FERC Orders NERC to Establish Data Center Reliability Standards; Deadline Set for December

The U.S. Federal Energy Regulatory Commission (FERC) unanimously ordered the North American Electric Reliability Corporation (NERC) on July 16 to develop mandatory reliability standards for data centers and other computational loads, with a deadline of December 31, 2026. The decision, voted 5-0, converts NERC's voluntary timeline into a federal mandate.

The order, identified as Docket RD26-7-000, responds to the accelerated growth in electrical demand from data centers supporting artificial intelligence and cryptocurrency mining. According to Power Magazine, a recent incident on the Eastern Interconnection saw approximately 1,500 MW of data center load disconnect within milliseconds following a transmission failure. FERC Chair Laura Swett warned that these facilities "can shift their demand almost instantaneously," creating voltage stability risks.

The measure complements orders FERC issued on June 18 requiring the six regional grid operators (RTO/ISO) to justify their interconnection tariffs for large loads. NERC had already activated in May an Essential Action Alert Level 3, its highest urgency category, and submitted its Large Load Action Plan in March.

The mandate sets two concrete deadlines. By December 31, 2026, NERC must submit one or more new or modified reliability standards, along with registration criteria defining which computational load entities will fall under mandatory oversight. By March 1, 2027, it must deliver a Phase II work plan with additional standards, according to the American Public Power Association.

NERC proposes to define computational load as the "power demand of information technology equipment, such as servers, storage, and network hardware." Commissioner David Rosner described the timelines as "very fast" by regulatory standards. NERC is expected to publish the proposed standards for public comment in August, with board approval on December 5 and submission to FERC before year-end.

With more than 2,060 GW of generation and storage in the interconnection queue as of the close of 2025, according to the Lawrence Berkeley National Laboratory's Queued Up report, FERC's decision is the clearest regulatory signal to date on how the United States will integrate data center demand into its grid. The August public comment period will be the next window for developers, operators, and state regulators to stake out positions on the scope of the new standards.

This article was drafted with artificial intelligence assistance from verified sources and reviewed by a human editor before publication.