiveness and national security, placing pressure on energy regulators to address constraints in the power system.
Under the new directive, regional grid operators and transmission owners must respond within 60 days, either defending existing policies or proposing changes. FERC is seeking clearer processes for handling large-load customers, determining infrastructure requirements, and assigning costs associated with serving those facilities.
The commission’s action applies to six regional transmission organizations serving roughly 200 million Americans. Texas, which operates largely outside FERC jurisdiction through its own grid system, is not covered.
Encouraging Alternative Approaches
Data centers have become one of the fastest-growing sources of electricity demand in the US. Research from the Electric Power Research Institute indicates they currently account for approximately 5% of national electricity consumption, a share that could triple by 2035.
Remarkably, some proposed data centers require power levels comparable to those of small cities. Developers report long waits to connect to high-voltage transmission networks, creating grid bottlenecks that could slow AI investment.
FERC Chair Laura Swett described the issue as one of the country’s highest infrastructure priorities. The commission’s orders are designed to speed decision-making while protecting grid reliability and limiting the financial impact on residential and business customers.
Cost allocation is a key part of the initiative. Rather than shift expenses to residential or small business ratepayers, large energy users applying for new connections would generally be responsible for funding upgrades needed to serve their projects.
The commission is also encouraging alternative approaches that could reduce pressure on the grid. These include allowing large customers to develop dedicated power supplies and potentially requiring facilities to reduce electricity consumption during periods of system stress.
Federal regulators are additionally urging grid operators to deploy technologies that increase the efficiency of existing transmission infrastructure, potentially creating more capacity without major construction projects.
Whether the nation’s power system can keep pace with data center demand is an open question. Utilities, grid operators and policymakers have warned that electricity consumption is rising after decades of relatively flat growth. The surge is being driven largely by data centers, electrification initiatives and industrial expansion.
Tech companies largely welcomed FERC’s decision, arguing that existing grid policies were developed for a different era of electricity demand. Environmental groups also expressed support for efforts that improve transparency and protect consumers from bearing the costs of serving large new loads.
The commission’s action does not establish a single nationwide framework. Instead, it gives regional grid operators flexibility to develop solutions tailored to local conditions while requiring greater clarity around how large power users will be integrated into the system.
One potential problem: many data center projects face obstacles beyond power availability. Developers continue to encounter permitting delays, shortages of equipment such as transformers and gas turbines, labor constraints and growing opposition from local communities.
Public resistance has increased in some regions over concerns involving electricity use, water consumption, noise, air quality and the conversion of open land for large data centers.
