NERC Proposes Federal Reliability Registration for Large Data Centers

The Petition comes in response to a sharp increase in electricity demand. Recent NERC reliability assessments show demand growing faster than at any point in the past two decades, driven in substantial part by data centers and similar facilities. Based on large-load survey data, NERC projects that computational load could account for approximately 90% of large load by the end of 2027, heightening reliability concerns where such loads are concentrated.

The behavior of computational loads also presents distinct challenges. NERC has identified data centers, AI compute clusters, cryptocurrency mining operations and similar facilities as software-controlled loads that can change consumption rapidly and unpredictably. Large, simultaneous reductions in consumption during grid disturbances can affect voltage, frequency and grid stability as more computational load connects to the BPS.

NERC’s gap analysis found that utilities and other entities already registered with NERC cannot fully address these risks on their own. Grid planners and operators have reported difficulty coordinating directly with large load entities and obtaining data on how facilities use electricity and respond to grid events. As a result, NERC concluded that direct reliability obligations for computational load owners and operators are needed to improve grid studies, demand forecasts and coordination with grid operators.

The Proposed Solution
NERC has proposed adding two categories to its Compliance Registry: Computational Load Owner (CLO) and Computational Load Operator (CLOP). These categories would apply to entities that “own and maintain” or “operate” a Computational Load Site (“Site”) with at least 50 MW of total connected load supplied through electrical equipment connected to the BPS at 100 kV or above through one or more connection points.

The new federal energy regulatory approach is a first for large data centers, traditionally considered large electric utility customers or “load” whereas, until now, NERC’s federal reliability reach has extended to larger wholesale power generating stations and the interstate electric transmission system. Upon FERC approval, data center owners and operators—essentially commercial real estate facilities—will become subject to the reliability standards adopted under the Federal Power Act (FPA).

A qualifying Site consists of one or more buildings, structures or installations at a single location that primarily contain information technology infrastructure used for software applications and services, artificial intelligence activities, cryptocurrency mining or other data center computational activities. Total connected load includes supporting electrical systems, and the voltage test generally looks to the grid-facing, high-voltage side of the equipment supplying the Site, regardless of who owns that equipment. A campus may be treated as one Site even if it spans multiple parcels or connection points; NERC would assess the actual configuration.

NERC estimates that the proposed thresholds would capture approximately 68,288 MW, or roughly 86% of projected computational load by year-end 2027. The thresholds are intended to focus registration on Sites posing greater aggregate risks to BPS reliability.

Registration would make qualifying CLOs and CLOPs responsible for complying with applicable Reliability Standards. The related standards effort addresses demand forecasts, models of facility electrical behavior, coordination with grid operators and responses to grid disturbances. Once the applicable standards are approved and effective, registered entities would be subject to NERC audits and enforcement, including potential penalties pursuant to the FPA. NERC is now seeking expedited FERC approval of the registration criteria to begin outreach and help companies prepare for registration and compliance.

The Broader Regulatory Context
The Petition advances the broader Department of Energy (DOE) and FERC efforts to address the reliable integration of large electricity loads into the wholesale power grid. In October 2025, DOE directed FERC to consider an Advance Notice of Proposed Rulemaking on large-load interconnections, including potential changes to NERC’s standards and registration categories. FERC’s July 16, 2026, Computational Loads Order subsequently directed NERC to develop initial Reliability Standards and registration criteria, with initial standards due by December 31, 2026, and proposed registry revisions expected by the same date.

As we discussed in our June 24 client update, FERC is pressing regional grid operators to clarify and improve access for large loads, including flexible service and generation located at or near data centers. NERC’s proposal supplies part of the reliability framework needed to support that access. It does not itself grant interconnection or transmission rights, and registration as a load owner or operator does not make a data center a generator. For developers, the practical goal is to plan for grid access and reliability compliance together.

The Petition addresses the registration component of that directive. NERC’s Board adopted initial computational load Reliability Standards on October 26, 2026, and further standards work is underway on computational load performance, planning and reliability studies, event reporting and model quality. The standards and their implementation plans require separate FERC approval, and compliance obligations would begin on the applicable effective dates.

Key Insights and Next Steps

• Companies should screen existing, under-construction and planned Sites against both the 50 MW and 100 kV thresholds, accounting for multiple points of connection at a single location. A lower-voltage service agreement or on-site generation should not be assumed to remove a grid-connected Site from applicability under the Reliability Standards.
• Different entities may perform the CLO and CLOP functions. Companies should review ownership structures, leases, co-location arrangements, operations and maintenance agreements, and service contracts to determine which entities should register for each function. The analysis should focus on who owns and maintains the Site and who controls its electrical operations.
• Companies should review leases, construction and operating contracts, interconnection agreements and transaction documents to allocate responsibilities for NERC registration, cooperation, data sharing, audits and indemnification. Contract allocations should match actual control and access to information; they do not by themselves eliminate NERC responsibility.
• Potential registrants should involve their engineering and operating teams now to identify gaps in electrical models, operating data, communications with grid operators, protection systems and records of grid disturbances.
• Comments and motions to intervene in Docket No. RR27-1-000 are due November 20, 2026, at 5 p.m. Eastern.